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Month: April 2018

April 20, 2018 (links edition #53)

New evidence on cash transfers. Owusu-Addo et al have a great systematic review on the impact of cash transfers in Africa. Examining 53 studies, the authors look at health determents as the entry-point, but the review is quite multidimensional. Among the results, they found consistent positive program effect on food security (measured in a variety of ways), with effects ranging from 0.17 to 25 percentage points (pp). However, there were no significant impact on malnutrition (underweight and wasting). In terms of health, almost all studies found positive impacts on care-seeking behavior (preventive, curative and immunization services) (e.g., Ghana’s program increased the use of curative health care by 24 pp among children aged 0–5 years). Evidence was more mixed on antenatal care visits and access to skilled delivery (maternal health services). Some programs reported significant reductions in child labor, ranging from 1.8 to 12.4 pp, while others showed little impact. Seven studies reported the impact of cash on adult labor force participation, with only one of them showing a significant effect (shift from agricultural wage labor to family agricultural business). Other stylized findings: significant improvements in birth registration (effects ranging from 1.5 to 37 pp); enhanced beneficiaries involvement in community decision-making (impacts ranging from 3.3 to 22 pp); cash had limited impact upon gendered household decision-making processes; results on reductions on adolescent pregnancy and early marriage were mixed and variable over time; scial cohesion, measured by trust and mutual support, increased between 6 and 11.8 pp; effects on child deprivation, measured by material well-being, were large and ranged from 5.5 to 33.4 pp.

Let’s double down on cash transfers in Africa (h/t Alejandro Grinspun). Daidone et al. assess the impact of the Zimbabwe Harmonized Social Cash Transfer Programme (an unconditional cash transfer targeted to food insecure and labor-constrained households). They found that the HSCT had a significant impact on beneficiary agricultural activities, increased the share of households owning livestock, and augmented the proportion and profitability of households running a non-farm enterprise. Participation in wage and casual labor was not affected, while higher volume of purchases on credit were registered as well as strengthened existing social networks. A new pilot, called Integrated Basic Social Services with Social Cash Transfer (IN-SCT), is designed to understand the impact of a new component (CCTs with soft conditions) added to select households enrolled in the Ethiopia PSNP. In a baseline report, Prifti et al examine existing linkages between production choices, nutrition and consumption behavior in one of the two regions selected for impact evaluation (SNNP).

Speaking of evidence, in a CGD blog Sandefur reviews the flurry of GiveDirectly-Ozler-Blattman cash transfers exchanges in the blogosphere and twitter (e.g., see here and here). His message to the ‘cashonistas’ is simple: don’t panic, cash is needed, and it is ok “… to admit when the new evidence is not quite as clear as we’d hoped”.

From transfers to work. Mvukiyehe has an interesting blog on the impacts of public works programs on employment and violence in three countries – Cote d”Ivoire, Egypt and Tunisia. He finds that programs had positive impacts on economic welfare in the short-term. In Cote d’Ivoire, total employment increased by 12 pp as a result of the program – with similar increases in Egypt’s social services scheme (15pp) and Tunisia (8pp). Incomes grew by 42% in Côte d’Ivoire, 35% in Egypt and 26% in Tunisia. However, welfare impacts in the medium/long-run (12-15 months after program completion) seem limited. Also, the schemes had no impact on short term violence or civic engagement 1-6 months after project phase-out. More on public works: a new Urban Institute paper by Hahn argues that despite the logic supporting work requirements in social protection programs, evidence shows work requirements often fail to achieve their goal of creating economic mobility for those receiving assistance. Drawing on lessons from SNAP and TANF in the US, she claims that work requirements don’t necessarily help people find jobs. Also, the transaction and opportunity costs associated with work requirements can cause people to lose access to vital supports even when they are working.

Three paper on mobility. A new NBER paper by Kerr and Kerr loos at immigration and entrepreneurship in the US. They find that first-generation immigrants create about 25% of the new businesses in the US, but this is as high as 40% in some regions. But, those firms create fewer and lower-quality jobs than in native-owned firms. In other words, they may be very good for boosting but likely not for building wealth. In a UNU-WIDER working paper, Djuikom investigates the effect of internal labor migration on agricultural productivity of rural households in Uganda. His results show that while on average migration positively affects agricultural productivity, there are households for which the effect is negative. The latter are mostly small farmers, who are often more sensitive to the local price volatility. In a new AE article from Bellemare about one of the dynamics that may be keeping the poorest people in rural areas (at least in Madagascar), i.e., the intensification of income from agriculture. Bonus: speaking of Africa’s agriculture, Denno-Cisse and Barrett have a technical paper, forthcoming in JDE, on measuring resilience with an application to pastoralists in Kenya. Specifically, the propose an econometric strategy for estimating individual or household-level resilience from panel data. The method involves computation and forecasting of individual probabilities of satisfying a minimum standard of living. They then develop a resilience measure that enables aggregation of the individual-specific estimates to targetable subpopulation- and population-level measures.

What are the intergenerational effects of social protection reforms? In a new and thought-provoking IZA discussion paper, Dahl and Gielen studying a reform in Dutch disability insurance that dates back to the mid-1990s. Following this reform all recipients under the age of 45 were re-assessed under stricter eligibility criteria, leading to lower benefits and to increased exit from the program. This sharp differential treatment in re-examinations was exploited to learn how the reform affected the children of these individuals. They found that the probability that a child is on insurance as well as the benefits received from it were substantially lower for those children whose parent’s insurance use was reduced due to the reform. In addition, there are positive effects on future labor market outcomes for these children, with a higher employment rate and a higher level of labor market earnings. They conclude that ignoring any parent-to-child spillover effects understates the long-run cost savings of the Dutch reform by as much as 40% in the long run.

Gelb and Mukherjee reflect on the future of India’s Adhaar. They claim that the initiative is at a crossroads. After a remarkable effort to enroll almost the entire Indian population of 1.25 billion in just over half a decade, its impact on privacy and distribution of transfers are questioned. For example, the Unique ID Authority of India which is the custodian of Aadhaar’s database, stated that biometric authentication failure rate for fingerprints (after 3 attempts) was nearly 12% in government programs compared to 5% in banks and 3% for telecom operators. The authors stress that more understanding is urgently needed of the reasons behind such high figure.

Finally, one of the most creative cash transfers comparison I have seen was a study contrasting CCTs and bicycles to incentivize access to education in India (I shared the paper in mid-2017). But Cambodia has now a scheme where cash is provided to protect endangered bird species… and it actually works: Claassen et al show that payments connected to guarding nests – something in between a CCT and public works – increased the threatened bird populations by a factor of 12 compared to unguarded sites.