Informality and Flexible Specialization: Informal Knowledge, Technical Change, and Labour Market Institutions in the Banaras Silk Weaving Industry
University of Massachusetts, Boston
17th November, 2016 (Thursday) at 3:00 PM
Venue : Seminar Room (First Floor)
Department of Economics, Delhi School of Economics
All are cordially invited
Artisanal clusters are a prominent feature of the Indian manufacturing landscape from the point of view of employment, output, as well as export earnings. But mechanisms of labour training, knowledge sharing or hoarding, as well as wage setting and technical change prevailing in these clusters are comparatively less well understood. Unlike the formal manufacturing sector, informal institutions such as family and caste/community are critical to their functioning. In this talk I draw on primary quantitative and qualitative data from the Banaras (Varanasi) silk weaving cluster to show how informal institutions interact with the relations of production to enable flexible specialization while reproducing or accentuating poverty and inequality. In particular, focusing on the on-going transition in this cluster from handlooms to powerlooms, I show how the family-based apprenticeship system produces a supply of highly skilled workers but contributes to labour surplus by lowering the costs of entry and making exit difficult. I also present evidence that, as expected for a labour surplus regime, piece wages adjust to productivity changes such that daily wages do not change and ordinary weavers do not benefit from technical improvements. Women workers, performing paid as well as unpaid work, are the most vulnerable. Finally, I evaluate why certification-based systems such as Handloom Mark and the Geographical Indication may not result in welfare gains for the majority of weavers and propose some alternative ways to make artisanal clusters engines of employment-led growth.