Rural Non-Farm Employment in India : Spatial Variations and Temporal Change

In this paper we propose to re-evaluate the relationship between non-farm employment and poverty and urbanization in rural India for the years 1983 and 1999-00. The choice of the initial and terminal period is deliberate. During this period, the per capita income has broken free from the “Hindu rate of growth”. A larger proportion of the rise in income at least in the 1990s has been in the urban sector (Srinivasan, 1999). It would, therefore, be interesting to take a fresh look at the findings of earlier researches. In this paper, we have tried to find out how the variations in rural non-farm employment during 1983 and 1999-00 has been affected by the reduction in poverty, changes in the degree of urbanization and changes in the occupational structure, if any. Specifically, we propose to test the following hypotheses: (i) poverty and levels of rural non-farm employment are inversely related, (ii) the degree of urbanization of the region has positive impact on the non-farm employment, (iii) the changes in the degree of urbanization of region has positive impact on the growth of non-farm employment, and (iv) increase in the sectoral real wages in non-farm sector has positive impact on the growth of non-farm employment