WSPLs March 26 – Cash transfers saved 150,000+ lives; two papers on conditionalities; supporting farmers with transfers in China; the simulated effects of cash in Zambia; the Finnish quasi-UBI reexamined; sobering evidence on TANF and EITC in the US; the gender-sensitivity of global social protection responses; the long-term effects of maternity leave in Norway; survey results from rural Bangladesh; fiscal policies and climate change in Asia and Pacific; and much, much more…

Let’s start with a big headline! A new paper by Asfaw shows that in the early phases of the pandemic (March-May 2020), cash transfers and other social protection programs helped avoid 3.6 million additional Covid-19 cases and saved 166,690 lives. Those effects are higher in countries that provided more generous support. Bottom line? When examining the effectiveness of social protection programs, “… in addition to the consumption smoothing and other spillover effects of these programs, policymakers should consider the disease containing and mortality reduction benefits”.

Moving to the dilemma on whether “to condition or not to condition”, Mookherjee and Napelb have a theoretical article by favors conditional cash transfers on the basis of, in their view, “largely ignored” dimensions of financing costs and general equilibrium effects.

BTW, Kattel and Mohan have a paper with an original way of thinking about conditionalities – as part of the post-2015 earthquake in Nepal, programs were providing $100 (in lump sum or 2 payments) upon passing a training test on improved shelters for goats. Results? Herd size increased by 20-30%.

In another paper on the same country and shock, Rawal et assessed the effectiveness of Nepal’s post-earthquake reconstruction policies (largely housing for low-income people) and found that “… identification of the poor and vulnerable was not easy and simplistic criteria were inadequate”; also, “… disbursement of top-up grant assistance and subsidized loans could not be as effective as envisaged and hence, inclusion of the vulnerable though well-intended in the policy framework remained limited”.

More on Asia: in China, Liu et al examine the impact of different eco-compensation methods on farmers’ livelihoods and found that cash transfers are more effective than in-kind materials and technical training in improving farmers skills and “family living conditions”, but come second place for enhancing “means of production”.

Moving to Africa, Varghese Paul et al show that in Zambia the pandemic has disproportionately impacted urban areas, and existing cash transfers could reduce poverty by 4 percentage points if implemented in full: “… 0.7 million fewer people are expected to be in poverty if [the cash transfer program] pays benefits to its full caseload, compared to the case if only the current partial caseload is paid”. (Note: an “enhanced” version of the program could drive poverty rates down by 6 pp).

A review of mobile money in Sub-Saharan Africa by Koomson et al finds “…adoption of mobile money is associated with an increase in the probability to send (receive) financial support to (from) families, friends, relatives, co-workers and acquaintances in times of idiosyncratic shocks”.

Any news from high-income settings? Fresh evidence on the Finnish (quasi) basic income trial by Verho et al confirms previous findings, i.e. it “… had minor employment effects at best”. For the UBI-jobs debate, this is both good (no disincentives to work) and bad news (no incentives either).

Two interesting findings from the US: Hahn et al show that only about one-quarter of families experiencing poverty receive TANF (cash assistance), and many eligible families do not participate, partly because of program requirements, navigating the administrative process, and other restrictions –interesting to note that this particularly affects “… young people who lack experience dealing with the TANF requirements and who are juggling competing responsibilities”; and see also the complicated eligibility rules for noncustodial parents and requirements to cooperate with child support enforcement (p.9). Another study by Collin et al estimates the effects of state-level earned income tax credit (EITC) on mental health and behaviors. What did they find? Transfer were too small for a meaningful impact (mean size of yearly state EITC refunds in the sample was $265/person).

Since I mentioned health… Ahmed et al examine results from two rounds of phone surveys in rural Bangladesh and initially found that about 90% of households experienced a negative income shock after the countrywide lockdown. A month after the first call, they detected a deepening and wider prevalence of food insecurity, including affecting groups that were in an advantageous position during the initial survey.

More on health… Bütikofer et al examine the long-term impact on health of introducing paid maternity leave in Norway in 1977. They found that the reform improved a range of maternal health outcomes, including blood pressure, pain, and mental health.

News on gender! Very glad that UNDP and UN Women launched the update of their Covid-19 Global Gender Response Tracker (results are summarized in a global factsheet and the full dataset is available on the dashboard). Any social protection results? About 24% of global Covid-response measures as “gender-sensitive”, meaning that they either target women’s economic security (13%) or address increased demand for unpaid care (11%). And at least 55 countries have introduced or expanded cash transfer schemes that target or prioritize women among their recipients (h/t Aroa Santiago and Silke Staab).

Resources on labor and skills (h/t Michael Weber). Foged et al study the labor market impacts of immigration across 18 high income countries and show that labor institutions shield native workers from distributional wage consequences of immigration, but exacerbate the impacts on average wages in the economy.

More on distributional effects: Hijzen and Salvatori examine the distributional implications from rethinking severance pay in Spain (in the current system, permanent workers who are dismissed from their job are entitled to 20 days of severance pay per year of service). Their report considers a reform that replaces such system with individual saving accounts financed through periodic contributions by employers. The reform yields important effects between firms and workers, different groups of firms and different groups of workers.

What about the future? McKinsey released a report on the future of work post-pandemic: was struck by two key findings, namely that (i) the four sectors most affected by Covid-19 account for 40 to 70% of the workforce (in select European countries, China and India); and (ii) more jobs are being automated as a result of the pandemic, with up to 25% more workers than previously estimated that may need to switch occupations.

Finally, let me share an interesting climate piece: an IMF report by Dabla-Norris et al discusses fiscal policies to address climate change in Asia and the Pacific. Among the many interesting insights, see in particular the international experiences around compensating people and firms for higher carbon prices featuring short highlights from Canada, Sweden, Norway, Singapore, Colombia, and India (p.40-42).

Stay safe and enjoy the weekend!