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Original Research

WELFARE SCHEMES OR POLITICAL FREEBIES? A FINANCIAL PERSPECTIVE

MOHAMMAD RAFI RAHIMI 1, and ARIKA. PRABHAKAR 2.

Vol 19, No 05 ( 2024 )   |  DOI: 10.5281/zenodo.11196624   |   Author Affiliation: PhD Research Scholar, Department of Commerce and Management Studies (DCMs), Andhra University, Andhra Pradesh, India 1; Professor, Department of Commerce and Management Studies (DCMs), Andhra University, Andhra Pradesh, India 2.   |   Licensing: CC 4.0   |   Pg no: 248-265   |   Published on: 15-05-2024

Abstract

Welfare programs have been complex and controversial throughout history, especially in the last century. The state governments tried to bring social security by maintaining the living conditions of the people in an exemplary manner in different perspectives such as education, health, food, and urban development, reducing inequality, and eradicating hunger and poverty. Even now, it is one of the fundamental responsibilities of the governments to provide basic needs to eliminate hunger and poverty. But Social welfare spending is rising rapidly in various states, sparking concerns about sustainability. Critics, including scientists and political opposition, label these programs as "freebies" aimed at garnering voter support. They argue that such initiatives often suffer from inefficiencies, corruption, and poor outcomes. However, some state governments defend them as essential social investments. This study delves into the nuanced distinction between welfare schemes and freebies, scrutinizing their historical underpinnings, theoretical frameworks, and fiscal impacts on state governance. Notably, the study reveals a significant correlation between welfare spending and states' debt-to-GDP ratios, highlighting fiscal ramifications. Concerns about freebies' impact on workforce participation are substantiated, while correlations with unemployment rates remain inconclusive, warranting further investigation. By elucidating these dynamics, policymakers can devise informed strategies to optimize social welfare outcomes while safeguarding fiscal integrity.


Keywords

Welfare Schemes, Political Freebies, Fiscal Impact, Indian Governance, Social Investment,