Rural Employment Guarantee Programme in India and Its Impact on Household Educational Decisions: A Focus on Private Coaching

Abstract

Given the well-recognised role of education in the process of social and economic development, this paper uses primary data collected from four villages of West Bengal to evaluate the impact of household participation in the Mahatma Gandhi National Rural Employment Guarantee Act, a large scale public works programme on educational decisions including children schooling and expenditure incurred on private coaching and other educational components. We especially consider private coaching as it has gained substantial importance over the last few years in developing countries including India. The findings from the regressions, which control for the potential endogeneity indicate no significant impact of participation under the programme. However higher days of work and earnings from the programme seem to positively impact on expenditure on private coaching while having no impact on other educational expenditures indicating higher income elasticity of private coaching among educational expenditures. The paper thus emphasizes on the various direct and indirect benefits of the programme which necessitate its effective implementation that can fix the long standing problems of delay in payments and rationing of works. In this context, the recent increase in budgetary allocation in 2018 is a welcome step.

Keywords: MGNREGA, education, private coaching, tuition, West Bengal, India

JEL Classification: I38, I28