An Employment Guarantee as Risk Insurance? Assessing the Effects of the NREGS on Agricultural Production Decisions

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dc.creatorGehrke, Esther
dc.date2020-12-04T18:59:44Z
dc.date2020-12-04T18:59:44Z
dc.date2019-06
dc.date.accessioned2026-07-01T00:34:10Z
dc.descriptionUninsured risk constrains households in their production decisions in many developing countries. Similarly to crop insurance, employment guarantees can support farmers in managing agricultural production risks. Evidence from representative panel data of Andhra Pradesh, India, suggests that the National Rural Employment Guarantee Scheme (NREGS) reduces households’ uncertainty about future income streams because it provides employment opportunities in rural areas independently of weather shocks and crop failure. Therewith the NREGS makes an ex-post labor supply response to agricultural shocks more efficient. Households with access to the NREGS are found to shift their production toward riskier but also more profitable crops. The observed shifts in agricultural production do considerably raise the profitability of agricultural production and hence the incomes of smallholder farmers. The findings are not driven by changes in the labor or cost intensity of those crops, which supports the idea that the causal mechanism underlying the observed changes is indeed an insurance effect.
dc.formatapplication/pdf
dc.identifierWorld Bank Economic Review
dc.identifier1564-698X
dc.identifierhttps://hdl.handle.net/10986/34871
dc.identifierhttps://doi.org/10.1596/34871
dc.identifier.urihttp://hdl.handle.net/123456789/406329
dc.publisherPublished by Oxford University Press on behalf of the World Bank
dc.relationWorld Bank Economic Review
dc.rightsCC BY-NC-ND 3.0 IGO
dc.rightshttp://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.rightsWorld Bank
dc.subjectEMPLOYMENT GUARANTEE
dc.subjectCROP CHOICE
dc.subjectAGRICULTURAL INSURANCE
dc.subjectUNCERTAINTY
dc.subjectAGRICULTURAL SHOCK
dc.subjectLABOR SUPPLY
dc.titleAn Employment Guarantee as Risk Insurance? Assessing the Effects of the NREGS on Agricultural Production Decisions
dc.typeJournal Article
dc.typeArticle de journal
dc.typeArtículo de revista

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