Trade Openness and Labour Market Unrest: Evidence from Indian Manufacturing Industry

This paper examines the impact of import competition on industrial disputes in Indian manufacturing. Theoretically, import competition is expected to improve the efficiency of bargaining in the labour market by reducing the incidence of industrial disputes. Impact on two dimensions of disputes, namely number of disputes and number of persons’ days lost in disputes, by segregating them into strikes and lockouts are analysed. Import competition is found to be reducing the number and extent of industrial disputes and the impact is quantitatively significant. The paper discusses the implications of the findings.