Disguised unemployment generally means

Answer: (c) Marginal productivity of labour is zero

Disguised unemployment means more workers are engaged in a job, typically family farming, than the work needs. Everyone looks employed, but the extra workers add nothing to output. Their marginal productivity is zero, so withdrawing them would not reduce production.

• ✓ (c) Surplus workers on a farm or in a family enterprise add no output. Take a farm that needs only two workers and the farmer himself, but employs five workers plus the farmer's wife and children. That situation is disguised unemployment. It arises when a worker's marginal contribution to output is zero or negative.
• ✗ (a) This describes open unemployment, where people have no work and are visibly jobless. In disguised unemployment people appear to be working, so they do not show up as unemployed.
• ✗ (b) Lack of alternative jobs is a cause or background condition, not the definition. The defining feature is that the surplus workers contribute nothing to output.
• ✗ (d) Low productivity is a wider idea that also fits underemployment and low-skill work. Disguised unemployment is the narrower case where the extra worker's contribution is zero, not just low.

Remember · Disguised unemployment is hidden surplus labour, mostly in Indian agriculture. Workers look employed, but their marginal productivity is zero, so removing them leaves total output unchanged.

📘 Read it in NCERT: Class 11 Indian Economic Development, Ch 6 (practise this chapter)

Question: UPSC Civil Services (Preliminary) 2013, General Studies Paper I. Explanation: Minimalist IAS, checked 25 Oct 2026 (how we verify). · Report an error