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Submitted by Shanta on

Lydia: Thanks for your question. I was describing cash transfers as an alternative to other forms of aid to the poor, such as subsidies or the gifts-in-kind you describe. So we are talking about the same amount of aid being given--the only difference is how it is given, in kind or in cash. In this sense, cash transfers do not create any more dependency than other forms of aid. In fact, there is evidence (see the Blattman study mentioned in the post) that they may create less dependency because poor people have the opportunity to invest the money and improve their well-being. Regards, Shanta