Preferential Resource Spending under an Employment Guarantee: The Political Economy of MGNREGS in Andhra Pradesh

Abstract

Are ostensibly demand-driven public works programs with high levels of safeguards nonetheless susceptible to political influence? We investigate this conjecture using expenditure data at the local level from India’s National Rural Employment Guarantee Scheme. Focusing on one state where accountability and transparency mechanisms have been employed and implementation efforts have been widely applauded, we find no evidence of partisan-influenced spending before the 2009 election and find that the political leaning of a mandal played only a small part in fund distribution after the 2009 election. Most variation in public works expenditures is explained by the observed needs of potential beneficiaries, as the scheme intended.

Employment guarantee, India, political economy, project expenditures