Can rural public works affect agricultural wages evidence from india


It has long been hypothesised that public works programmes, in addition to the welfare effect on those directly employed, can influence equilibrium wage rates. In this paper we test the impact of the Indian government’s major public works programme, the National Rural Employment Guarantee (NREG), on agricultural wages.

Using a decade’s worth of monthly data on agricultural wages for a panel of approximately 250 Indian districts, we find that each annual person-day of employment generated by NREG per rural inhabitant in a district increases real daily agricultural wage rates by 1.6 per cent in that district.May 15, 2012


Can public works increase equilibrium wages evidence from India’s National Rural Employment Guarantee?

We find that, on average, the program boosted the growth rate of real daily agricultural wages by 4.3% per year. The effect of the scheme is more consistent with an increase in the growth rate of wages than with a discontinuous jump in wages.

What are the factors affecting wages of farm Labours?

Four major elements affecting wage levels in agriculture can be identified:Agricultural growth.Food prices and food security.Labor supply.Minimum wages.

What is agriculture wage?

Our analysis shows that the farm wage per person per day doubled from INR 83.50 in 1995–96 to INR 167.50 in 2016–17; for non-farm labourers, the real wage grew 74% (from INR 140.80 in 1995–96 to INR 245.00 in 2016–17).

Why are wages low in the agricultural sector?

2 Answers. The wages low in the agricultural sector due to Labour productivity cannot increase in the agricultural sector as the marginal productivity of land goes on decreasing. Therefore wages remain low resulting in poverty.

What are the factors affecting wages of farm Labourers in Palampur?

The wages for farm labourers in Palampur are lower than the wages for farm labourers set by the government due to intense competition. There is heavy competition among the farmers for work in Palampur, so farmers get ready to work for lower wages.

What is the minimum wage set up by the government for agricultural Labourers in India?

Govt to fix minimum wage rate for farm labour at ₹350 a day. The Labour Ministry has decided to fix the minimum wage at ₹350 per day for unskilled agricultural labour in C-class towns in the central sphere.

Why do you think agricultural Labourers are forced to accept low wages?

Agricultural labourers are forced to accept low wages for their work because there is no other kind of work in the village for them.

Why are farmers still poor?

Majority of farmers are poor with low education, vulnerable to physical and economic risks, and financially stressed with zero savings or worse, indebtedness. As agriculture is in itself a risky financial and social enterprise, the pressure for the farming families to stay afloat is saddling.

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