Discussion: Can public works programs help to reduce poverty?

The LinkedIn community has debated the research compiled by Laura Zimmermann in her article on public works programs and poverty.

According to Zimmermann’s piece, the success of public works programs in reducing poverty depends on their design and implementation. Key design factors are: properly identifying the target population; selecting the right wage; and establishing efficient implementation institutions. In practice, however, the effectiveness of these programs can be flawed by corruption or mismanagement. As such, the impact they have is variable, and they often work better as safety nets.

Social entrepreneur Jeff Deasey strongly supports public works programs, asserting that "spending on infrastructure and the employment of citizens at liveable wages is the only effective means of reducing poverty."

However, others are less convinced. Professor Steven Deller feels that public infrastructure is "a necessary condition for economic growth" but is "not sufficient." He notes that investments are generally made in growing suburban areas, leaving little money for older infrastructure in cities. Similarly, consultant Jim Jacobs feels that "government spending doesn’t do anything [to help] long term issues." 

Mysore Krishnamurthy Ranganath highlighted the issue of "third-party" agencies which can skew the allocation of money in public works programs, and lead to greater levels of exploitation. Workforce development specialist Colleen LaRose and constultant Ross Spalding also picked up on this point, noting that unions may not always prioritize the workers’ best interests.

Meanwhile, economist Neil Bliven highlights the fact that different policies and programs need to be properly evaluated "to assess [or] predict their relative usefulness." Investor Robert Burk also suggests that a deleveraged investment strategy may help to lower debt and increase investments in job creation programs.

What do you think? Share your thoughts on Twitter or on our LinkedIn group.