Effect of Remittance on Intergenerational Mobility in Case of Occupation
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Effect of Remittance on Intergenerational Mobility in Case of Occupation Indra Kant Bharti1 · Tulika Tripathi2
© Indian Society of Labour Economics 2020
Abstract Migration and remittance certainly influence the occupational mobility (Carletto and Kilic in J Dev Stud 47(6):846–869, 2011) by reducing liquidity constraint, leisure preference and family structure (Torrado in It does not make us lazy: evidence against the moral hazard effect of remittances, The World Bank, Washington, 2012). Diversified evidences suggest to us that the effect of remittance on occupational choice or mobility is shaped by differential social–economic background, social norms and local market requirement. Hence, the local evidences and analysis are more relevant in the case of intergenerational mobility (IGM) of occupation. The present paper examines the role of remittance regarding IGM of occupation with reference to structural upward mobility (SUM, by enjoying existing structural opportunities) and exchange upward mobility (EUM, which is a reflection of policy interventions and affirmative action) between 2004–2005 and 2010–2011, to understand the equalisation effect of remittances across the social group. Keywords Remittance · Upward IGM · Structural IGM · Exchange IGM · Equalisation effect
1 Introduction Recently, it has been a quite popular news that India is the highest remittancereceiving country globally. Remittance is the most important migrant’s resource for intergenerational mobility and causes declines in the social rigidity. Since India is historically stratified into different caste-based occupations (Deshpande * Indra Kant Bharti [email protected] Tulika Tripathi [email protected] 1
Economics and Policy, Adani Institute of Infrastructure and Management, Ahmedabad, India
2
Centre for Studies in Economics and Planning, Central University of Gujarat, Gandhinagar, India
13
Vol.:(0123456789) ISLE
The Indian Journal of Labour Economics
2000), what sociologists call intergenerational occupational mobility as social mobility tied up with inequality of opportunity. A higher movement of intergenerational mobility (IGM) of occupation leads to structural transformation either from individual efforts (parents transfer more human capital endowment to their son by generating more income or receiving remittance) or governmental efforts (more briefly, reservation policy, providing multi-sectoral employment and different welfare policies). It destroys the rigidity of caste-based occupational hierarchy. Empirical evidences have shown that remittances have had mixed results on human capital investment, one which leads to heterogeneous effects on occupational mobility. Remittance and migration shape structural transformation of remained individuals as reallocation of occupation in local labour markets take place. The more pronounced features of remittance arise after the new economic labour migration era (NELM). In this regard, NELM hypothesis asserts that labour migration has two contradictory effects on th
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