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Wages, participation and targeting-the case of the employment guarantee scheme in India

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  • Raghav Gaiha

    (Faculty of Management Studies, University of Delhi, India)

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    Abstract

    Participation in the Employment Guarantee Scheme (EGS) changed significantly during the period 1979-89. A marked reduction in the share of EGS participants in the labour force was accompanied by a considerably lower proportion of the poor among them. While a small part of the reduction in EGS attendance was a direct consequence of the 'rationing' following the EGS wage hike in 1988, much of it was in fact due to expansion of employment opportunities in agriculture. Instead of helping the poor, a wage hike without a corresponding increase in the budgetary outlay thus made it harder for them to participate in EGS. Nevertheless, there were other significant benefits to the poor. One was the strong positive (long-run) effect of this scheme on agricultural wages. Another was income stabilization through employment in agriculturally slack periods. To the extent that exclusion of subsets of the poor from EGS can be minimized through improvements in its design and implementation, the benefits to the poor would be substantially greater for a given outlay.

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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Journal of International Development.

    Volume (Year): 8 (1996)
    Issue (Month): 6 ()
    Pages: 785-803

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    Handle: RePEc:wly:jintdv:v:8:y:1996:i:6:p:785-803

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    Web page: http://www3.interscience.wiley.com/journal/5102/home

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    References

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    1. Deolalikar, A.B. & Gaiha, R., 1993. "What Determines Female Participation in Rural Public Works? The Case of India's Employment Guarantee Scheme," Working Papers 93-05, University of Washington, Department of Economics.
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    Cited by:
    1. Chau, Nancy H. & Kanbur, Ravi & Qin, Yu, 2012. "DO PUBLIC WORK SCHEMES DETER OR ENCOURAGE OUTMIGRATION? Empirical Evidence from China," Working Papers 128799, Cornell University, Department of Applied Economics and Management.
    2. Raghav Gaiha, 2000. "On the Targeting of the Employment Guarantee Scheme in the Indian State of Maharashtra," Economic Change and Restructuring, Springer, vol. 33(3), pages 203-219, October.

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