| Resumen: |
The paper critically reviews the arguments for and against both employment guarantees and income
guarantees when viewed as rights-based policy instruments for poverty reduction in a developing
economy, with special reference to India. Evidence on India s National Rural Employment Guarantee Act does not suggest that the potential for either providing work when needed or reducing current poverty is being realized, despite pro-poor targeting. Instead, work is often rationed by local leaders in poor areas, and the poverty impact is small when all the costs are considered.
Decentralized implementation of the right-to-work poses serious challenges in poor places. The
option of income support using cash transfers also has both pros and cons. Widely-used methods
for finely targeting cash transfers tend to miss many poor people, and discourage those reached
from earning extra income. Yet it cannot be presumed that switching to a universal basic income will reduce poverty more than workfare or finely-targeted transfers; that is an empirical question and the answer will undoubtedly vary across settings, belying the generalizations often heard from
advocates. Nonetheless, more incentive-neutral, universal and/or state-contingent transfer schemes
merit consideration in settings in which existing public spending is skewed against poor people and/
or there is scope for raising taxes on the rich. |
