Social Scientist. v 15, no. 161 (Oct 1986) p. 50.


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50 SOCIAL SCIENTIST

tion between wage-share and capital intensity has been the basis for a technological explanation of wage-share levels. The technology (or labour productivity) bias persisted in the wage-structure literature of the 19/Os. This bias can be criticized. One can question the reduction of historical characteristics of a labour force to simple and directly measurable indices. One can recall Kaldor's remark that in the indstrialized countries, stability in wage-share obtained respite the phenomenal changes in the technology of production'. Finally, rarely can the two effects, bargaining and technology, be as Clearly distinguished as is made out in the statistical literature. To the extent the two can be treated as autonomous, the former has been underestimated through unsound methodology. One of the objectives of the paper would be to isolate as far as possible the effects of pure organisation, without having recourse to quantifying unionism, etc., and to understand its specific impact on wage-share, modifying or intensifying the impact of increasing mechanisation.

The first part of the study presents basic statistics on aggregate and statewise wage-share and the second part analyses inter-industry differences. The last section explores the possible implications of trends in wage-share on location decisions on the one hand and the frequency of intervention on the part of labour on the other.

Trends In Wages Share

Within that segment of the organised sector represented by the ASI (Census sector),2 the share of wages in value added has been steadily decreasing since 1960 (Table I). In this respect there is a continuity, since 1949 at least, of the tendency noted and analysed by the earlier studies on wages-share and trends in real wages. From 53 percent in 1949, the ratio fell to 41 percent in 19^5 hovered around that level for next 5 years when, a second phase of decline started. This second phase has continued although the aggregate ratio seems to be more stable during th6 1970s. The statewise pattern, however deviates greatly from the aggregate.

A fall in the proportion of 'workers' in total work-force contributed to the long trend, but only modestly. Proportion of workers came down from 85 per cent in 1959 to 78 percent in 1979 in the country as a whole. But the statewise picture was just the reverse of that in wage-share, i.e., the proportion of wage-earners in total employment declined to a much lesser extent and more slowly in those very states where wage-share had fallen the most (Punjab-Haryana, Gujarat, Tamil Nadu, etc.).

On the whole decline has been universal across states, with Bihar and West Bengal as the only significant exceptions. However, the timing and extent of the decline vary. In Punjab-Haryana, Gujarat, Tamil Nadu and Maharashtra the trend has remained more or less unbroken whereas in Uttar Pradesh, Karnataka and Andhra sharp reversals have occured. In Kerala, on the other hand, the ratio came down only during the latter part of the period. Wh^t is ofsig'iifiQ^nQ^ i^ that the list indndQS several states



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