The Impact of Indian Job Guarantee Scheme on Labor Market Outcomes: Evidence from a Natural Experiment

By Mehtabul Azam. Social Science Research Network, 2011

246 citations recorded by the source corpus.

Public works programs, aimed at building a strong social safety net through redistribution of wealth and generation of meaningful employment, are becoming increasingly popular in developing countries. The National Rural Employment Guarantee Act (NREGA), enacted in August 2005, is one such program in India. This paper assesses causal impacts (Intent-to-Treat) of NREGA on public works participation, labor force participation, and real wages of casual workers by exploiting its phased implementation across Indian districts. Using nationally representative data from Indian National Sample Surveys (NSS) and Difference-in-Difference framework, we find that there is a strong gender dimension to the impacts of NREGA: it has a positive impact on the labor force participation and this impact is mainly driven by a much sharper impact on female labor force participation. Similarly, NREGA has a significant positive impact on the wages of female casual workers-real wages of female casual workers increased 8% more in NREGA districts compared with the increase experienced in non-NREGA districts. However, the impact of NREGA on wages of casual male workers has only been marginal (about 1%). Using data from pre-NREGA period, we also perform falsification exercise to demonstrate that the main conclusions are not confounded by pre-existing differential trends between NREGA and non-NREGA districts.

Subfields: Economics and Econometrics, Safety Research, Soil Science

View Paper: https://www.semanticscholar.org/paper/72fa975702e0c1d76ab6fbfdf84a373df19db8a6

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Citations in the corpus

Welfare and Poverty Impacts of India's National Rural Employment Guarantee Scheme: Evidence from Andhra Pradesh (2013, methodology): “Using the same framework, Azam (2012) finds that increases in female wages are larger than increases in male wages.”
Labor Market Effects of Social Programs: Evidence from India's Employment Guarantee (2015, background): “The few existing studies include two concurrent studies, which con rm that the NREGA raised unskilled wages (Azam, 2012; Berg et al., 2012).”