Workfare as "Collateral": The case of the National Rural Employment Guarantee Scheme (NREGS) in India

Subhasish Dey and Katsushi Imai
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Subhasish Dey: Economics, School of Social Sciences, University of Manchester, UK

No DP2014-27, Discussion Paper Series from Research Institute for Economics & Business Administration, Kobe University

Abstract: This paper argues that a major beneficial impact of workfare programs is through their role in allowing participants to improve their access to “credit”. Sustained program participation serves as “collateral” for households’ acquisition of informal credit, leading to the improvement in economic security and poverty reduction. Using a three-round household panel dataset in India in 2009-2012, we produce robust evidence that continuous participation in NREGS facilitates credit acquisition, increases income and consumption, and reduces consumption variability. A conceptual framework using an infinitely repeated trilateral stage game among lender, workfare participant, and local politician is developed to support our empirical findings.

Keywords: Workfare; Collateral; NREGS impact; Consumption; Credit (search for similar items in EconPapers)
JEL-codes: I38 O12 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2014-06, Revised 2015-03
New Economics Papers: this item is included in nep-agr, nep-dev and nep-iue
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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https://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2014-27.pdf Revised version, 2015 (application/pdf)

Related works:
Working Paper: Workfare as "Collateral": The Case of the National Rural Employment Guarantee Scheme (NREGS) in India (2014)
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