Techniques in Innovative Policy Making: Example of National Rural Employment Guarantee Act in India

Abstract

The problem of social ills such as unemployment, poverty, and accelerating pace of rural-urban migration is not only enormous in magnitude, but also complex by nature in developing countries. This article introduces an innovative regulatory approach that addresses the complexity and scale of such problems. An analytical and decision-making model is presented. This model prescribes reflecting on two or more problems simultaneously. Such an approach is expected to create a fresh opportunity for policy makers and scholars in solving problem scenarios, bringing their vantage point to bear on pressing social matters. The model presented in this article is applied to analyze the NREGA or National Rural Employment Guarantee Act, 2005 in India. This Act represents a novel approach to policy-making and demonstrates the positive role governments can play in labor markets. The design, implementation, and promising initial results clearly challenge existing wisdom on how to make effective policy decisions. The framework presented in the article best explains various facets of this remarkable policy and shows how governments can intervene in the labor markets and correct for imperfections. Pioneering future applications to other social and economic challenges are suggested. Also, implications for research and policy are provided.

Keywords:

• employment guarantee scheme
• innovative decision-making model
• unemployment
• poverty
• rural-urban migration

Notes

¹For more details, please see Allison and Zelikow (1999), Cohen et al. (1972), George (1972), Janis (1982), March and Simon (1958), and Mintzberg et al. (1976).

²Retrieved October 7, 2010, from http://changeanalytix.com/software_streamanalysis.asp

³Learning Organizations are “organizations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together” (Senge, 2006, p.1).

⁴The Maharashtra Employment Guarantee Act, 1977 was brought into force January 26, 1979. The principal aim of the Act was to provide gainful and productive employment to the people in rural areas within the State of Maharashtra, who are in need of work and are prepared to do manual labor but cannot find it on their own. The MEGS was conceived as a citizen-sensitive scheme and it facilitated in reducing human distress over the past three decades in rural Maharashtra. For more details, please see Shah and Mehta (2008), Dev et al. (2004), Dev (1995), Janis (1982), Moore and Jadhav (2006), and Mintzberg et al. (1976).

⁵Wage Employment Programmes in India: Maharashtra Employment Guarantee Scheme (launched on January 26, 1979); National Rural Employment Programme (1980–89); Rural Landless Employment Guarantee Programme (1983–89); Jawahar Rozgar Yojna (1989–99); Employment Assurance Scheme (1993–99); Jawahar Gram Samridhi Yojna (1999–2002); Sampoorna Grameen Rozgar Yojna (in progress since September 2001); National Food for Work Programme (launched on November 14, 2004), and the National Rural Employment Guarantee Act (launched on February 2, 2006).

⁶Ibid.

⁷Retrieved October 7, 2010, from http://indiabudget nic.in/ub2010-11/bs/speecha.htm

⁸One crore = INR 10,000,000 (Indian rupees) = 10 million, INR 44.3 = US$ 1 as on October 7, 2010.

⁹Retrieved October 7, 2010, from http://indiabudget nic.in/ub2009-10/bs/speecha.htm

¹⁰The allocation for 2006–07 (first year of implementation of NREGA) was INR 12,000 crores, of which INR 8,823 crores was actually spent in 200 selected districts. The coverage in terms of the number of districts was enhanced by an additional 130 in 2007–08 and in 2008–09, all the 610 districts were covered, the allocation of funds was INR 16,000 crores and INR 20,000 crores, respectively.

¹¹Retrieved October 7, 2010, from http://www.nrega.nic.in

¹²A field visit and study was conducted by the authors on May 17, 2009 through a personal visit to the site and through a number of unstructured interviews.

¹³One lakh = 100,000 = 0.1 million

¹⁴Retrieved on October 7, 2010, from http://www.nrega.nic.in

¹⁵Retrieved on October 7, 2010, from http://www.indiastat.com

¹⁶For more details, please see Aggarwal (2008), Dogra (2008), Dréze et al. (2008), and Dréze and Khera (2009).