Man or Machine? Environmental Consequences of Wage Driven Mechanization in Indian Agriculture

This paper uses an exogenous shock to wages from the world's largest anti-poverty program to show that higher wages can lead to increased air pollution, likely by inducing farmers to shift into a labor-saving and mechanized production process. Using a difference-in-differences approach on the s...

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Bibliographic Details
Main Author: Behrer, A. Patrick
Format: eBook
Language:English
Published: Washington, D.C The World Bank 2023
Subjects:
Online Access:
Collection: World Bank E-Library Archive - Collection details see MPG.ReNa
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100 1 |a Behrer, A. Patrick 
245 0 0 |a Man or Machine?  |h Elektronische Ressource  |b Environmental Consequences of Wage Driven Mechanization in Indian Agriculture  |c A. Patrick Behrer 
260 |a Washington, D.C  |b The World Bank  |c 2023 
300 |a 101 pages 
653 |a Agricultural Fire 
653 |a Rural Labor Market Shocks 
653 |a Environment 
653 |a Mechanized Agriculture 
653 |a Mahatma Ghandi National Rural Employment Guarantee Act 
653 |a Structural Change 
653 |a Poverty Reduction 
653 |a Air Pollution 
653 |a Agriculture 
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520 |a This paper uses an exogenous shock to wages from the world's largest anti-poverty program to show that higher wages can lead to increased air pollution, likely by inducing farmers to shift into a labor-saving and mechanized production process. Using a difference-in-differences approach on the staggered roll-out of India's Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA), combined with data on nearly 1 million fires, the paper shows that the frequency of agricultural fires increases by 21 percent after the shock. The increase in fires is concentrated in districts that appear more likely to mechanize the harvest. MNREGA did not lead to changes in area planted or tonnage produced in fire intensive crops. The estimates show that nationally, the shock increased the rate of particulate emissions from biomass burning by 30 to 50 percent. The results suggest that absent policies to correct for environmental externalities of mechanization at all stages of development, labor market shocks may lead to inefficient levels of mechanization