2024
Language:
English

Investigate on Moral Hazard: The Impact of Cash Transfer on Household Spending Behaviour

This study aims to examine the effects of cash assistance on consumption behaviour patterns in Indonesia, using the Indonesia Family Life Survey (IFLS) as the primary data source. The study also seeks to determine whether there are deviations in consumption behaviour when individuals receive cash assistance interventions. To address this, a multiple linear regression analysis using the OLS dummy variable method was employed. The results of this study reveal that cash assistance interventions have a positive impact on primary consumption and total consumption among the population. Furthermore, additional findings indicate that cash assistance also has a positive effect on tertiary consumption, such as cigarettes and alcohol. The increase in tertiary consumption suggests the presence of moral hazard among cash assistance recipients.