For centuries, caste influenced India’s labour market but how does it affect labour market nowadays? According to a new study by Suanna Oh of Columbia University, caste identity remains an important factor in the job decisions of workers in rural India.

Many workers are averse to taking up jobs associated with other castes, and they are especially averse to working with castes ranked lower than their own, according to results from a field experiment Oh conducts in rural Odisha.

As part of the experiment, Oh measures the willingness of 630 casual labourers to take up jobs that involve spending time on different manual tasks related to producing paper bags. She finds that the average ‘take-up’ rate of a task falls by 23 percentage points if the task is associated with castes other than the worker’s caste. The decline is even greater (47 percentage points) when the caste associated with the task is ranked lower than the worker’s caste. These choices were made in private and not publicized suggesting that they were motivated by workers’ own consciousness of caste identity rather than concerns over social image.

Through a separate experiment, the author also shows that 43% of workers refuse to spend ten minutes working on tasks associated with other castes, even when offered ten times their daily wage. In explaining these rejections of work, the workers cite reasons such as a personal sense of shame, caste-related concerns and a lack of will.

Oh concludes that if workers with the same talent and skillset avoid certain occupations due to caste identity, it could cause significant misallocation of talent in the economy.

Also read: Does Identity Affect Labor Supply?

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