Welfare and Poverty Impacts of Mahatma Gandhi National Rural Employment Guarantee Scheme: Evidence from Andhra Pradesh, India

38 Pages Posted: 23 Oct 2013 Last revised: 12 May 2017

See all articles by Klaus Deininger

Klaus Deininger

World Bank - Development Economics Group (DEC); World Bank - Development Research Group (DECRG)

Yanyan Liu

International Food Policy Research Institute (IFPRI)

Date Written: May 2017

Abstract

India’s National Rural Employment Guarantee Scheme (NREGS) is one of the largest public works programs globally. Understanding the impacts of NREGS and the pathway through which its impacts are realized thus has important policy implications. We use a three-round 4,000-household panel from Andhra Pradesh together with administrative data to explore short- and medium-term poverty and welfare effects of NREGS. Triple difference estimates suggest that participants significantly increase consumption (protein and energy intake) in the short run and accumulate more nonfinancial assets in the medium term. Direct benefits exceed program-related transfers and are most pronounced for scheduled castes and tribes and households supplying casual labor. Asset creation via program-induced land improvements is consistent with a medium-term increase in assets by nonparticipants and increases in wage income in excess of program cost.

Keywords: Economic development, employment, Governance, Labor market, Public investment, rural areas, social policies, social safety nets, India, South Asia, Asia

Suggested Citation

Deininger, Klaus and Liu, Yanyan, Welfare and Poverty Impacts of Mahatma Gandhi National Rural Employment Guarantee Scheme: Evidence from Andhra Pradesh, India (May 2017). IFPRI Discussion Paper 01289. Available at SSRN: https://ssrn.com/abstract=2343178 or http://dx.doi.org/10.2139/ssrn.2343178

Klaus Deininger (Contact Author)

World Bank - Development Economics Group (DEC) ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

HOME PAGE: http://econ.worldbank.org/staff/kdeininger

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

Yanyan Liu

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

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