“Does Identity Affect Labor Supply?”

Does identity—one's concept of self—influence economic behavior in the labor market? I investigate this question in rural India, focusing on the effect of caste identity on labor supply. In a field experiment, casual laborers belonging to different castes choose whether to take up various real job offers. All offers involve working on a default manufacturing task and an additional task. The additional task changes across offers, is performed in private, and differs in its association with specific castes. Workers' average take-up rate of offers is 23 percentage points lower if offers involve working on tasks that are associated with castes other than their own. This gap increases to 47 pp if the castes associated with the relevant offers rank lower than workers' own in the caste hierarchy. Responses to job offers are invariant to whether or not workers' choices are publicized, suggesting that the role of identity itself—rather than social image—is paramount. Using a supplementary experiment, I show that 43% of workers refuse to spend ten minutes working on tasks associated with other castes, even when offered ten times their daily wage. This paper's findings indicate that identity may be an important constraint on labor supply, contributing to misallocation of talent in the economy.

Coverage: Marginal Revolution, World Bank Blogs, Livemint, Ideas for India

“Does Financial Strain Lower Productivity?” with Supreet Kaur, Sendhil Mullainathan, and Frank Schilbach

This paper empirically tests for a direct causal impact of financial strain on worker productivity. We randomize the timing of income receipt among Indian workers who earn piece rates for manufacturing tasks: some workers receive their wages on earlier dates, altering when cash constraints are eased while holding overall wealth constant. Workers increase productivity by 5.3% on average in the days after cash receipt. The impacts are concentrated among poorer workers in the sample, who increase output by over 10%. This effect of cash on hand on productivity is not explained by mechanisms such as gift exchange, trust in the employer, or nutrition. We present positive evidence that productivity increases are mediated through lower attentional errors in production, indicating a role for improved cognition after cash receipt. Finally, directing workers’ attention to their finances via a salience intervention produced mixed results—consistent with concerns about priming highlighted in the literature. Taken together, our results indicate a direct relationship between financial constraints and worker productivity and suggest that psychological channels mediated through attention play a role in this relationship.

Coverage: VoxDev

“Gender Norms in Marriage and Female Labor Productivity” with Sneha Subramanian [Pilot in progress]

“Demand for Flexible Work and Contract Choice” with Nandita Krishnaswamy and Yogita Shamdasani [Pilot in progress]