Author(s): Alexander Ugarov
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This is an open research idea! Claim (10 points)
There is a large productivity gap between rural and urban areas in most developing countries (Gollin et al, 2014). It is not completely clear why this gap exists, but multiple explanations are offered: Policymakers can choose either to support rural areas or to promote migration to cities. Rural workfare programs such as NREGA in India use the first approach, but their long-term equilibrium effects on their participants and their communities is not clear. For example, we know that workfare programs generate large welfare gains for workers but distort local labor markets (Imbert and Papp, 2015). It is plausible that they can also cause suboptimal skills accumulation or prevent workers' migration to urban areas with more productive jobs, which existing studies do not explore. The potential study might explore worker's outcomes within 10 years of being exposed to a workfare program: migration, occupation, income. The variation in workfare exposure can come either from an additional field experiment (potentially based on NREGA) with random selection of treated/controlled administrative units or by linking the information on individuals affected by NREGA program before (such as linked census data). It is important that any study would track workers both staying in the affected locality as well as those migrating to other areas. This idea is inspired by an Ahmed Mobarak conference presentation: (link)
Published: 2023-03-23 17:26:14 PT
Stage: Research Idea
Fields: Labor Economics, Development and Growth
Research Group(s): Playground
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