| Abstract: | While non‐compliance with legislation and regulations is said to be rife in developing countries, there is limited systematic evidence of the magnitude of non‐compliance. The authors quantify non‐compliance with India's Factories Act in 2010 and find that the number of non‐compliant firms is nearly twice that of compliant firms, and much larger than the number of firms “adjusting out” of the legislation. Thus, non‐compliance with the Factories Act is a key feature of India's “missing middle”. The main trends and patterns of non‐compliance are explored, and a number of key issues highlighted for further analytical and policy research. |
