WSPLs – Feb 26: the multipliers of transfers and pensions; institutional challenges affect cash payments in Nepal; good delivery helps public works implementation during crises in India; informality and social insurance in Africa; the mixed employment effects on cash in Bolivia; 5 reasons to be cautious about social protection expansions in LAC; insurance in Brazil is gets spent quickly; measuring old age poverty; and much, much more…

The multipliers multiply! Last week I opened the newsletter with the economic multipliers of transfers in LAC and OEDC (see Bracco et al here). Newly-released evidence by Pennings unveils the knock-on effects of temporary safety net transfers (in 2001 and 2008) and social insurance (defined as ‘permanent’ transfer) in the US economy: “… impact multipliers [are] around 1/3 for one-off transfers as part of stimulus packages ($0.2–$0.9) and around 1.5 for permanent Social Security transfers ($0.9–$1.9)” (h/t Michael Weber). [Email me for a pdf copy in case you can’t access it].

Moving to Asia, there is a fantastic paper on Nepal written by a stellar pool of Nepali researchers: Pradhan et al illuminate on how institutional barriers to social protection (where higher levels of the state don’t monitor lower levels effectively) affect implementation, particularly cash transfer payments; however, some design choices can mitigate such challenges (like the use of categorical targeting for scholarships).

Let’s stay in the region: what’s the best response to a crisis? Preparedness! An IZA paper by Afridi et al shows that Indian states with better capacities to implement NREGA public works generated relatively higher employment during the pandemic than states with lower delivery capabilities, especially for women – i.e.,  an increase in state capacity by one NREGA workday/person reduced job losses in April-August 2020 by 7% overall and by 74% for rural women.

BTW, working on social protection in crisis-prone areas? Join a new exciting online community of practice (h/t Valentina Barca).

Time for Africa! UNDP, with ILO and WIEGO, has a really nice report on informality and social insurance in the region. There are several insightful lessons, such as the ways in which states can co-finance worker contributions, facilitate access to schemes, manage compliance and incentives, and build trust (see p.32-38). A set of crisp case studies feature Ghana (National Health Insurance), Togo (sector-based mutual schemes), Kenya (Mbao Pension), Zambia (National Pension), Rwanda (Ejo Heza Long Term Savings), Tanzania (National Social Security Fund) and Tunisia (new digital platform). Perhaps one aspect that could have been discussed further is the social assistance-insurance interaction, but it still remains a great report!

What about Latin America? Another crack in the dependency wall! A paper by Vera-Cossio examines the labor incentives effects of the Bono Juancito Pinto program in Bolivia (which provided an annual lump-sum of $25). They found that cash causes both increase and decreases in employment: the former occurred among women recipients, while the latter among males who were “overworked” to start with. Hence, the study really underscores the need to understand initial conditions, as well as the availability of jobs (the program was implemented during a high-growth period) (h/t Amber Peterman).

Speaking of LAC… Barrientos lays out 5 reasons to be “… cautious about the likelihood of a pandemic-driven social protection expansion” in the continent. These include regional policymakers that may prioritize health care systems; insurance schemes having limited effectiveness in a pandemic; transfers being introduced on the basis of time-bound restrictions/lockdowns (and which may retrench as these are lifted); fiscal revenues may be severely affected; and the pandemic having deepened democratic deficits. Yet by accelerating or delaying pre-existing trends, Covid-19 may indirectly facilitate the expansion of social protection.

Bonus on insurance in Brazil: a short VoxDev piece by Gerard and Naritomi finds that workers receiving unemployment insurance spend 20% more in the week they get the payment – that is, “… they fail to smooth consumption in anticipation of the (expected) drop in income when workers exhaust [insurance] benefits, which is associated with a 10–15% drop in consumption”. (Full AER paper is available here).

Moving to Europe, there is a fascinating piece on within-Europe mobility (h/t Michael Weber). Beerli et al study a reform that granted European cross-border workers free access to the Swiss labor market: their paper shows the policy had a stronger effect on regions close to the border, and although many cross-border workers were highly educated, wages of highly educated natives increased. These effects are mainly driven by firms that reported skill shortages before the reform.

News on poverty diagnostics? An interesting paper by Gelders finds that in 32 countries across Africa and Asia, measures of old age poverty often hinge on underlying poverty statistic methodologies and recommends to “… always test the sensitivity of poverty measures to the assumptions made”.

Speaking of poverty, such condition also entails perpetual stress, fear and anxiety: as part of a chilling Time reporting on a looming housing crisis in the US, was struck by a man revealing that “… there’s never been a point in my adult life where I ever thought I would be a hair’s width away from living on the street”.

Final fireworks! Usman tackles the big question of when Africa would get the vaccine (2023?), with plenty of geopolitical issues at play; WFP nicely unbundles the many ways in which it supports social protection (h/t Sarah Laughton); the amazing minds of 5 women economists are featured in Forbes; discover who is Arora Akanksha, the 34-year-old running for UN Secretary General (h/t Dilip Ratha); and the Pacific Conference for Development Economics is coming up (March 12).