This study investigates the determinants of rural female labour force participation rate (RFLFPR) across 24 major Indian states over the period 2017–2023 using a panel data set and fixed-effects regression models. In the study, the Hausman test
= 21.88;
< 0.01) has validated the use of fixed-effects model. The results show that the average daily casual wage rate for females (ADCWF) has a statistically significant positive effect on RFLFPR (
= 0.0598;
< 0.01), the impact being stronger in the empowered action group (EAG) states as captured by the interaction models (interaction coefficient = 0.0462;
< 0.05). The trend analysis has revealed a significant upward trajectory in RFLFPR across the years (
= 3.19;
< 0.001), with a steeper rise in the EAG states (additional trend coefficient = 1.38;
< 0.01). A simulation exercise has indicated that a 10% increase in median ADCWF could potentially lead to an average RFLFPR increase of 1.86 percentage points in the EAG states and 0.70 percentage points in the non-EAG states. The findings underscore that wage-enhancement policies, especially in the backward regions, would substantially boost women’s participation in the rural labour markets. The policy initiatives aimed at raising rural female wages, reducing female unemployment and addressing state-level structural disparities would meaningfully improve gender equity in India’s labour force.
JEL Classification: C33, J16, J31
