India’s Rural Employment Guarantee Scheme – How does it influence seasonal rural out-migration decisions?

Abstract India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is the largest public-works based rural livelihood programme in the world. One of the important policy objectives of the Scheme is to curb rural out-migration by guaranteeing demand-driven employment opportunities for 100 days in a year in rural areas. This paper uses a large sample survey-based nationally representative data set and different probability models to investigate how MGNREGS influences individuals’ seasonal rural out-migration decisions. The results reveal that contrary to the policy objective, participation, the extent of participation and earnings from the Scheme increases an individual’s propensity to out-migrate. However, the Scheme serves broader and equally critical socio-economic goals of empowerment through income security and positive network effects. MGNREGS, on the one hand, significantly drives the decisions of aspirational migration of rural individuals, particularly females and the relatively advantaged. On the other, it curbs distress migration of the relatively disadvantaged by providing them with basic livelihood opportunities within the rural areas. Based on the findings, the paper draws several policy implications and discusses key policy imperatives towards expanding the scale and scope of the public-works Scheme.