Methodological and Econometric Issues in the Wage Determination between the Inmigrant and Local Labourers

This article is in response to K C Baiju and T C Shamna’s “Determinants of Wage Differences between the Inmigrant and Local Labourers in the Construction Sector of Kerala” (EPW, 3 August 2019). It debates the observations made by the authors on the determinants of wage differences between the inmigrant and the local labourers, citing some methodological and econometric issues.

Migration is a bellwether of fundamental social transformation. It has a strong bearing on the culture, values, attitude, and socio-economic background of both the sending and destination countries. The substantive factor for the dislocation of people is economic in ­nature. The “economic man” in him keeps him part and parcel of the migration chain. The Keralites are unarguably abuzz with inmigration, outmigration, international migration, and, of late, ­return migration. While Kerala has been a host state, which has facilitated migration on a large scale, it has also been a hospitable land in terms of entertaining the interminable inmigrants. There are mainly three causative factors of Kerala being an inmigrant-friendly state. First, the fabulous feat fructified by the state in human development triggered off the propensity of immigration. Second, the white-collar syndrome of Keralites provided an enabling environment for the inmig­rants to establish strong roots in the state. Third, the exodus of people from the state to the Middle East and European countries spawned supply–demand mismatch and a dearth of labour force. This lacuna is wiped off by the influx of migrants, especially in the cons­truction sector of the state. This is the beginning of replacement migration in Kerala (Zachariah and Rajan 2016). Mig­ration is, therefore, the most potent and epoch-making event in the history of the development of Kerala.