Arbeitspapier

Why Guarantee Employment? Evidence from a Large Indian Public-Works Program

Most countries around the world implement some form of a safety net program for poor households. A widespread concern is that such programs crowd out private-sector jobs. But they could also improve workers' welfare by allowing them to take on more risk, for example through self-employment. This paper analyzes the employment impacts of the world's largest public-works program using a novel regression-discontinuity design. The analysis exploits detailed institutional information to describe the allocation formula of the program and to construct a benefit calculator that predicts early and late treatment of districts. The results show that there is little evidence of a crowding out of private-sector jobs. Instead, the scheme functions as a safety net after a bad rainfall shock. Male workers also take on more risk by moving into family employment. This self-revealed preference for a different type of job suggests other potential benefits of safety net programs which so far have received little attention in the literature.

Language
Englisch

Bibliographic citation
Series: GLO Discussion Paper ; No. 504

Classification
Wirtschaft
National Government Expenditures and Welfare Programs
State and Local Government: Health; Education; Welfare; Public Pensions
Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
Time Allocation and Labor Supply
Wages, Compensation, and Labor Costs: Public Policy
Subject
public-works program
anti-poverty program
National Rural Employment Guarantee Scheme
NREGA
NREGS
India
regression discontinuity design
safety net
crowding out
risk coping
risk mitigation
insurance

Event
Geistige Schöpfung
(who)
Zimmermann, Laura
Event
Veröffentlichung
(who)
Global Labor Organization (GLO)
(where)
Essen
(when)
2020

Handle
Last update
10.03.2025, 11:44 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Zimmermann, Laura
  • Global Labor Organization (GLO)

Time of origin

  • 2020

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