The household and individual-level economic impacts of cash transfer programmes in sub-Saharan Africa

Organization(s): FAO
Author: Benjamin Davis, Paul Winters, Silvio Daidone, Sudhanshu Handa
Regions: Sub-Saharan Africa
Country: Ethiopia, Kenya, Lesotho, Malawi, Zambia, Zimbabwe
Year: 2017
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Results from seven recently completed rigorous impact evaluations of government-run unconditional social cash transfer programmes in sub-Saharan Africa show that these programmes have significant positive impacts on the livelihoods of beneficiary households. In Zambia, the Child Grant programme had large and positive impacts across an array of income generating activities. The impact of the programmes in Ethiopia, Kenya, Lesotho, Malawi and Zimbabwe were more selective in nature, while the Livelihood Empowerment Against Poverty programme in Ghana had fewer direct impacts on productive activities, and more on various dimensions of risk management.

In most countries there was a reduction in household participation in casual agricultural wage labour, often seen as an activity of last resort, with reallocation of labour in a number of cases to on-farm activities. Cash transfers did not translate into an overall reduction in work effort or increased dependency on the transfers. In most of the countries, transfers led to increased use of agricultural inputs and increases or changes in agricultural production. Most of the cash transfer programmes led to increased livestock accumulation. In almost all countries, cash transfers allowed beneficiary households to avoid negative risk coping strategies and to better manage risk, partly by allowing beneficiaries to “re-enter” existing social networks and thus strengthen their informal social protection systems. The differences in impacts across countries can be attributed to a variety of factors, including the availability of household labour and programme design and implementation, in particular the level of transfers, the regularity and predictability of payments and the type of messaging associated with receipt of the programme.

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