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How dependent are the rural poor on the employment guarantee scheme in India?

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  • Raghav Gaiha

Abstract

An analysis of the ICRISAT data for two villages in the Indian state of Maharashtra points to mistargeting of the Employment Guarantee Scheme (EGS). There was a marked deterioration in it over the period 1979–89, reflected in not just a larger concentration of the more affluent among the EGS participants but also their much larger gains from participating in this scheme. Nevertheless, a large subset of the chronically poor depended heavily on EGS as an additional source of income, with significant welfare gains, during 1979–84. But a large subset — especially of relatively low income participants ‐ also withdrew from EGS when overall economic conditions improved. Besides, EGS earnings varied consistently with economic conditions. Although the present analysis raises some concerns about the mistargeting of EGS and, in this context, about the design and implementation of this scheme, the presumption that such public support makes the poor perpetually dependent on it seems somewhat exaggerated, if not mistaken.

Suggested Citation

  • Raghav Gaiha, 1996. "How dependent are the rural poor on the employment guarantee scheme in India?," Journal of Development Studies, Taylor & Francis Journals, vol. 32(5), pages 669-694.
    • Handle: RePEc:taf:jdevst:v:32:y:1996:i:5:p:669-694
    DOI: 10.1080/00220389608422435
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    References listed on IDEAS

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    1. Martin Ravallion & Gaurav Datt, 1995. "Is Targeting Through a Work Requirement Efficient? Some Evidence for Rural India," Monash Economics Working Papers archive-41, Monash University, Department of Economics.
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    1. Imai, Katsushi, 2007. "Targeting versus universalism: An evaluation of indirect effects of the Employment Guarantee Scheme in India," Journal of Policy Modeling, Elsevier, vol. 29(1), pages 99-113.
    2. Chhachhi, A., 2009. "Democratic citizenship or market based entitlements? : a gender perspective on social protection in South Asia," ISS Working Papers - General Series 18707, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    3. Basu, Arnab K. & Chau, Nancy H. & Kanbur, Ravi, 2009. "A theory of employment guarantees: Contestability, credibility and distributional concerns," Journal of Public Economics, Elsevier, vol. 93(3-4), pages 482-497, April.
    4. Raghbendra Jha, 2002. "Rural Poverty in India: Structure, determinants and suggestions for policy reform," ASARC Working Papers 2002-07, The Australian National University, Australia South Asia Research Centre.
    5. repec:pru:wpaper:19 is not listed on IDEAS
    6. repec:pru:wpaper:20 is not listed on IDEAS
    7. Martin Ravallion, 2003. "Targeted transfers in poor countries : revisiting the trade-offs and policy options," Social Protection Discussion Papers and Notes 27869, The World Bank.
    8. Amita Shah & Aasha Kapur Mehta, 2010. "Experience of the Maharashtra Employment Guarantee Scheme: are there lessons for NREGS?," Working Papers id:2774, eSocialSciences.
    9. Nancy Chau & Ravi Kanbur & Yu Qin, 2014. "Do public work schemes deter or encourage outmigration? Empirical evidence from China," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-20, December.
    10. Patricia Justino, 2007. "Social security in developing countries: MYTH or necessity? Evidence from India," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(3), pages 367-382.

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