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.

This paper uses a three-round 4,000-household panel from Andhra Pradesh together with administrative data to explore short and medium-term poverty and welfare effects of the 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, employing 55 million households in 2010-11. The program places an emphasis on rural poverty reduction, granting rural households a legal right to employment of up to 100 days per year in public works programs.

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.