Results indicate that on average, contemporaneous productivity effects of contract workers are positive reflecting their high motivation levels in an expectation to obtain permanent status. However, average lagged productivity effect is negative indicating that contract work arrangements that typically last only for a fixed term, potentially hinder the accumulation of firm specific human capital, consequently adversely affecting productivity.
This research was funded under the Private Enterprise Development in Low-Income Countries (PEDL) Programme
Soundararajan, V. Contract Work and Endogenous Firm Productivity in the Indian Manufacturing sector. (2015) 47 pp