Does assistance to the poorest households always yield the greatest social welfare benefits? Or should the main goal of a program be to maximize the intervention’s impact? These thought-provoking questions (and trade-offs) are explored by Haushofer et al in a paper on cash transfers in Kenya. To do so, they used machine learning techniques to identify household characteristics that predict either deprivation levels (“most deprived” beneficiaries) or average treatment effects (“most impacted” recipients), and the compared those outcomes with actual effects. Two key takeaways emerge: first, cash transfers have higher effects among the “most impacted” relative to the “most deprived” in a range of dimensions, including consumption (+67%), assets (18%), and income (16%). Second, unless there are very strong societal welfare preferences toward redistribution, in a low-inequality context like the studied village policymakers should “… carefully consider whether automatically targeting anti-poverty assistance, like cash grants, to the poorest of the poor is necessarily appropriate in their own setting”. In other words, cash transfers that reach beyond the bottom of distribution might be societally beneficial.
Speaking of poverty, a systematic review on children and adolescents’ mental health by Zaneva et al found that cash transfers can “… reduce internalizing symptoms of adolescents experiencing poverty”; but cash alone “… may not be sufficient in extreme risk settings and (…) conditions may be actively harmful for the mental health of adolescent girls”.
More on children but from a nutritional perspective: Shonchoy et al show that in urban Kerachi, in-home physical growth monitoring and nutrition counseling (IHGMC) is just as effective for child nutrition than IHGMC complemented by 6 monthly payments of unconditional cash transfers… a reminder that cash transfers don’t always make a difference (h/t Tomoo Okubo). Bonus on urban areas: D’Aoust et al combined household and geospatial data to generate a composite vulnerability indicator for the Port-au-Prince metropolitan area.
Fresh set of lessons from India’s Covid social protection response! Gelb et al examine results from a survey conducted in late 2020 and found no strong differential access to cash and in-kind benefits by income or location. Yet constraints to providing NREGA public works had emerged: the “explosion” in NREGA demand, also driven also by the return of urban migrants to their rural homes, meant that out of about half of eligible respondents who did not participate in public works, nearly 70% had wanted to but were not offered access to the program. Bonus on public works: a podcast features Bertrand, Crepon, Marguerie and Premand discussing results of an impact evaluation of a combined public works and training program in Cote d’Ivoire (full paper available here).
On another jobs-related intervention: Kohler and Hill evaluated the South African TERS wage subsidy program, a measure that reached over 4 million workers during the pandemic. The measure was particularly salient in the early phases of the crisis when it is benefitted 1 out of 7 workers. In addition to coverage, the paper found indicative evidence of a “… significant, positive relationship between TERS receipt and job retention”.
Let’s stay in Africa: Zeufack et al reflect on future priorities for social protection in Africa. The report makes a strong case for social assistance and underscored the importance of increasing coverage, adaptiveness, financing, and data: “… [t]his is the moment for African governments to embrace recent innovations and modernize their social protection system”.
But these are hard times, and the IMF’s new fiscal monitor sets out a number of considerations for leveraging social assistance to weather global price shocks: among them, it recommends that where energy or food subsidies exist, governments “… should gradually pass-through international prices to retail prices especially if social safety nets are not well developed or timely expansion is not feasible”; also “countries with strong social safety nets could use targeted and temporary cash transfers to low-income and vulnerable groups”; furthermore, “countries with weak social safety nets could expand the most effective programs and leverage digital methods” (p.14-15). See also the interesting discussion on how emergency cash transfers (temporarily) reduced poverty in Brazil and the US (figure 1.6, p.11).
Back to Covid: Cho and Johnson have a stellar review of lessons from the Philippines’ experience in reaching nearly 96% of the population with social protection in 2020-2021. But did pandemic cash transfers generate economic multipliers? In Germany, the Covid response involved, among others, 3 cash transfer payments for a total of E450/child: Goldfayn et al found that the first payment boosted spending by 9.5-11.1%, with effects higher for low-income families.
Bonus on Europe: in Poland, Cygan-Rehm and Karbownik show that a one-off cash transfer conditioned on the 1st prenatal visit by 10th week of gestation decreased fetal deaths and increased birth weight. Effects were stronger among the most disadvantaged children. Double bonus: Spasova et al have an excellent paper on social protection for “atypical workers” in 8 countries!
Another paper also assesses the effects of social protection in 8 countries: the ITUC has a new report on financing social protection through different forms of taxation. The paper simulated economy-wide impacts of investing 1% of GDP in Bangladesh, Colombia, Costa Rica, Georgia, Ghana, India, Rwanda, and Serbia, and considered 5 financing scenarios, namely increases in foreign aid as well as higher income, corporate, VAT, and capital taxes. Results for GDP growth, employment, and inequality show that indirect taxes perform worse than the alternatives, and that on average some modest gains are achieved via progressive direct taxation (see figure 2, 3 and 4, page 12-16) (h/t Beatrice di Padua). Bonus: Cobham argues that the pandemic may have opened the “… political space for the first time in decades for significant tax policy changes to fight inequality”.
News on mobility and displacement: in Indonesia, Rakhmetova et al document that cash transfers don’t have effect migration much when in response to annual rainfall shocks; however, when exposed to such shocks for several years, beneficiaries change their behavior and use transfers to move out of affected areas. And on the displacement front, a paper by Juric uses big data to predict the level of Ukrainian refugees: his results foresee 5.4 million displaced people, or nearly half million more than current flows. BTW, the UN has a handy brief on conflict, COVID-19, cost increases, and climate change.
Final mix: a gender event today at CGD discussed “cash, care and data”; a CNBC interview with WBG VP Ghanem covered the role of social protection in the ongoing global crisis (h/t Paolo Belli); and a seminar on April 26 will share the Belgian experience on social sector interoperability.
Ugo Gentilini is from the World Bank’s Social Protection & Jobs global practice. The Social Protection Links newsletter, issued every Friday, distills and discusses a selection of curated resources on the topic, from academic articles to podcasts. The blog is republished on socialprotection.org each week, offering knowledge on social protection to help you stay on top of it — succinctly, regularly and frequently. Previous editions can be found here.