Public works programs and labor market outcomes

Original source

Jared Perlo

Public works programs and labor market outcomes (2024)

secondary policy synthesis · J-PAL Policy Insight

Permission for School’s use is unestablished.

Used in these cards

Asset Accumulation and Savings Persistence

"Participants in PWPs increased their savings or assets compared to nonparticipants in nine of ten studies that examined savings or asset accumulation, measured at least several months after program completion. The extra income gained during the PWP allowed participants to have more savings or assets in the medium and long term."

Gender-Differentiated Employment Gains

"A few PWPs were particularly beneficial for women, especially in areas with low levels of female employment and limited job opportunities for women. For example, in the Democratic Republic of the Congo, increases in women's employment drove overall increases in participants' likelihood of being employed and in their average number of hours worked."

General Equilibrium Wage Spillovers

"Though the NREGA program in India increased earnings for participants, 80 percent of this increase came from boosted private sector earnings. NREGA's wage rate likely affected this private sector earning increase, as NREGA paid participants above prevailing market wages."

Heterogeneous Impact Disparity

"In the Ivory Coast, for example, the quarter of participants who experienced the greatest program impact saw their short-term earnings increase 2.2 times that of participants in the lowest quarter of program impact."

Labor Substitution and Foregone Earnings

"The increased income experienced by participants usually represented only a fraction of the PWP's overall transfer amount. This suggests that PWP participants often reduced their time spent on other income-generating activities while participating in PWPs."

Migration Liquidity and Retention Duality

"When researchers tracked participant savings in Comoros, participants' increased resources helped unlock migration opportunities for marginalized groups who would otherwise not be able to afford migration expenses. However, in a quasi-experimental study from India, researchers found that the PWP decreased internal migration using spatial modeling techniques."

Multi-Component Training Bundling

"In one evaluation from the Democratic Republic of the Congo, PWP participants who received hard-skills training and an incentivized savings scheme experienced the largest positive impacts on the likelihood of having a job and on savings. However, researchers did not observe the same positive effects for participants who only received the skills training."

Post-Program Self-Employment Transition

"In the Democratic Republic of the Congo, PWP participants worked 16 percent more days in self-employment compared to nonparticipants, as measured over a year after the PWP ended."

Psychosocial Value of Employment

"Refugees who were randomly assigned to receive a small daily wage in exchange for work experienced strong psychological benefits compared to participants who received the same amount of cash but did not work."

Reservation Wage Escalation

"In an infrastructure-focused PWP in Tunisia, for example, participants experienced a five percentage point decline in the probability of engaging in any income-generating activity compared to nonparticipants five years after program completion."

Self-Targeting Workfare Mechanism

"Given PWPs' demanding labor and time commitments, and because PWPs generally pay at or below minimum wage, individuals who have access to alternative income sources should theoretically avoid these cash-for-work programs. In comparison to traditional cash transfer programs, PWPs are thus thought to better target people most in need of financial support."