HIGHLIGHTS

• Self-employmentpromotedthroughwomen’sgroupshasoftenbeencitedasapromisinginterventiontotransitionmorewomenbacktothelaborforce,especiallyinSouthAsia

• Thisstudyprovidesempiricalevidenceontheimpactsofalarge-scalelivelihoodsproject-onfemalelaborforceparticipationinIndia

• Theprogramhasimprovedlivelihoodsbytransitioningmorewomenintowork

• Theprogramhasexpandedaccesstocredit,increasedtheproportionofsavings,andreducedinterestratesoncreditforruralhouseholds

• Therearenotableincreasesinthemedianincomeofwomen,acrossthesample

_______________1. Theoriginalpaperisavailableathttps://openknowledge.worldbank.org/

handle/10986/31873

This note is based on the paperLaborandWelfareImpactsofaLarge-ScaleLivelihoodsProgram:Quasi-ExperimentalEvidencefromIndiaby Vivek Pandey, Abhishek Gupta, and Shivani Gupta.1

ConTExT

Acrosstheglobe,womenfaceunequaleconomicopportunitiesandaninequitable burden of the socio-economic consequences of poverty.These trends are further exacerbated in South Asia and especiallyamongstruralwomendueto loweducation levels(skillsandtraining),limitedcreditaccess,anddisenfranchisementwithin thecommunity. InIndia, from1972 to2013, female labour forceparticipation (FLFP)hasdeclinedfrom31.8percentto26.7percent.SimilartrendsofdeclinehavebeenobservedintheruralWorkforceParticipationRatio(WPR)asseenin the lastpopulationcensus from30.79percent in2000-01 to30.02percentin2011.Whenwomenwiththepotentialofbeingemployedorthepotentialtoundertakeentrepreneurialactivities,areunabletodoso,thisleadstolowFLFPwhichthenslowsdownthegrowthoftheruraleconomy.Bettereconomicopportunitiesandenhancedemploymentarealsocitedaskeypathwaystoreducegenderinequality.

According to existing literature, the most important reason for thedeclineoftheruralFLFPinIndiahasbeenareductioninagriculturaljobs,despitetheemergenceofotheremploymentopportunities. Theneedtodesignpoliciesandprogramstoenhancetheeconomicandlivelihoodactivitiesofwomenismoreurgentthanever,andreduction ingenderinequalityandincreasedfemaleempowermenthasclearandsignificanteconomicbenefits.

SouthAsiaAgricultureandRuralGrowthImpactnoteSeries

In recent years, policymakers the world overhave focused on promoting entrepreneurship,with a specific focus on women. It is believedthat entrepreneurship can transition morewomen into the labor force through self-employment and indirectly help by creatinglivelihood opportunities for other women, asfemale entrepreneurs are more likely to hirefemaleworkers.

9How has the National Rural Livelihoods Missionimproved female labor force participation

WoMeN iN tHe WoRkfoRceJANUARY 2020

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_______________2. FormoredetailsonthedetailsofnRLMIntensiveinterventionsee:SouthAsiaAgricultureandRuralGrowthDiscussionnoteSeries1-10,World

BankPublication,2020.

A multi-sectoral approach in SouthAsia that combinesmicro-loansandsavings,assettransfers,businesstraining,andsocialnetworksisquitepopular.Mostsuchprogramsfocus onwomen and are implemented throughwomen-onlycommunitygroupssuchasSelf-HelpGroups(SHGs).Several empirical studies have estimated the welfareimpacts of such community based multi-sectoral rurallivelihood interventions. It is found that an integratedapproach ismore likely to foster sustainable impacts onfemalelaborforceparticipation,livelihoods,income,assets,skill development and other indicators of householdwelfare, while impacts on consumption and income aremoreelusive.

Despite the large-scale and continued presence of thesecommunity development and rural livelihoods projectsoverseveralyears,evidenceoftheeffectsofsuchprogramson key economic outcomes like income, labor forceparticipation and seasonalmigration remains limited.Thestudyreferencedinthisnoteseekstoaddtothisnascentliterature by providing empirical evidence of short tomediumrunimpactsoftheintensivemodelofthenationalRuralLivelihoodsMission(nRLM).

InTERVEnTIon

ThegenesisofnRLMdatestothelate1980s,whenseveralnGos and development agencies such as UnDP,WorldBank,DFIDetc.launchedwomen-focusedcommunityrurallivelihoods programs all over India. Encouraged by thesesuccesses, the Government of India, in 2011, phased outthestrugglingSwarnajayantiGramSwarozgarYojana(SGSY)program and replaced it with nRLM. The new nationalprogram is unique as it adopted a state-specific approachthatbuildsonthehistoryofthestatecommunitylivelihoods

program.Thisapproachwasexpectedtoensurecontinuityofeffortsandintroduceprogrammaticinnovationsthatcanaddresslocalconstraintsandchallenges.

In 2011 the Government of India, with support from theWorldBank,pilotedan`intensive’approachof thealreadysuccessfulstatemodelsin584blocksthroughthenationalRural Livelihoods Project (nRLP). In 2017, nRLP wasscaled-upasnRLMIntensivealloverIndia.UnderthenRLP,additionalteamsweredeployedinthefieldatthesub-districtleveltomobilizepoorwomenintoSHGs.Figure1providesasummaryofthenRLMIntensivetheoryofchange.

Theprogramwasdesignedtoenablelivelihoodsdiversificationatthehouseholdlevelandhelpexpandbusinessactivitiesinrural areas. Itwas expected that eventuallymorewomenwould be able to participate in the labor market andimprove household income. over time, it was envisagedthatthesecommunitygroups,andtheirfederationswouldgradually become an ‘institutional platform of the poor’,and strengthen the voice and negotiating powerwith themarketsofsmallandmarginalproducers.

Since 2012, nRLM has mobilized more than 59 millionwomenfrompoorruralhouseholdsintoSHGs.Themajorityof these women belong to Scheduled Castes, ScheduledTribes andother vulnerable households. Figure2 providesthecurrentmobilizationofnRLMacrossthecountry.

When the household surveywas conducted, the programhad completed the first set of trainings for almost all thebeneficiaries.And by 2016, the project had succeeded inuniversally implementing its first-order interventions ofmobilizingmorewomenintoSHGsinthetreatmentareas,providing low cost credit and basic training.According toproject monitoring estimates, private financial institutions

Figure 1: Theory of Change of NRLM Intensive2

0-6Months

Poor Households

Social Mobilization & Institution Building

•MobilizationofpoorandpoorestHHsintoSHGs

• Regularmeetings

• Basicgroupmanagement,accounting&financialmanagementtraining

• Book-keeping

• Regularsavings

• Regularinter-loaningofsavings

• Basicbusinessplanningtraining

• Preparationofmicro-creditplans

• Reducevulnerability

• Successfulgroupsaccessloansfrombanksandcommunitygrants

•Micro-businessplanneededtoaccessloans

•Higherinvestmentsinproductiveassets

• Retiringofhigh-costdebts

• Demand-basedlivelihoodsinterventionsforwomen

•Higherallocationofintra-householdresourcesforwomen

• SettingupoffederationsSHGs

• Strongersocialnetworks

•HigherFemaleLaborForceParticipation

• Technicallivelihoodsandmicro-entrepreneurshiptraining

•Convergencewithlocalgovernment,privatesectorandsocialentrepreneurs

•Moreproductiveassets

• Increasedincome

All SHG groups

Savings & Inter-loaning

Access to Loans

Social Empowerment

Livelihoods interventions

Producer groupsMature SHG groups Mature SHG groups

Month1onwards Month6onwards Month12onwards Month24onwards

iMpact Note 9: JaNUaRY 2020

_______________3. YearrunsfromApriltoMarch.ThelatestdataistillMarch2019.4. Dataaccessedon9-oct-2018,Source:nRLMMIS(https://aajeevika.gov.in/);1US$=70InR.5. TillMarch2019.6. Intheabsenceofpovertyratesdataatthevillagelevel,proxyindicatorssuchaselectricity,accesstoirrigation,incomesourcesetc.wereused.7. High-valuecropsareallcropsexceptcerealsandmillets.8. Thisfigureisonlyforillustrativepurposetoexplaintheresultsandprovidethepolicycontext.Duetothecross-sectionalnatureofthe

datawecannotestimatethestandarderrorofthedifferenceinWPRbetweenCensus2011andhouseholdsurvey2016-17.

havedisbursedapproximatelyUS$8.7billiontothenRLMSHGs throughout India in 2019 alone (see the progressin Figure 3). As per the authors' estimates, approximatelyInR 6,200 (US$ 95) per household has been disbursedthroughcommunitygrantsfrom2011till2017tothethreestatesof Jharkhand,MaharashtraandMadhyaPradesh thatareapartofthestudy.4

After the selection of the treatment and control group,community and household surveys were conducted inthe three states of Jharkhand, Maharashtra and MadhyaPradesh. Between november 2016 and February 2017,4316householdswerecanvassedacross727villages.

KEYFInDInGS

The number of livelihoods has increased by almost 20.4percent among the treatment households (with averagelivelihoodsof3.8activitiesperhouseholdinthetreatmentareas).Thisincreasedisdrivenmainlybytheincreaseinthenumber of livelihoods of female members (38.5 percenthigherintreatmentareas).

Theincreaseinlivelihoodsispredominantlyduetothelargeand significant increase in the number of self-employmentlivelihoods activities in farm (5.4 percent more womenemployed)andnon-farmactivities(0.7percentmorewomenemployed).

Thisincreaseissignificantwherewomenhavemovedawayfrom casual farm labor towards self-employment-such ashighvalueagricultureandnon-farmbusinesses.Theresultsalso indicate that there is a 8.4 percent increase in thenumberofhouseholdsthathavetransitionedtohigh-valueagriculturalcrops.7

There is a small but significant increase in the number offormaljobswithinthehouseholds.

The studyestimates that thedecline in theoverall femaleWork Participation Rate (WPR) in treatment areas hassloweddownbyalmost5.5%.The impactsareevenhigheramong women of productive age as 7.7 percent morewomen areworking in treatment areas.Therefore, overall13.6percentmorewomenhavebeenretainedinthelaborforce.SeeFigure4.

3.3 3.44.3

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8.7

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

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2016-17Survey (full sample) – matched

Treatment Villages0.459

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Control Villages

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2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Figure 3: Amt. of bank credit accessed by SHG (in USD Billion)5

Figure 4: Changes in female WPR for full village - 2011 to 2016-178

Figure 2: Year wise rollout of NRLM in India (in millions)3

STUDYDESIGnThe study followed amulti-stage sampling strategy at theblock,villageandhouseholdlevelsandexploitsthephasedroll-out of the program to build a control group. It usespropensityscorebasedmatchingtoconstructacomparisongroupasanestimateforthecounterfactualoutcome.Theselection model includes variables that are drawn fromthe literature aswell as the strategic and implementationguidelines of nRLM such as proportion of SC and STpopulation, poverty rate (proxy indicators),6 and villageremoteness indicatorssuchasdistancetonearestdistrictheadquarters. Data for the selection model were drawnfrom primary household and village surveys aswell fromCensus2011andSECC2013-14.

In addition to livelihoods and labor force, there areotheremerging impacts on assets and income.The study foundahugeincreaseintheamountborrowedatthehouseholdlevelintreatmentareaswhereaverageborrowingincreasedmorethantwice,comparedtocontrolareas.

The interventionhasalsoalteredthenatureofborrowing,with more loans being used for full productive purposes(11.2 percent higher in treatment areas).There is also a4.9percentreductioninannual interestrateslikelyduetothelowercostoftheSHGloansortheinterestsubsidiesforgoodrepayment.

While we find an average increase of 2.9 livestock assetsowned, there was no significant diversity in the kind oflivestockassetssince2011.

iMpact Note 9: JaNUaRY 2020

ABoUTTHEIMPACTnoTESERIESThisnoteispartoftheSouthAsiaAgricultureandRuralGrowthImpactnoteSeries,thatseekstodisseminateresearchandanalysisfocusedonWorldBank financedrural, agricultureand foodsystemsprograms inSouthAsia.Serieseditors:AbhishekGuptaandGayatriAcharya.Photographer:RitayanMukherjee.

WearegratefulforthegeneroussupportfromtheSouthAsiaFoodandnutritionSecurityInitiative(SAFAnSI),theBill&MelindaGatesFoundation,MinistryofRuralDevelopment,variousstateruraldevelopmentdepartmentsandtheDepartmentforInternationalDevelopment(DFID).

ThisnotewaspreparedbyDeeptiKakkar(Consultant,WorldBank)andpublishedbytheFood&AgricultureGlobalPracticeatTheWorldBank,1818HStreet,nWWashington,DC20433USA.Website:www.worldbank.org.Forfurtherinformationorcopiespleaseemail:galex2@worldbank.org.

Disclaimer: Thefindings,interpretations,andconclusionsexpressedinthisnoteareentirelythoseoftheauthor(s)andshouldnotbeattributedinanymannertotheWorldBank,toitsaffiliatedorganizationsortomembersofitsBoardofExecutiveDirectorsorthecountriestheyrepresent.

Thestudyalsofindsthatmorehouseholdshavestartednon-farmbusinesses,butdoesnotfindanymeaningfultrendsonemploymentorrevenuesoftheseenterprises.

There isalsoanoverall increase inthemedian incomebyInR 4,700 (US$ 67) but no noticeable impact in overallmeanincome.

PoLICYLESSonSFirst, theprogramneedstobuildon increased labor forceparticipationanduse it toenhance incomegeneration forparticipants by accelerating the technical and livelihoodsinterventions; efforts are also needed to document theimpactsofthesesub-interventions.

Second,thefocusoffutureinterventionsneedstoshiftfrompureaccesstoloanstomoretargetedborrowingandlargerloansizes.

Finally, theongoing and future impact evaluationsof theselarge-scale government programs need to have a broaderfocusonlaborforceparticipationandincome;inparticularto better understand the long-term impacts of theseprograms.

ConCLUSIonThedecline in female labor forcehasbeenamajorpolicychallengeinIndia,especiallytotacklethefallingparticipationin rural areas. As multi-sectoral initiatives implementedthroughwomen-basedgroupssuchasSHGshaveoftenbeencitedasoneofthekey interventionstoaddressthis issue,thenationalRuralLivelihoodsMissionwastailoredtomeettheseobjectives.

Understanding the impact and efficacy of this large-scaleintervention at an early stage is critical from a policyperspective. The program has been able to achieve itsprimary objective of improving livelihoods and bringingmorewomenintothelaborforce,whichhasastrongrippleeffect starting at the participants and impacting entirevillages.

nRLM'sIntensivemodelhasbeenabletoexpandthereachof financial services inotherwiseun-penetratedareasandreduced the average borrowing costs. This has enabledhouseholds to use these loans for productive purposes.However,moreresearchisneededtobetterunderstandthelong-termanddownstreamimpactsofsuchinterventions.