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CHAPTER II

REVIEW OF LITERATURE

2.1 INTRODUCTION

Review of literature is a systematic survey on the facts and figures of previous

researches on a particular topic. It is a collection of major findings of past

researches. It is useful to understand what has happened in the topic during the

past period. In every research, there are certain preliminary works and the review

of literature is one of them. A detailed literature on labour welfare measures and

other related issues are given in this chapter.

2.2 EMPIRICAL STUDIES ON IMPACT OF LABOUR WELFARE

MEASURES

Sailesh Sindhu (2012) felt that, employee welfare measures increase the

productivity of organization and promote healthy industrial relations thereby

maintaining industrial peace. Organizations provide welfare facilities to their

employees to keep their motivation levels high. Business houses provide many

such statutory and non-statutory things and policies to maintain satisfactory level

of their employee.

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Mishra & Manju Bhagat (2010) in their Principles for Successful

Implementation of Labour Welfare Activities, stated that labour absenteeism

in Indian industries can be reduced to a great extent by providing good

housing, health and family care, canteen, educational and training facilities

and provision of welfare activities. This principle for successful

implementation of labour welfare activities is nothing but an extension of

democratic values in an industrialized society.

P.KPadhi (2007)stated that, the term welfare suggests the state of wellbeing and

implies wholesomeness of the human being. It is a desirable state of existence

involving the mental, physical, moral and emotional factor of a person. Adequate

levels of earnings, safe and humane conditions of work and access to some

minimum social security benefits are the major qualitative dimensions of

employment which enhance quality of life of workers and their productivity.

Ramesh M. (2012) pointed out that the main thrust of labour policy and labour

law is to change in line with the global changes that is from welfare and

regulative orientation to develop role in market oriented economy, from

regulatory mechanization to voluntarism, tripartism to bipartism so that the

employers and employees are themselves able to mutually decide without

government intervention.

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Torjman (2004) demonstrated that welfare facilities and recreation accounts for

healthy individual besides encasing among their happiness and emotional

quotient.

S. Poongavanam (2011) felt that the welfare measure will improve the

physique, intelligence, morality and standard of living of the workers, which

in turn will improve their efficiency and productivity. From the study on

labour welfare facilities in AFT, the researcher concluded that, the various

welfare facilities such as health, safety, canteen, uniform, education and gift

facilities in AFT, enables workers to live a rich and more satisfactory life.

It also contributes to increasing productivity of the enterprise improving

efficiency of the worker and raises their standard of living. Thus the labour

welfare facilities provided by AFT are good.

K. Jayanthi, P. Ashok Kumar and V. Manju, (2012) stated that labour sector

addresses multi-dimensional socio-economic aspects affecting labour welfare,

productivity, living standards of labour force and social security. To raise living

standards of the work force and achieve higher productivity, skill upgradation

through suitable training is of utmost importance. Manpower development to

provide adequate labour force of appropriate skills and quality to different

sectors is essential for rapid socio-economic development. Employment

generation in all the productive sectors is one of the basic objectives. Based on

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the findings the Industry may consider the suggestion to maintain a good Labour

Welfare Measures and providing of the necessary support measures for sorting

out problems relating to employment.

Morris Altman (2000) says that standard neo-classical theory argues that an

economy is negatively affected by increased labor rights and power since it is

assumed that economic agents are always x-efficient; performing at the height of

efficiency. However, a behavioral model of the firm suggests that more rights

and power, with its positive impact on labor standards, need not produce the

deleterious results predicted by conventional economic wisdom, due to their

productivity-efficiency enhancing impact on the firm. This suggests that

organizations should not assess the impact of enhanced labor power and control

in terms of a zero sum game.

Various theories of labour welfare reflect the attitude and belief of the

management, which is instrumental in providing and maintaining welfare

activities. These theories are 1) The policing theory, 2) The religious

theory, 3) Philanthropic theory, 4) Paternalistic theory, 5) Placating theory,

6) The public relation theory, 7) The functional theory and 8) The quid pro

quo theory.(Mahagaonkar, 1986).

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2.3 EMPIRICAL STUDIES ON STATUTORY LABOUR WELFARE

MEASURES

Joshi (1927) felt that labour welfare covers all the efforts which employers make

for the benefit of their employees over and above the minimum standard of

working conditions fixed by the Factories Act, and over and above the

provisions of social legislation providing against accident, old age,

unemployment and sickness.

Ramesh M. (2012) stated that the primary objective of every management is to

provide better working facilities to the employees in the interest of obtaining

speedy, safe and efficient work.

Earlier studies of employment stability among welfare recipients and other low-

wage workers, as well as its effects on their wages over time, have relied heavily

on data from the National Longitudinal Survey of Youth (NLSY) from the 1980s

and early 1990s. Studies of employment retention for recipients include Hershey

and Pavetti (1997), while Holzer and Lalonde (2000) focus on less-skilled

young women and men more broadly. Both the studies find somewhat high

turnover rates and relatively short job spells among unskilled workers with little

experience; in particular, Hershey and Pavetti reports average job durations of 37

weeks (or 9 months) for recipients, while Holzer and Lalonde finds average

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weekly turnover rates of about 2 percent (and therefore median job durations of

about 6 months).

Stephen Bazen (1994) says minimum wage fixing came to be increasingly

questioned during the 1980s owing to high unemployment and the rise of liberal

economic thinking. This led many countries to dilute minimum wage protection

by freezing the rates or altering the coverage. However, close examination of the

relevant research reveals that empirical support for the criticisms of minimum

wages is fairly weak and fragmented. At the end of the 1980s and beginning of

the 1990s, many countries, Great Britain being a notable exception, pursued a

more active minimum wage policy. Conclusions reveal that with a re-

examination of the goals and form of minimum wage legislation in the light of

recent history.

The study team appointed by the Government of India in 1959 to examine

labour welfare activities, then divided the whole range of these existing activities

in three groups, (I) welfare within the precincts of an establishment - medical

aid, crches, supply of drinking water etc., (II) welfare outside the establishment

provision for indoor and outdoor recreation, housing, adult education, visual

instruments etc., and (III) Social Security.

Shyam (1999) states in his article that major reforms to promote health

include ensuring water safety, sanitation, strengthening of nutritional food

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practices, hygiene in homes and eateries, preventing early marriages, health,

education in schools and target groups, public education against habit

forming factors (alcohol and tobacco) safety in work place and agricultural

operations, promotion of exercise, sports, promotion of establishment of bicycle

tracks in towns, health management information recovering both public and

private medical sector.

Work harassment is probably a much more severe and frequent problem in

Western society than people are aware of. On the basis of a study

conducted in Sweden, Leymann (l992) estimates that approximately one of

every seventh suicide is related to work harassment, and among male

Swedes the figure is even higher: Leymann's estimation is as high as one in

five. If the figure is correct, suicide due to harassment is a far more frequent

cause of death than physical accidents at the workplace. In Scandinavian

countries, laws regarding industrial welfare also stipulate regulations about

mental welfare at the workplace, and several lawsuits have been

successfully filed against work harassment. This may explain the great interest

in issues related to the question in Scandinavia.

Rajeshwar W. Hendre (2013) says that statutory welfare provisions as

mentioned in the chapter V of the Factories Act, 1948 are basic and can be

seen from various angles like economic, social, psychological, technical

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and administrative. Its implementation is joint responsibility of the four active

stakeholders namely- workers, Trade Unions, management and the Government.

In case of OEMs it is assumed to be far beyond than myopic version of mere

fulfillment of statutory provisions. However, the precise measurement of level

of implementation brought out some area like canteen, sitting facilities and

facilities for storing and drying clothing shall be improved by the companies.

This will indicate to what extent we should take the same for other companies

such as vendors and component manufacturers.

Ewan Clague noted that the larger plant tends to have lower injury

frequency rates However it depends upon type of industry. Very large

companies may employ a staff of safety specialists and industrial hygienists

(Grimaldi and Simonds, 1996). The same of welfare facilities as health, safety

and welfare have combined impact on the overall wellbeing and health of

workers. Tenth Planning commission states that, it is very difficult to

enforce compliance of laws relating to the safety and health of workers,

resulting the bulk of the workforce does not get a reasonable level of

protection. Such tendencies get accentuated when market forces motivate the

minimization of the cost of labour input. This is the reason that anyone to assess

implementation of welfare provisions.

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Social Security manifests the natural desire of communities for protection

from lifes problems, from disease and deprivation it is the protection

which society provides for its members through a series of public

measures- against the economic and social distress that otherwise would

be caused by the stoppage, or substantial reduction, of earnings resulting

from sickness, maternity, employment injury, unemployment, invalidity, old

age and death; the provision of medical care; and the provision of

subsidies for families with children (ILO, 1998).

2.4 EMPIRICAL STUDIES ON NON-STATUTORY LABOUR WELFARE

MEASURES

Conventions and Recommendations of ILO (1949) sets forth a fundamental

principle at its 26th conference held in Philadelphia recommended some of the

measures in the area of welfare measures which includes adequate protection for

life and health of workers in all occupations, provision for child welfare and

maternity protection, provision of adequate nutrition, housing and facilities for

recreation and culture, the assurance of equality of educational and vocational

opportunity etc.

Devina Upadhyay and Anu Gupta (2012) felt that the HR managers focuses

not only on providing the mandatory welfare facilities as deemed necessary by

the labor tribunal but also provide certain other amenities like medical check
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up ,bonus ,birthday and anniversary gift, library ,sports facilities, recreation

facilities like cultural programmes, movie watch ,safety spectacles etc., to

mention just a few .Provision of these welfare measures today act as one

of the main cost component which human resource specialists justify by

naming it as an exercise to build the job satisfaction and morale of people.

A study conducted by Saiyaddin (1983) examined the purpose and cost

of non-statutory welfare activities for the organizations. Five public and six

private sector organizations were selected for the study. The study brought out

an important conclusion that the most predominant theme in the minds of

organizations when they think of the voluntary welfare measures was not only

the output and efficiency but also increasing loyalty and morale. In respect of

cost, the study revealed, that the public sector organizations spend more on

welfare activities, as compared to private sector. While public sector spends

more on transportation and recreation, private sector was found to be spending

more on housing according to the study.

Jayadevadas (1980) based on his study of coir workers, suggested that the

model before the trade unions in Kerala was that of modern industrial

employment characterized by high wage rates, stable employment, fair working

conditions, non-wage benefits, and long-term economic security. Guha has

argued that given the multiplicity of sectors, and employment and socio-

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economic patterns in each State, as well as of grassroots organisations and

NGOs, it is undesirable to impose uniform patterns on social security systems.

Kazutaka Kogi and Tsuyoshi Kawakami (1997) give several examples from

many countries of the rapid development in research on welfare, epidemiology,

ergonomics, psycho-social issues, occupational medicine, toxicology,

occupational hygiene, environmental health, and biological monitoring in the

Asia-Pacific region. These examples are chosen primarily to illustrate the large

range of subjects researched and the wide number of countries involved.

Ataul-Huq-Pramanik (2000) says the concept of welfare state gained

popularity during the period when the free market mechanism already

established its preeminence. The free market mechanism of the west together

with the personal freedom being nurtured in an environment of democratic

political institutions led to the emergence of the welfare state. The reason why

the welfare state gained popularity during the period when the industrialized

world was enjoying economic prosperity was because of the growing need for

protecting the rights of citizens from any unforeseen events regardless of their

existing socio-economic conditions.

P.Swpana (2011) stated that the Company to start a new scheme i.e., FTAR

(Free Treatment after Retirement) especially to the retired employees and

this benefit can be enjoyed by the employees and as well as by the

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company. For this the company need not pay any amount in the form of

investment because the company can collect money every month from their

salary like provident fund till their retirement and can be used after retirement.

2.5 EMPIRICAL STUDIES ON LEVEL OF SATISFACTION TOWARDS

LABOUR WELFARE MEASURES

Parul P Bhati, and Dr.Ashokkumar M (2013) conclude their research, in

terms of proving that the different welfare provisions provided to the employees

working in an organization under the Factories Act 1948 are having positive

relation with the employee satisfaction.

Jon - Chao Hong, Sung-De Yang, Li-Jung Wang, En-Fu Chiou, Fan-Yin Su,

sui - Lan Huang (2006) says everyone works in expectation of some rewards,

and welfare is one of them. In order to understand the impact of employee

benefits on employees' work-motivation and productivity, questionnaires were

sent to corporations which had undertaken employee benefit programmes. Some

of the significant results of this study are: employee benefit programmes have

greater impact on work-motivation than on productivity; monetary benefit

programmes are most highly valued by both executives and workers; there is a

cognitive gap between management and worker on the importance of employee

benefit programmes; different genders have different benefit demands;

unmarried employees, more than married employees, perceive that employee


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benefits have a greater impact on job performance. Employees with different

education levels and positions perceive different employee benefit impacts; and

employee benefit programmes have greater influence on younger employees' job

performance.

A closely related economics literature is concerned with "fairness". Survey

evidence such as Kahneman, Knetsch and Thaler (1986) shows that people

have strong views about fairness in economic exchange. Laboratory evidence on

so-called ultimatum games (Guth et al, 1982, Bolton, 1991, and Smith, 1994)

suggests that individuals will throw away real income to obtain a fairer division

of a smaller pie. It seems likely that decisions about fairness rest on some sort of

comparative process, but the details are not well understood.

A precursor to this paper is an original but comparatively little-known paper by

Hamermesh (1977). The author takes a sample of American employees,

covering the years 1969 and 1973, and estimates job satisfaction equations. This

seems to be the earliest article of its kind in the economics literature. Although

Hamermesh's focus is upon occupational choice and the effects of training, and

he does not discuss - at least in any detail - ideas of relative deprivation, his

regression equations include the residual from a wage equation as an explanatory

variable.7 That residual enters positively and significantly in a job satisfaction

regression, which is akin to finding that y-y*, in the earlier notation, affects

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utility. More recently, Lvy-Garboua and Montmarquette (1994) and Sloane

and Williams (1994), using Canadian and British data respectively, have

examined the correlation between predicted income and job satisfaction.

P.V.V.Satyanarayana (2011) says that generally, welfare measures are

recreational, medical, educational, housing, sanitation and so on. Every

organization provides the statutory welfare measures but some organization

provides some more welfare facilities to the employees so that they may

retain the employees and their quality of work life. By the result of

improved quality of work life among the employees and their involvement

in job gets increased and results in increased productivity of the

organization. The organizations maintaining smooth relationship between

workers and management, which leads to attainment of organization efforts.

By conducting this study we could infer that the Employees of Sugar

Factories in East Godavari District are satisfied with the welfare measures

provided by their organization

2.6 EMPIRICAL STUDIES ON PROBLEMS INVOLVED IN

IMPLEMENTING LABOUR WELFARE MEASURES

Ramesh Kumar Bhardwaj (2012) point out that Government has enacted a

plethora of labour welfare legislations from time to time. Workers have been

provided with many welfare facilities and amenities under these


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legislations. But these enactments have not been enforced in their true

letter and spirit. Welfare amenities have not been properly provided to the

workers except in units managed by progressive employers or in modern units

where the latest technology demands maintenance of adequate standards. It

is also experienced and observed that majority of the Labour welfare

officers are not being appointed as per the prescribed qualification. In spite

of this, it is true that the inspection and supervision of the Labour welfare

amenities is not on a satisfactory level.

K.K. Chaudhuri, states that HR policies are being made flexible. From leaves

to compensations, perks to office facilities, many companies are willing to

customize policies to suit different employee segments. The older employees

want social security benefits, younger employees want cash in hand because they

cant think of sticking to a company for many years and retire from the same

company. Therefore one jacket fits all will not be right to motivate the talents

and retain them.

Ramesh. M (2012) stated that in todays competitive environment, attracting

and retaining skilled personnel depends upon the competitive and compensation

package the company offers. Everyday innovative, attractive compensation

packages are luring the personnel. Thus, organization needs to provide more

attractive compensation and qualitative packages to enhance the motivation of

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the people. In the present competitive business environment, the management is

planning to reduce.

Abdus Sattar Abbasi, et. al (2010) stated that welfare and protection of all

stakeholders including shareholders, employees, customers, environment and

society at large is the core responsibility of organization. Therefore,

corporate leaders/managers should be held accountable for financial and

non-financial losses e.g. Ethical breaches and other threats to organizational

reputation. Every member should have the right to question anything she/he

thinks is not good for the welfare and protection of all stakeholders of an

organization.

Ransley (2009) suggests that the absence of a comprehensive and sustainable

welfare policy in Kenya has contributed to the unsatisfactory provision of

welfare services, terms and conditions of service, poor morale, poor performance

by the police and lack of professionalism (Republic of Kenya, 2009). Based on

the prevailing situation, the paper attempts to assess the role of employee welfare

services on performance of the national police service in Kisii Central District

with specific reference to health services.

M. V. Pyle and Simon George (2010) has pointed out that "Even one

discontented employee or an employee nursing a grievance can eventually infect

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an entire organization with the germ of discontent which, in turn, will result in

lower efficiency, poor morale and reduction in overall production".

Terry Sullivan (1978) says Industrial relations can be said to be concerned with

who makes the rules relating to employment matters, what rules will exist and

how any adjustments to such rules will be made. In a large number of industrial

relations systems the process of adjustment is by collective bargaining, and most

industrial relations commentators and practitioners would accept that the scope

for adjustment is constrained by economic, social and political forces. However,

the practicalities and dynamics of this adjustment process are such that decisions

can only be in terms of what Williamson calls bounded rationality. This is a

situation where at the moment of decision, given the quantity and quality of

information that is held, that decision seems rational and acceptable. However,

innate imperfections in information and its flow eventually show the decision to

be something less than satisfactory. Further, many writers believe that collective

bargaining is characterized by management and labour having, at the very least,

potentially conflicting objectives so that for each bounded rationality is

different. The practical results are often some compromise or optimal

outcome that temporarily satisfies the welfare of the parties but can rarely

maximize it. However, we should note that while the parties may reach a jointly

satisfactory outcome, that outcome could be less than optimal for society as a

whole; an inflationary wage settlement is the most obvious example.


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Kevin Olson (2003) says the United States adopted a new welfare regime in

1996. The centerpiece of this legislation is a notion of personal responsibility

that redefines the relation between individuals and the state. This law was used

as a foil to outline a new paradigm of legal research. Welfare must be

understood, as part of a self-referential legal system. Law is legitimated by

particular kinds of fair, democratic political agreement. When material

inequalities undermine political participation, however, the law must insure the

bases of its own legitimacy through welfare. Welfare law is thus vital to a

nations legal system as a whole. Seen from this perspective, the current

American welfare system fails to fulfill the basic presuppositions of legal

legitimacy.

2.7 EMPIRICAL STUDIES ON ASSESSMENT OF EFFECTIVENESS OF

LABOUR WELFARE MEASURES

Assessment of effectiveness of welfare provisions can be measured by 1)

Trend analysis and 2) Opinion survey (Aswathappa, 2007). The former is

indirect method, which measures trends of efficiency, turnover and social evil

as an impact of welfare activities, observed at pre and post implementation of

welfare provisions. The later is most effective and real time method based

on measurement of employees satisfaction and perception relating to

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welfare provision. Hence, the second method is adopted for assessment of

implementation of welfare measures in the companies.

Labour welfare is an extension of the term Welfare and its application to labour.

During the industrialization process, the stress on labour productivity increased;

and brought about changes in the thinking on labour welfare. An early study

under the UN observed as follows in our opinion most underdeveloped

countries are in the situation that investment in people is likely to prove as

productive, in the purely material sense, as any investment in material resources

and in many cases, investment in people would lead to a greater increase of the

flow of goods and services than would follow upon any comparable investment

in material capital (UN, 1951). The theory states that welfare expenditure,

especially expenditure on health and education, is productive investment has led

to the view that workers could work more productively if they were given a fair

deal both at the work place and in the community.

Robert M. Feinberg (1978) says that the job search theory, as developed since

the early 1960s, is primarily a theory predicting the behaviour of unemployed

job-seekers responding to the costs of acquiring information about the wage

possibilities available to them. However, implications can be derived for the

influence on the individual's Labour Force Participation (LFP) decision of the

factors used in search theory, and these implications have never been tested. This

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paper will present a number of hypotheses regarding LFP and then test these

hypotheses against a broad and diverse cross-section sample of male heads of

households, using ordinary least squares regression analysis. The results

generally confirm the hypotheses and the view that the variables of the job

search theory have a significant influence on the LFP decision.

Lawrence A. Leger (1993) says both labour groups and the national press

frequently justify demands for protection against industrial adjustment on the

grounds that it leads to the destruction of communities and traditional ways of

life, with a devastating effect on welfare. To justify this claim in the context of a

Ricardian open-economy model requires quite strong restrictions on worker

preferences, but a plausible case can be made. It presents a model based on the

attachment of workers to their socio-cultural environment, and suggests some

policy options for redressing trade-induced inequities.

Steven J. Haider, et. al (2003) says nationally, the welfare caseload declined by

more than 50% between 1994 and 2000. Considerable research has been devoted

to understanding what caused this decline. Much of the literature examining

these changes has modeled the total caseload (the stock) directly. Klerman and

Haider (forthcoming) model shows the underlying flows and show analytically

and empirically that previous methods are likely to be biased because they

ignore important dynamics. However, due to their focus on the bias of the stock

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models, they present only limited results concerning the robustness of their

findings and utilize only a single measure of economic conditions, the

unemployment rate. The author examines the robustness of the basic stock-flow

model developed in Klerman and Haider (forthcoming), considering both richer

dynamic specifications and richer measures of economic condition. We find that

more complex dynamic specifications do not change the substantive conclusions,

but richer measures of the economy do. While a model that only includes the

unemployment rate attributes about half of the California caseload decline

between 1995 and 1998 to the economy, models that incorporate richer measures

of the economy attribute more than 90% of the decline to the economy.

This is not the first use of panel data to study subjective welfare. The two closest

antecedents are Van De Stadt et al., (1985), Winkelmann and Winkelmann

(1998). The former paper used panel data in modeling a money metric of

subjective welfare in the Netherlands. In addition to the difference in the

dependent variable, Van de Stadt et al., do not allow for latent individual

effects. They do, however, allow for dynamics, by including the lagged

subjective welfare measure as a regressor (though they cannot reject the null that

its coefficient is unity). The authors focus on the narrow concept in the

expectation that it will offer sharper results on the welfare effects of economic

variables; They also use a better income measure, built up from a detailed

survey.
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One can also expect the income measurement error to be correlated with other

variables of interest. For example, it is often conjectured that the rich tend to

understate their incomes when asked by a stranger in an interview for some

survey. (This is not implausible in Russia in the mid 1990s.) They are also less

likely to be unemployed. Then the negative correlation between unemployment

and subjective welfare could be due entirely to this structure of measurement

errors; unemployment will appear to lower subjective wellbeing even if it has no

real welfare effect beyond the loss of income. Similarly, if the time period over

which incomes are measured is too short and it is a longer-term income

concept that drives self-assessments of welfare the authors can expect

unemployment and possibly other characteristics to be correlated with the

difference between the two income measures. Unemployment might have a

significant negative effect on subjective welfare at given current income simply

because respondents naturally worry about future income too. That does not of

course mean that leisure is undesirable, or that there are no adverse incentive

effects of unemployment compensation. The otherwise remarkably high estimate

of the level of unemployment benefits needed to create unemployment implied

by the results in the literature Winkelmann and Winkelmann, (1998) could

well reflect this structure of income measurement error, whereby the income

effect is underestimated while the unemployment coefficient is overestimated.

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The likely endogeneity of income to subjective welfare also clouds past efforts

to test for the claim that it is income relative to some reference group not

absolute income that matters to wellbeing. Stadt et al., (1985) and Clark

and Oswald (1996) regress a subjective welfare indicator on both own income

and an estimate of comparison group income, namely the mean income of

people with similar characteristics. The comparison group income is found to

have a significant negative coefficient with own income entering positively; the

authors conclude that it is relative income that matters to welfare. However, the

significant effect of predicted income could also reflect a misspecification.

Suppose that earnings are influenced by latent personality traits in subjective

welfare via the effects of higher job satisfaction on labor turnover and disputes

(as discussed in, for example Frank, 1985, and indeed Clark and Oswald,

1996). Then the significance of predicted income could be due solely to a

correlation between own income and unobserved determinants of subjective

welfare. Income endogeneity can generate spurious comparison group effects.

The inability of the standard trade theoretic models to explain widening wage

inequality calls for explanations. Although all the empirical studies acknowledge

the inherent ambiguities of wage predictions in the higher-dimensional

Heckscher-Ohlin (H-O) framework, the theoretical literature has not grown

sufficiently to explain this puzzling empirical finding. However, mention should

be made of papers by Feenstra and Hanson (1995) and Marjit, Broll and
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Sengupta (2000) who have explained the increasing wage inequality in

developing countries theoretically in terms of specific structural characteristics

of the less developed countries, such as features of labour markets, structures of

production, nature of capital mobility etc.

The paper of Feenstra and Hanson (1995) is based on the famous Dornbusch-

Fischer-Samuelson continuum-of-goods framework. According to them, inflows

of foreign capital induced greater production of skilled-intensive commodities in

Mexico, thereby leading to a relative decrease in the demand for unskilled

labour. On the other hand, Marjit, Broll and Sengupta (2000) have examined

the impact of trade liberalization on the wage inequality in the presence of

informal sectors. They have shown that the impact of trade on skilled-unskilled

wage gap crucially hinges on the nature of capital mobility between the formal

and informal sectors.

2.8 EMPIRICAL STUDIES ON LABOUR WELFARE MEASURES IN

INDIA

A study conducted by Koshan (1975) pointed out that inspite of statutory

provisions and enforcing agencies in India, the welfare facilities were absent

and the cement industry was the only one where provisions were

adequately enforced. The study suggested that need for overhauling and

tightening the machinery of inspection. Appointment of welfare inspectors for


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different industries, distinguishing the duties of factory inspectors from

those of welfare inspectors to submit annual and quarterly reports and

empowering the welfare inspectors to fine in case of default, were some of the

steps suggested in his study.

Jetli, K. Narindar et. al (2006) examines the whole gamut of labour related

issues during the post-Independence period. The approach to the subject is

mainly descriptive, interspersed by comments at places. He describes

demographic trends, employment policies and strategies, constitutional

provisions, legal framework, and institutions pertaining to labour and its welfare,

current labour policy issues, labour laws pertaining to women and their

empowerment and approaches of WTO and India on matters related to labour.

He also includes glimpses of Indias Five Year Plans from First Five Years Plan

(1951-56) to Tenth Fiver Year Plan (2002-07).

Its resolution of 1947, the International Labour Organisation (ILO) defined

the labour welfare, as "such services, facilities and amenities like adequate

canteens, rest and recreation facilities, arrangements for travel to and from work

and accommodation of workers employed at a distance from their houses

and such other services amenities and facilities which contribute to improve

the conditions under which workers are employee".

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The study team appointed by the Government of India in 1959 to examine

labour welfare activities, then divided the whole range of these existing activities

in three groups, (I) welfare within the precincts of an establishment - medical

aid, crches, supply of drinking water etc., (II) welfare outside the establishment

provision for indoor and outdoor recreation, housing, adult education, visual

instruments etc., and (III) Social Security.

A Sabarirajan, et. al (2010) in their study of the Cotton Textile plays a vital

role in human life. Textile industries are one of the important industries of India

for earning Foreign Exchange and giving employment to lakhs of workers.

Because of being a highly labor intensive industry it needs to concentrate more

in the area of employee welfare. In this study we selected Salem District in

Tamil Nadu, India for identifying various methods and also to identify the

effectiveness of the methods. The study shows that 15% of the employees are

highly satisfied with their welfare measures. 22 % of the employees are satisfied

with their welfare measures.39% of the employees is average with their welfare

measures. 16% of them are in highly dissatisfied level. Welfare measures plays

important role in employee satisfaction and it results in improved quality of

work life. This study throws light on the impact of welfare measures on QWL

among the employees of textile mills in Salam district.

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C. P. John (2004) studied in the paper the large gaps existing between the rich

and the poor and the unorganized workers and the organized workers have led in

several countries to attempts at providing social and economic security to the

poor and to the unorganized sectors. In Kerala, the introduction of modern

techniques of production and the growth of capitalist production relations had

important implications for the traditional crafts as well as craftsman in Kerala.

One of its implications has been the breakdown of the conventional social

security set-up. Craftsmen in Kerala belonged to a specific caste group, namely,

Kammala or Viswakarma. The social security system among craftsmen was

embedded in the craft and caste traditions and practices.

2.9 CONCLUSION

The previous researches on labour welfare have focused from different views.

Many of them are from labour and their unions point of view. Some studies are

individual case studies, concentrating on particular firms. At the same time, the

Government has also made surveys. The findings confirm that the labour welfare

measures have to be improved to maximum extent. And the part researcher has

found out the welfare measures are implemented as mere legal formalities. The

present study takes the BHEL, Tiruchirappalli to study the labour welfare

measures in the same lines.

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