Let’s start with the perennial question on whether cash transfers affect work incentives… the answer is yes but not by much. A review by Baird et al shows that programs tend to result in little or no change in adult labor decisions. The exceptions are adults living with seniors receiving pensions and on select refugee programs (although to a limited extent and in risky locations). Check out tables 1 and 2 (p.26-27) for handy summaries of the evidence. Similarly, Daidone et al. found significant impacts of the Zimbabwe Harmonized Social Cash Transfer Program on beneficiary agricultural activities, the share of households owning livestock, and non-farm enterprises.
Plenty of vibrant discussions on the role of cash transfers in the ‘graduation’ agenda…
Banerjee et al are back with a new NBER paper on the classic graduation model (a package of assets, training, coaching, and savings). They explore two variants: whether the transfer of assets only would generate similar impacts, and whether access to a savings account and a deposit collection service would generate comparable impacts. Neither outperforms the holistic package. Similarly, a CSAE paper by Sedlmayr et al assesses graduation variants in Uganda--the full package of transfers and training, only the transfers, transfers with only a light-touch training and just attempting to boost savings. They find that cash only was less effective than the more integrated interventions.
Can cash transfers increase trust that citizens bestow upon their government… and even help it work a little better? Yes they can, according to a new paper (and accompanying blog) by Evans, Kosec and Holtemeyer. In 2010, Tanzania launched a pilot conditional cash transfer program, with a randomized roll-out in half of a set of 80 villages. After 2.5 years of transfers, beneficiaries – relative to potential beneficiaries in the waitlisted villages – report a stronger belief that their elected village leaders can be trusted in general, but not their appointed bureaucrats. Beneficiaries are more likely to report that local government leaders take citizens’ concerns into account, and that their honesty has improved over time. Notably, this increased trust does not translate into political activity. Beneficiary households are no more likely to vote in Village Council elections, or attend more Village Council meetings. The research even suggests that the program improves record keeping in the government, but only in sectors linked to transfers (education and health).
Take these two numbers: 165 and 1. The former is the number of children in millions who are chronically malnourished or ‘stunted’; the latter is the number of robust impact evaluations comparing cash and in-kind transfers on malnutrition.
I emphasize ‘comparing’ since there is plenty of evidence on individual cash and in-kind (and voucher) programs, but very few studies deliberately assessing them under the same context, design parameters, and evaluation framework.