Does India's Employment Guarantee Scheme Guarantee Employment?

By Puja Dutta, Rinku Murgai, M. Ravallion, Dominique van de Walle. 2012

304 citations recorded by the source corpus.

In 2005 India introduced an ambitious national anti-poverty program, now called the Mahatma Gandhi National Rural Employment Guarantee Scheme. The program offers up to 100 days of unskilled manual labor per year on public works projects for any rural household member who wants such work at the stipulated minimum wage rate. The aim is to dramatically reduce poverty by providing extra earnings for poor families, as well as empowerment and insurance. If the program worked in practice the way it is designed, then anyone who wanted work on the scheme would get it. However, analysis of data from India's National Sample Survey for 2009/10 reveals considerable un-met demand for work in all states. The authors confirm expectations that poorer families tend to have more demand for work on the scheme, and that (despite the un-met demand) the self-targeting mechanism allows it to reach relatively poor families and backward castes. The extent of the un-met demand is greater in the poorest states -- ironically where the scheme is needed most. Labor-market responses to the scheme are likely to be weak. The scheme is attracting poor women into the workforce, although the local-level rationing processes favor men.

Subfields: Economics and Econometrics, Sociology and Political Science, Soil Science

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Citations in the corpus

Recent Social Security Initiatives in India (2017, unknown): “Indeed, there is a large unmet demand for NREGA work (Dutta et al., 2012).”
Building State Capacity: Evidence from Biometric Smartcards in India (2016, background): “Further, both prior research (Dutta et al., 2012) and data from our control group suggest that even conditional on doing NREGS work, the payment process is slow and unreliable, limiting the extent to which the NREGS can effectively insure the rural poor.”
Welfare and Poverty Impacts of India's National Rural Employment Guarantee Scheme: Evidence from Andhra Pradesh (2013, background): “While the program effectively targets the poor, significant rationing remains (Dutta et al. 2012a), so that some benefits may be captured by elites (Niehaus and Sukhtankar 2012), thereby reducing the program’s effectiveness in transferring resources to the poor (Shankar, Gaiha, and Jha 2011).”
Labor Market Effects of Social Programs: Evidence from India's Employment Guarantee (2015, background): “Using answers to these questions, Dutta et al. (2012) confirm that three years after the scheme started, demand for work is still more rationed in the poorest states of India.”
Politicians, Bureaucrats, and Development: Evidence from India (2016, background): “Growing research on NREGS has examined the impact of the program on socioeconomic outcomes such as wages and employment (Dutta et al. 2014, 2012; Imbert and Papp 2015), fund allocation (Banerjee et al. 2014; Gupta and Mukhopadhyay 2014), and political violence (Fetzer 2014; Khanna and Zimmermann…”