While government spending on pro-poor community asset creation and income-transfers could have compounding positive effects on poverty reduction, it is important to first study trends in the allocation of funds, particularly as they relate to the susceptibility of the program to political clientelism.

Are ostensibly demand-driven public programs less susceptible to political clientelism even when private goods are allocated? Investigate this conjecture using expenditure data at the local level from India’s National Rural Employment Guarantee Scheme.

India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is the largest public works employment project in the world. Its most direct poverty reduction pathway is through boosting employment and income for the poor.