The Relationship between MSMEs and Job Quality: Evidence from Granger’s Causality Test

Indian economy is considered as one of the largest economy in the world, where MSMEs (Micro, Small and Medium Enterprises) are considered as primary source of employment generation and economic development. The growth of the sector has led to the growth of the economy which has further led to the growth of job creation. Better the job quality, stable will be the MSMEs. Thus it is necessary to study the relationship between MSMEs and job quality. Causality test using secondary data was used in the study. PCI (Per Capita Income) and PRODPC (Per Capita Production) were the two variables considered in the study. PCI was used as a proxy variable for the Job quality. ARDL (Autoregressive Distributed Lag) cointegration technique was used to study the long and short run dynamic integration of PCI and PRODPC. The results confirm the bidirectional causality between PRODPC and PCI.