Can Latin America Learn from India’s Efforts at Fighting Poverty? The Case of the Mahatma Gandhi National Rural Employment Guarantee Act

• In Event: Inequality and poverty

Abstract

A decade of high economic growth (2003 and 2013) in Latin America produced a significant improvement in the living conditions of the region’s population: Household incomes grew, poverty and inequality rates fell, whereas job opportunities improved. However, as from 2013 the economic situation of Latin America has worsened, especially in those countries with the least amount of financial resources. The effects have been felt in three ways. First in reduced income as a result of fewer labour opportunities caused by a dropping in demand or investment, particularly in infrastructure. Second in reductions in remittances from migrants. Third reductions in social spending. Moreover, investment in basic infrastructure has remained stagnant since the late 1990s. Indeed, from 1990 to 2017 Latin American countries invested on average between two and three per cent of their GDP on infrastructure, much less than the six per cent needed to close the urban-rural infrastructure gap. In 2016, 24.8 per cent of the Latin American rural population did not have access to piped water, whereas 48.9 per cent did not have access to improved sewage systems. The present article explores the feasibility of implementing the National Rural Employment Guarantee Act scheme (NREGA) in the Latin American region. Based on a comparative approach, the paper concludes by arguing that the implementation of a guarantee work scheme in Latin America modelled on the NREGA could greatly improve the irregular employment conditions of the Latin American workforce and contribute to bridge the area’s urban-rural infrastructure gap.

Author

• Augusto S De Venanzi, Purdue University Fort Wayne