With over 63.63% of India present in rural areas 1, it is said that the soul of India lies in its villages. As two-thirds of the Indian population resides in villages, they serve as the backbone of the massive economy. Despite developing considerably since independence, the country remains a largely agrarian economy as it contributes to 18% of the total GDP 2. Dependent on a rural form of employment, most of the economy experiences seasonal unemployment as for most of the year people are left with few sources of income. In addition to that, due to the lack of employment opportunities in rural areas, unemployment rates have been exceptionally high as households are left with meager income to sustain their basic needs, and migration from rural to urban settings has increased. The main cause of unemployment in India is because of the lack of capital skills and training to utilize available resources. As a result of poverty and poor human capital, in both rural and urban areas, people are forced to enter the labor markets at young ages 3. With scarce access to resources such as healthcare and updated infrastructure as well as an increase in unemployment in the country, MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) was introduced to help provide a livelihood to the people and help boost the rural economy.

Initially introduced on September 7, 2005, the National Employment Guarantee Act aimed to promise 100 days of work to over 200 districts which was then extended to an additional 130 districts in the financial year 2007-08. The act was one of the first to try and provide an economic safety net to a huge chunk of the population through a right to work. This was then updated to the Mahatma Gandhi National Rural Employment Guarantee Act in 2009 as it spread to the remaining districts covering all 645 rural districts of India and offered an additional 50 days of unskilled manual work in areas where natural calamities had been notified. The implementation was broken up into phases targeting the most backward districts first in phase one, 2006-07. The primary goal according to the 2005 gazette of the scheme was to enhance the livelihood security of rural households to guarantee at least one hundred days of wage employment in every financial year to every household whose adult members volunteered to do so.

Employment in rural areas, a form of poverty reduction program has been followed in India since after independence, but MGNREGA was the first of its sort which could be considered the largest in terms of its outreach and impact on the overall economy and rural society 4. The scheme was introduced by then Prime Minister P.V. Narasimha Rao to boost employment in the country aiming to generate more employment in the agriculture sector, improve infrastructure in rural areas, and enhance food and income security in the underprivileged sections. It also aims to strengthen natural resource management by addressing the root problems of chronic poverty, drought, deforestation, soil erosion, and so forth to formulate better and increased sustainable development. The original scheme was devised taking inspiration from the Maharashtra Employment Guarantee scheme introduced during the 1970s. As the state faced a massive drought, a large number of people needed jobs and resources. The government found the best way to empower people against the drought was by providing an increased number of jobs which helped the people gain greater access to basic household needs. Both schemes aimed to provide social safety nets to the rural poor and marginalized groups by generating greater employment and creating durable assets such as roads, canals, ponds, and wells to increase resource availability and accessibility 5.

The MGNREGA marks a clear demarcation between supply-driven work-based employment policies and right-based demand-driven policies as it sets a transition to the latter. The scheme promises at least 14 days of continuous employment with not more than six days in a week counting as a singular period of employment. The act, further, stipulates that a minimum of one-third of the beneficiaries are to be women who have been registered and have requested work under the scheme and also ensures that if at a site children under the age of six are accompanying women then they must be allotted a worker to look after them who would also be paid the minimum wage. Under the scheme, as mandated by the Ministry of Rural Development, Government of India w.e.f. 1st April 2024, a minimum wage of Rs. 374/- is paid equally to both men and women workers. 90% of the expenditures incurred by the Mahatma Gandhi National Rural Employment Guarantee Program would be handled by the central government while the state government is mandated to contribute the remaining 10%. All unemployment allowance arising when employment is not provided within 15 days after registration would be borne by the respective state government.

The paper seeks to analyze the impact of MGNREGA among women in rural areas especially on their employment, livelihoods, and independence. The paper will look at several secondary sources of data over the years since the implementation of the policy and try to draw relevant patterns as well as understand the need for the policy in India's socio-economic context. The following section will focus on the political-theoretical backdrop of the policy to understand how debates about democracy and development shaped the formation of the scheme. With employment at the center of the political framework, it becomes crucial to factor in how it influences the relationship between democracy and development. The paper also assesses the shortcomings of the policy in implementing a robust assistance scheme for women entrenching democracy at the last mile.

The idea of employment stands at the center of Indian polity as the government uses employment generation schemes as a means to solve issues of resource unavailability and provide better living opportunities for the people. However, in the ever-changing socio-economic backdrop of India, the nature of employment has also changed as there is a drastic change in the economy. There is a shift from a largely agriculture-based economy to a boom in the non-agricultural sector and an increase in tertiary sectors such as manufacturing and services. Singh (2017) 6 argues that while employment is the most significant stakeholder in poverty alleviation and national development, this effort in employment generation in these sectors has been harmful to employment in other sectors, especially agriculture.

According to the economist Amartya Sen, the nature of employment has also changed over time. Three separate aspects of employment ensure a positive impact on both parties involved. The employee gets an income, they are recognized for their work and there is a production of goods and services 7. Despite employment being the primary driver of economic growth, the classical understanding of development dictates that this is done naturally through the market forces of demand and supply instead of artificial stimulation through governmental intervention. However, it is debated that there would be increased economic growth if the government intervened to generate employment which would boost productivity and growth. This leads to a conflict between development and democracy 6.

Democracy is a form of governance based on political equality arising from the idea of self-determination. Development is betterment in living styles of people in all spheres including social, political, economic, and cultural. It works differently for individuals usually starting with education and employment. According to the political economist Pranab Bardhan, the relationship between development and democracy is convoluted and has both negative and positive influences on the development of economies. While multiple claims have been made about democracy slowing down the pace of development, others argue that fatal mistakes have been avoided in developmental policies due to the restrictive nature of democracy 8. For the country to develop and progress, democracy is often argued as an important factor as it is seen as a bridge for the people to express their needs and allow for government intervention and the scheme is an example of it. As democracy and development interact, the scheme works to provide rural employment aimed to aid rural development by increasing local infrastructure as well as increasing purchasing power in rural areas.

Amartya Sen in his book ‘Development as Freedom’ talks about economic growth of countries by observing their trends and analyzing how different styles of government can impact how the economies grow. Comparing India and China, the difference in economic growth is attributed to how effective the government is in its role as an authority with control over the market. When talking about economic growth, China was able to progress faster to a greater extent under an authoritarian regime allowing for swift decision making and policy implementation. This however came at the cost of individual freedom and personal opinion, something highly regarded in India. For India, while economic growth is slower, the democratic framework allows the citizens more freedom and power and fosters greater governmental accountability to the public. In terms of other development factors as well, such as taking control in matters of crisis, India would perform better as it has a better-established connection with the citizens.

In a country like India taking into context the socio-economic settings, it becomes imperative to introduce policies such as the MGNREGA to ensure social equality and that the country progresses sustainably. As a consequence of British colonization, after independence, India took a long time to come out of extreme poverty as the market demand and supply supported the rich and not the poor. In a country like India where 41.6% of the population was below the poverty line in 2005, an employment generation scheme became very important. The outcome of MGNREGA would help in the growth and development of rural sectors. This also leads to a general increase in living standards. For activation of this chain reaction, democracy is an important variable. It all boils down to government intervention which is possible only when the government works for the common public. The scheme attempts to bridge the ideas of employment, democracy, and development. It also follows Rawl's theory of justice. The latter stated that,

MGNREGA aligns with both requirements as the act promises employment to help facilitate basic needs as well as leads to the development of necessary assets such as roads and wells which would also increase the reach and reduce the difference between rural and urban infrastructure. Other than that, the act ensures that women get a greater opportunity at securing jobs and that their children are provided with childcare if necessary. Additionally, the scheme has a minimum waiting period of 15 days after which the individual would be provided with either jobs or unemployment monetary benefit.

In addition to economic constraints, women in developing nations like India experience systematic oppression that emanates from strongly ingrained gender roles including limited access to healthcare, education, and decision-making. Since women have been classified as the least advantaged group by these societal hierarchies, it is essential that developmental policies like MGNREGA give priority to resolving these disparities. Even while the scheme offers benefits like daycare and equal pay, its ability to break down gender hierarchies is still being fully utilized. MGNREGA must incorporate a stronger gender focus by guaranteeing women's active involvement in the planning and implementation to be effective. In addition to addressing their distinctive challenges this would strengthen their positions in the social and economic fields and promote inclusivity.

One of the major stakeholders in any scheme targeting rural development through employment generation is women as their participation has a direct correlation with the purpose and sustainability of these schemes. Women’s roles in rural society are often perceived along the lines of traditional gender roles that limit access to education and employment. MGNREGA offers a way for them to escape these boundaries and enhance economic independence and self-sufficiency. By empowering women through employment, living standards increase and there is a ripple effect in the economy where women are better able to provide for their families’ health, education, and well-being. In a democratic society, ensuring that women have equal access to employment opportunities is vital for achieving broader goals of social equality and inclusive development. The scheme aims to be inclusive and oriented towards women including provisions such as childcare and equal minimum wage. The next section will examine the specific impact of MGNREGA on women’s participation and resulting socio-economic changes.

MGNREGA is a very widespread scheme as during the year 2013-14, 3.8 crores households were provided with employment with 137 crores per on-days of employment being produced. Of the 135 crore people who registered, 73.33 crore were women. Of the total of 111 lakh jobs that were taken, 11.7 have been completed and the other is in progress. The scheme was a deal-breaker as even in the first phase of the implementation of the Mahatma Gandhi National Rural Employment Guarantee Act 2007-08, 2.10 crore people were able to secure 100 days of employment 9. While the scheme got overall employment for everyone with minimal discrimination, it was especially helpful in the development of women and their lives as it gave them a lot more freedom and helped them enter the workforce as well as society.

Given the socio-economic context, India’s female participation rate is at a consistent low hitting 30% in 2005 when the policy was initially introduced. Since the economy was shifting from a largely agriculture-based economy to being more production-based, these rates dropped further since women could not work in factories and were not needed as much in fields anymore. Women in the rural area are less likely to engage in non-agricultural work due to factors like low literacy rate which is 50.6% for women as compared to 77.1% for men. Additionally, limited experience outside of agriculture and a perceived lack of skills are other factors that limit the participation of women. Concerns about the physical demands of work, combined with fear of social stigma or harassment, further discourage their participation.

According to Sanghi, Srija, and Vijay (2015) 10, as family incomes increase, there should be better education facilities for women helping them integrate into the workforce with higher chances of securing jobs and sustaining them. According to Goldin (1994) 11, there is a U-shaped curve showing the participation rate of females in the context of economic growth where economic growth is not linear. Initially, as economies transition from agrarian to industrial, women's participation declines due to social norms and lack of suitable jobs. As economies further develop and education improves, women re-enter the workforce, leading to a U-shaped pattern of participation over time. This however does not hold in the case of India as established by Agarwal and Daksha Joshi (2015) 12, as higher literacy rates along with improvement in per capita income did not improve the female participation rate and the cause of this has been attributed to several factors such as migration and household duties.

An explanation for the low female participation rate lies in the strict gender roles that influence social norms in India. They often confine and restrict women to roles primarily revolving around unpaid care work such as managing households and taking care of children and the elderly 13, 14. This division of labor results in women having less time to devote to the workforce and leaves fewer opportunities to engage in paid labor. According to Bardhan (1979) 15, unmarried women are more likely to be working in the labor force whereas when they get married, their primary ‘objective’ becomes caregiving, and they are left with fewer resources for paid work. Decisions about women's employment as well as their overall well-being made after marriage are also influenced by the number of dependents in their household and views of male relatives 16. Especially in the case of strict traditional families carrying staunch patriarchal views, the woman does not have autonomy over the decision to work and is reliant on what her family decides. Dasgupta and Golder (2005)17 also found an inverse relationship between the number of children and the likelihood of women working, as the number of children increased, the women’s involvement in paid labor tended to decrease. This is because raising children is a time-consuming task in itself reducing the time available to provide paid labor.

The scheme has helped empower women as it has contributed significantly to increasing female participation in the workforce. According to Pankaj and Tankha (2012) 18, the scheme has helped correct the gender skewness to some extent by its special inclusions specifically for women. Gender skewness in India is the imbalance or disparity in the male-to-female ratio due to practices such as female infanticide which resulted in the women-to-men ratio declining. This is because of the deep-rooted cultural and social norm of favoring a boy child over a girl child as the former are viewed as the carriers of the family name and property and often results in neglect of girl children in terms of healthcare and education. Since men are usually the sole breadwinners of families, they are regarded as higher in status than women who are not a part of the workforce. As the scheme provides women the opportunity to work at the same wages as men with additional benefits like on-site care for children under the age of 6, women are more incentivized to work and contribute to society.

This results in women having a stable source of income which is crucial in improving their status within their family and communities. Economic independence also reduces their reliance on male family members challenging traditional gender norms that prioritize male children because of their ability to provide for their families. It is particularly helpful for female workers as it reserves at least one-third of the jobs available for women making sure they get the work locally as well as provide on-site care for children under the age of 6 years. Additionally, the minimum wage guaranteed often surpasses real wages received by women which implies that MGNREGA can contribute to women’s economic and social betterment and empowerment as they receive higher wages and have greater incentive to participate in the labor market.

As found in an interview carried out across worksites in Northern India by Khera and Nayak (2009) 19, more than half the women working would have never worked outside their houses had they not gotten the opportunity to do so through MGNREGA. This is due to several reasons such as previously discussed gender roles but also lack of job opportunities and social perceptions. There was a lack of jobs in several areas because of being remote and usually inaccessible. While men could migrate to bigger cities for work and provide income for households that way, the same is not an option for the women who need to also take care of familial responsibilities. Since MGNREGA is an employment generation scheme, it also ensures new work opportunities are available in all fields including the agricultural sector under the building of durable assets such as irrigation systems and harvesting models. This simply increased availability of work for all, especially women in these remote areas who had no other availability of paid labor. Since the scheme also had several concessions for women, the social perception of them not working changed and improved. The government’s promotion of MGNREGA has included messaging around the importance of women’s participation in the workforce. This has helped shift public perception, making it more acceptable for women to work outside the home.

Unemployed women have to rely on their male relatives for financial resources. Staunch traditional practices such as dowry which is payments or gifts given from the bride's side of families to the groom as a way of economic and financial security in the new marriage as assets perpetuate insecurity for women. The practice of dowry however is inherently transactional and promotes not only objectification of women as they are viewed as commodities but also reinforces their economic dependence on their male relatives. This in turn established a strong gender-based power imbalance and left women with little to no control over household financing or personal spending. The scheme has also increased financial literacy and independence as in most cases, wage payments were done directly into women’s bank accounts instead of the male members of the household. MGNREGA was a main source of employment in contributing greatly towards reducing female dependence on men in the district of Warangal, Telangana 20.

In Odisha, women have benefitted through access to income for their own and familial needs. This has also increased community-level participation through increased presence at the Gram Sabha and participation in local governance. Being a part of the workforce has helped shape the identities of multiple women as they have gained confidence as well as independence in the way they live and work. Traditionally, women were not part of Gram Sabha because of a lack of awareness of their rights as well as being looked down upon for doing anything outside of their household duties. However, as women entered the workforce, they gained more conviction in their abilities and were closer to par with men in terms of wages and financial stability, they were able to be more active in the local governmental processes 21.

Keerthi and Kamala (2016) 22 also noted that women have benefited greatly from the scheme in attaining financial autonomy as it provided them with more choices and capabilities in terms of finances as previously discussed as well as increased ability to invest in their children’s education and manage their finances. It also led to an increase in their bargaining power and self-confidence. It was also observed that increased participation in the labor force was strongly correlated with substantive positive effects on grade progression, reading, and math scores among children in Andhra Pradesh (Mani et al., 2014) 23. Using the same dataset, Afridi et al., (2016)24 found that increasing labor market participation of mothers through MGNREGA meant that children spent increased time in school and were able to receive better educational opportunities.

As per Kar (2009) 25, after the introduction of the MGNREGA, women's empowerment improved in three dimensions (i) increased consumption by women, (ii) increased say in households, (iii) increased political participation. This is because as they become financially independent, they can make decisions for themselves about their consumption patterns. Since they are also contributing equally to household finances as their male counterparts, they have an equal say in household finances (which can also break the women's illiteracy cycle as women may want their girl child to get equal opportunities as a boy child). Their participation in the community also increases as they are also impacting the community by assisting in manual labor for the building of facilities.

MGNREGA has enhanced women's consumption patterns by providing them with stable income, which allows them to spend more on essentials like food, healthcare, and education. The increased income has enabled them to invest in small-scale businesses and save for future needs. This economic empowerment has strengthened their role in local governance, as women increasingly participate in Gram Panchayats and other community-level decision-making bodies with decisions that are more oriented toward societal growth and infrastructure like advocating for improved schooling and social security measures. With financial independence, they have gained more confidence to voice their opinions, advocate for community needs, and challenge traditional gender norms, thereby contributing to a more inclusive and equitable local democracy. The scheme has a lot of benefits for women and society overall. However, it has scope for improvement which will be discussed in the following section.

Despite having multiple positive benefits and being one of the most effective development schemes in India, the scheme lacks in various significant sectors. There are mixed opinions on whether or not the MGNREGA would help girls spend greater time at school as Das and Singh (2013)26 found that older girls faced a decline in schooling as women’s participation in the labor force increased. Bárcia De Mattos and Dasgupta (2017)27 corroborated that data as they found that while initially, the time spent at school by children increased, by the 33rd day, this would change, and older girls would spend less time at school. The reason for this according to both studies is how gender norms dictate society and how we view women’s ‘traditional roles’. As the women enter workforces, there is a vacancy for the primary caretaker of little children. This duty then automatically falls on elder daughters as they are tasked with looking after their younger siblings. This would result in a generational disadvantage to girls from poor households as they would either lack proper fundamental schooling or would be made to drop out to care for their younger siblings and the household. This is perhaps one of the biggest shortcomings of the MGNREGA in that it fails to facilitate child care and rearing services to the women at the worksite despite there being a special provision included in the original scheme. To solve this issue, there needs to be increased infrastructure to aid women in taking care of their young children ensuring that their contribution to the labor force is not an opportunity cost to the older girls and their education.

Furthermore, in households that had a single breadwinner, daily wage jobs were more prominent than participating in the MGNREGA. However, due to the wage gap disparity for women, when there were two breadwinners, the man would work a daily wage job while women usually obtain jobs through the scheme. This implies that the scheme has different levels of success rates seen across genders. For men, it is not effective and is more of an option of the last resort as well as accessed by the poorest households only. This is a stark contrast to women as many of them start working under the MGNREGA and while they come from lower income groups, they were not part of the poorest households. While the scheme tries to be accessible to all groups, it is much more effective for women than for men.

Additionally, while the scheme promises funds for a lot of amenities like safe drinking water, resting places, changing rooms, first aid equipment, and recreational facilities for children, however, different studies show that none of the facilities were present at the worksites and the women working were not satisfied with their working conditions as they were not provided with all that they were promised 13. The scheme also was inefficient in terms of the supply of labor as it was unable to allocate for all workers applying for the scheme. One of the best-performing states under MGNREGA, Rajasthan, experienced a sudden halving of the expenditure on MGNREGA between two fiscal years. Initially, in 2008-09, there was high output with almost 75 percent of households who worked under MGNREGA getting 100 days of work. However, there was a sudden fall in the number of people applying and funds in 2010-11. The total expenditure of the state on the MGNREGA was almost half of what it was in 2008-09.

The MGNREGA is a demand-driven scheme, meaning that the government only employs those who actively request it. Initially, local wages were lower than those offered under the scheme, leading to a high demand for work. However, as local market wages rose above the scheme’s wages, workers began shifting back to the private labor market. Although MGNREGA's demand model gives workers control over how the scheme operates, factors such as unchanged climate conditions, a lack of new employment opportunities, and a significant portion of the population living below the poverty line (16.05%) indicated that demand should have remained strong. Chopra (2014)28 and Himanshu et al. (2014)29 identified that the drop in demand was not due to a lack of interest but rather the government's inability to meet the rising demand for work. While only 15% of households were denied employment in 2009-10, this number surged to 32% by 2011-12, according to NSS data, reflecting unmet demand for MGNREGA employment.

The scheme was expected to reduce distress migration from rural areas by providing timely payments, but this objective was not fully realized due to irregular work availability and frequent delays in wage disbursement 30. Workers expressed frustration with the uncertainty of payments, with some preferring to work for lower but assured wages on private farms. As one worker explained, “I would rather work for lower wages on a private landowner’s farm and be assured that I will get my [lower] wages at the end of the day, than work in MGNREGA and not know when and how much [higher] wages I will receive.” 31. Additionally, Rajan (2016) pointed out that while MGNREGA helped alleviate poverty, it also contributed to inflationary pressure on food prices, as rising agricultural wages increased production costs. This, coupled with Minimum Support Prices (MSP) pushing farmers to produce more, led to a shift toward mechanization in agriculture, and machines became more cost-effective than hiring labor at higher wages 32, 33, 34.

MGNREGA illustrates how government intervention can effectively stimulate economic growth by directly enhancing rural employment and bolstering local economies. The direct intervention has increased purchasing power, which consequently fueled additional economic activity. However, while some contend that democracy may hinder development, others argue that it serves as a safeguard against significant policy missteps, thereby fostering a responsive and balanced government. MGNREGA embodies this democratic ethos by generating employment opportunities that not only improve infrastructure but also enhance local purchasing power, thus making substantial contributions to rural development. MGNREGA upholds democratic principles through its inclusive and responsive framework, affirming a commitment to both economic advancement and individual well-being.

MGNREGA has significantly empowered women by offering equal work opportunities and wages alongside benefits like childcare. This scheme has enabled many women, traditionally confined to household roles, to achieve financial independence and confidence, altering societal views and encouraging their participation in local governance. Wage payments directly to women’s accounts have strengthened their financial literacy and autonomy, enhancing their influence within households and communities.

The Mahatma Gandhi National Rural Employment Guarantee Act has proven to be a powerful tool in strengthening rural sustainability by addressing core issues tied to persistent poverty and unstable infrastructure. With millions securing 100 days of employment, the program achieved notable success in uplifting communities and providing sustenance and financial independence to rural women.

However, the scheme faces challenges. As more women join the workforce, older daughters in economically disadvantaged families often take on caregiving roles, risking setbacks in their education. Issues like irregular work availability, delayed wages, and payment uncertainties have hindered the program’s effectiveness, particularly in reducing distress migration.

Overall, MGNREGA demonstrates the positive impact of government intervention within a democratic framework, highlighting how focused policies can drive economic growth and foster social change. Yet, it also underscores the delicate balance between democratic ideals and development, showing that with targeted political efforts, meaningful progress in both economic and social realms is achievable. It underscores the fragile balance between democracy and development demonstrating that with correct political measures, significant progress in economic and social spheres can be made.