Abstract/Summary

In this thesis we look at labour market participation and well- being experiences of individuals employed in two gendered informal sector occupations: sex work and domestic work. I reflect on the similarities and the differences between the trades and analyse how that reflects on the labour market and well-being outcome for the two trades. Both the trades constitute work that is traditionally considered ‘woman’s work’ and are seen to replace the role that housewives are expected to play. Both the trades require little or no formal education and in much of the world including India, the trades are both largely unorganised which fall within the grey area of the legislative framework. However, we argue that the trades differ significantly because of the stigma attached in the trade. While there is some stigma attached to both the trades. The stigma associated with sex work is moral stigma as against the physical stigma associated with domestic work. This means that though domestic work is looked down upon as dirty, it is considered a ‘necessary dirt’ while sex work is tainted as morally degraded. The thesis is organised around four research questions which are structured within nine chapters. In the first chapter we introduce and briefly describe the structure of the thesis. In the second we describe the organisation of sex work and domestic work in India and review the recent literature of the two trades. In the third chapter we discuss the methodology including the collection of qualitative and quantitative data from 247 sex workers and 274 domestic workers (part time) living and working in two Indian cities- Delhi and Kolkata. In this thesis we attempt to answer four main research questions which are also laid out in the Chapter 3. In Chapter 4 we discuss the first question which corresponds to an ongoing debate in the literature as to why sex work pays more than other trades that require similar levels of skill. Using pooled data of the two occupations we look at the difference in the earning levels in the two occupations, the vulnerability to abuse and the subjective happiness of women in the two occupations. Using counterfactual analysis we find that women in sex work earn more than what they would have earned had they been domestic workers. They are also less likely to be happy in comparison to what would have been the case had they been domestic workers. We contend that to some extent the differences can be explained by the stigma attached to (the sex worker automatically is tainted if she enters the trade). We also look at the selection of the individuals into the two trades and find that abuse in the past (either at home or in past occupations) significantly increased the probability that the individual is a sex worker. We discuss institutional factors that determine the outcomes for individuals in these two occupations in Chapter 5. We also engage in a descriptive analysis of the two markets using the framework of institutional economics and provide descriptive models for the markets for sex work and domestic work. We additionally discuss the idea of bargaining power, a concept that we use in the subsequent chapters. In Chapter 6 we look at the process of contract formation in sex work. Sex workers often enter informal contracts with intermediaries that enable them to function in the market. Given the social and legal status of the trade, the formation and nature of contracts are usually characterised by incomplete information and cannot be legally enforced. In this paper we build a theoretical model of contract formation as a cooperative bargaining model based on Svejnar (1986). The model relaxes Nash’s axiom of symmetry to incorporate unequal bargaining power between the sex worker and the intermediary, which for the sake of the model is interpreted as the brothel. The model makes predictions on hours worked and how the earnings from the client are divided between the sex worker and the brothel. The theoretical model predicts that the higher the brothel’s relative bargaining power (interpreted as the brothel’s control and surveillance over the sex worker), the higher the number of hours the sex worker has to work. The share of income that the sex worker retains is determined by two factors: 1) the certainty from the brothel’s point of view that the agreement will be reached and the contract will be respected; and 2) the sex worker’s marginal disutility to additional hours worked. The empirical estimation is limited by our inability to observe the sex worker’s utility function. The empirical results indicate that brothels with high vigilance impose higher number of hours worked on the sex worker and retain higher proportions of what the client pays. Sex workers who indicate higher disutility from their occupation (those who believe their occupation is ‘bad’ or ‘unacceptable’) are likely to retain a lower proportion of what the client pays for their services. In Chapter 7 we investigate the relationship between the bargaining power of domestic workers and their labour market outcomes. We introduce the idea of ‘subjective bargaining power’ which is the individual’s perception of their own bargaining power and is used as a proxy for their actual bargaining power. We ask whether the bargaining power of the individual plays a role in determining labour market outcomes, in particular the number of hours worked and the notice period given (by either the worker or the employer) at the termination of the last employment. We build two indices of subjective bargaining power using principal component analysis. Since we expect some endogeneity, we instrument bargaining power with the domestic workers’ ‘availability of information regarding getting to the station’. We find bargaining power to significantly reduce both hours worked as well as notice period given, indicating that women with higher bargaining power work lower number of hours and prefer flexible contracts. In the Chapter 8 we look at the effect of the individual’s subjective bargaining power on their well-being outcomes, considering both sex workers and domestic workers. Well-being is defined in terms financial independence, decision making, trust, happiness and vulnerability to abuse for women involved in both the occupations, and additionally in terms of mobility for sex workers. Findings indicate that for both sex workers and domestic workers bargaining power does significantly impact well-being outcomes. We also discuss qualitative reflections on well-being in this chapter. In Chapter 9 we conclude and discuss the contributions and limitations of this thesis.