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Rural Public Works and Poverty Alleviation--the case of the employment guarantee scheme in Maharashtra

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  • Raghav Gaiha
  • Katsushi Imai

Abstract

This paper focuses on the poverty alleviating potential of the Employment Guarantee Scheme (EGS) in (the Indian state of) Maharashtra. A point of departure is the shift of emphasis from the static to the dynamic effects of the EGS targeting, measured in terms of individuals moving into and out of poverty, over the period 1979-84. An assessment is made of whether the EGS prevents the vulnerable from falling into poverty or enables the poor to move out of poverty, by distinguishing between the protective and promotional roles of the scheme. Simulations involving a wide range of poverty thresholds and different assumptions about the distribution of EGS earnings reveal that the poverty alleviating potential is limited in most cases. If, however, a larger EGS outlay is combined with more accurate targeting, the potential is substantially greater. Larger outlays are feasible if other rural public works are merged under the EGS. If this is combined with a reallocation in favour of backward areas, the targeting may improve substantially.

Suggested Citation

  • Raghav Gaiha & Katsushi Imai, 2002. "Rural Public Works and Poverty Alleviation--the case of the employment guarantee scheme in Maharashtra," International Review of Applied Economics, Taylor & Francis Journals, vol. 16(2), pages 131-151.
    • Handle: RePEc:taf:irapec:v:16:y:2002:i:2:p:131-151
    DOI: 10.1080/02692170110118876
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    Cited by:

    1. 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.
    2. 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.
    3. Alzúa, María Laura & Shady, G. David Rosas, 2009. "Comments," LSE Research Online Documents on Economics 123108, London School of Economics and Political Science, LSE Library.
    4. Ravallion, Martin, 2008. "Evaluating Anti-Poverty Programs," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 59, pages 3787-3846, Elsevier.
    5. Katsushi Imai, 2003. "The Employment Guarantee Scheme as a Social Safety Net - Poverty Dynamics and Poverty Alleviation," Economics Series Working Papers 149, University of Oxford, Department of Economics.
    6. Barrientos, Armando & Nino-Zarazua, Miguel, 2010. "Social Assistance in Developing Countries Database Version 5.0," MPRA Paper 20001, University Library of Munich, Germany.
    7. R Gaiha & K Imai, 2005. "A Review of the Employment Guarantee Scheme in India," Economics Discussion Paper Series 0513, Economics, The University of Manchester.
    8. Katsushi Imai & Raghav Gaiha & Woojin Kang, 2011. "Vulnerability and poverty dynamics in Vietnam," Applied Economics, Taylor & Francis Journals, vol. 43(25), pages 3603-3618.
    9. Raghav Gaiha, 2004. "Is There a Case for the Employment Guarantee Scheme in India? Some Recent Evidence," ASARC Working Papers 2004-09, The Australian National University, Australia South Asia Research Centre.

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