Photo Curtsey: The Hindu A recent article in the Times of India by Dilip Abreu, Pranab Bardhan, Maitreesh Ghatak, Ashok Kotwal, Dilip Mookherjee and Debraj Ray poses a rational argument against phasing out the National Rural Employment Guarantee Act. Here are some of the excerpts from the article. The author’s say, “If, for the sake of argument, workers do currently earn Rs 80, it is only true that the gain for the NREGA worker is Rs 50. However, what matters is the gain, direct and indirect, for all workers. In this scenario, there will typically be a wage increase (though not “by leaps and bounds”, as attributed by BP to mysterious propagandists), which benefits all employed workers. This is possible even when NREGA employment is wholly concentrated in the slack season (if higher slack earnings tighten peak labour supply). Even small increases in the market wage translate into large aggregate benefits, given the size of the labour force under consideration.” They also talk about the other non-transfer benefits of NREGA like assets creation and empowerment of women who work for NREGA, “Rural roads, soil conservation, flood control, groundwater recharge and land improvement projects may not shine as brightly as the smart cities...Read More..