Figure A2 shows that the states that have a rigid regulation (left of the graph) are the state that made fewer reforms (low value of labor index) - except for Uttar Pradesh. Conversely states that made more reforms are those who were previously less rigid (at right of the graph) are also those who conducted more reform. So there is little chance that we introduced to much bias when we studied the effect of the reforms, all the more so as we control for state economic opportunities in the regressions.