The financial practices of the family-firm in the informal sector: Home-based silk production units at Ramanagaram, Karnataka

Abstract

In Business literature, there is very little documentation on how the home-based business in the informal sector is being organized and run. Since the boundary lines here between production and consumption, capital and labour and the firm and household, are often blurred – making it a very complex organization to study. Apart from the informal nature of most of their activities, what makes this task even more complicated is the inter-mingling of finances between the firm and the home (production and consumption). To this end, this project proposes the study of financial practices in home-based silkreeling units in Ramnagaram, Karnataka, towards understanding the ways in which firm and family finances have related to each other, and to the ability of the family-firm to accumulate a surplus on production, especially following post-liberalisation reforms in the silk industry. The intention is to understand the organisation of production and reproduction in this cluster through an examination of the ways in which the post-reform policies - both specific policy impacting the silk industry and broader changes in the local economy - have impacted the everyday financial transactions of firms in this cluster.