Employment Guarantee and Other Determinants of Subjective Wellbeing in Rural India: A Case Study from Tamil Nadu
18 Pages Posted: 27 Jul 2016
Date Written: February 2, 2015
Abstract
Large-scale socially oriented interventions that rely on monetary transfers have recently become something of a development mantra. These cash-based schemes are founded on the implicit assumption that extra income will translate into improvements in other domains of wellbeing. This paper examines this assumption by focusing on the effects of the Indian Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), a large social-security oriented and legally grounded public works intervention, on subjective wellbeing. It provides a case study from Tamil Nadu which draws on our own field research comprising 1,264 structured interviews in rural households. It was designed as a quasi-counterfactual study to compare the effects of MGNREGS in a region where it was widely implemented (in Sivaganga district) with a similar region (in Thanjavur district) with a population largely unaffected by MGNREGS at the time of our survey. The secondary objective of the paper is to examine the extent to which variables of subjective wellbeing, self-reported poverty, and income (and their predictors) overlap. The results suggest that wide implementation of MGNREGS is associated with higher global (absolute) life satisfaction but not with higher (relative) local life satisfaction. It is also associated with lower self-reported poverty and higher probability of escaping from poverty but not with lower probability of declining into poverty. In addition, the analysis confirms that income, global life satisfaction, local life satisfaction, and self-reported poverty are discrete, though correlated, concepts.
Keywords: happiness; India; MGNREGA; poverty; public works; subjective wellbeing
JEL Classification: I30; I31
Suggested Citation: Suggested Citation