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The Welfare Effects of India's Rural Employment Guarantee

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  • Stefan Klonner, Christian Oldiges

Abstract

We examine the welfare effects of India's workfare program NREGA using a novel, almost sharp regression discontinuity design. We find large seasonal consumption increases in states implementing the program intensely, which are a multiple of the direct income gains. We also find increases in adolescents' school attendance. Our results imply substantial general equilibrium effects. We conclude that, when properly implemented, the public employment program holds significant potential for reducing poverty and insuring households against various adverse implications of seasonal income shortfalls.

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  • Stefan Klonner, Christian Oldiges, 2019. "The Welfare Effects of India's Rural Employment Guarantee," OPHI Working Papers 129, Queen Elizabeth House, University of Oxford.
  • Handle: RePEc:qeh:ophiwp:ophiwp129
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    JEL classification:

    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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