SOAS Research Online

Abstract

The thesis examines labour-management relations in Indian industries to provide an alternative analysis of labour market reform priorities. It argues that labour market institutions (LMIs) reflect the balance of power at the macro level, and in turn affect the historically specific ways in which industrial development proceeded in India. Using a combination of micro level data collected from field research in Mumbai (Bombay) and Kolkata (Calcutta), complemented by secondary evidence on the wider social and historical context, the reproduction and transformation of different types of LMIs are explained in terms of their location within changing patron-client politics. The thesis challenges the common argument that industrial performance in Mumbai was better because it enjoyed professional company-based unions compared to unions organised at industry' level and affiliated to political parties in Kolkata. Our interpretation is that the causality is at least partially in the opposite direction, with dynamic regions providing strong incentives for unions to organise to seek company based 'rents' rather than political rents that are more attractive in less industrially dynamic regions. This approach contrasts with some mainstream theories that focus on informational and transaction costs and policy failures as the main determinants of LMIs. We also examine how the labour process is managed under different types of LMIs. We establish the importance of different types of macro political conflicts in shaping the opportunities, incentives and constraints of micro bargaining agents. The mode of bargaining in the LIVIIs is also shown to be affected by the bargaining powers of other actors in the wider social context in which labour-management bargaining takes place. Many mainstream models that inform policy assume that LMIs precede growth and misleadingly treat them as 'exogenous' variables. An important implication of the thesis is that LMIs are 'endogenous' variables and therefore a broader set of reforms are required for sustaining economic growth.