Caste, Religion and Job Market

ABSTRACT This paper uses Periodic Labor Force Survey data to analyze the wage differential between different social and religious groups in the labor market. It investigates if and to what degree communal norms, such as those of religion or caste, have an impact on the benefits of education in India. Results reveal that the differential returns to education between these different social and religious classes can largely be attributed to discrimination in the labor market. The main findings are that Scheduled Tribes (STs) earn a premium compared to Scheduled Castes (SCs) and Other Backward Classes (OBCs) in regular salaried positions. However, STs experience a penalty compared to SCs and OBCs in casual and self‐employed occupations. Turning to the religious groups, Islam faces a penalty over Hinduism for regular and self‐employed jobs, whereas casual Islam workers earn a premium over Hindus. Lastly, Christians and Sikhs earn a premium in all types of jobs over Hindus, although Buddhists face a penalty in regular as well as casual employment.