An Empirical Analysis Of Industrial Disputes: Evidence From Indian States

This paper investigates the determinants of industrial disputes using data for fourteen major states of India over fifteen years from 1981 to 1996. We document that other than purely economic factors (e.g. wages, provident fund and other benefits, and factory size); socio-economic, institutional, and political factors have significant impact on industrial disputes. This supports the political economic view of the trade union behavior. We also provide the evidence that liberalization of Indian economy has enhanced industrial peace. Region specific factors as well as the ideology and characteristics of political parties in power of the state governments influence industrial disputes. Fixed capital per employee and overall growth rate of per capita state domestic products has negligible impact on industrial disputes.