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Our Daily Bread What is the Evidence on Comparing Cash
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Our Daily Bread, What is the Evidence on Comparing Cash versus Food Transfers. Ugo Gentilini 1, World Bank Social Protection and Labor Global Practice ugentilini worldbank org The author is grateful to. Ana Veronica Lopez for her research assistance Special thanks go to Akhter Ahmed Jenny Aker Harold Alderman. Carlo del Ninno Aulo Gelli Margaret Grosh Matt Hobson John Hoddinott Phillippe Leite Hideki Mori Philip. O Keefe Robert Palacios Jamele Rigolini Susanna Sandstrom Kalanidhi Subbarao Levan Tchatchua Ruslan. Yemtsov and Eric Zapatero for their precious comments and support The paper only reflects the personal views of. the author and not necessarily those of the World Bank. Abstract This paper reviews key issues in the cash versus food debate including as they relate. to political economy theory evidence and practice In doing so it benefited from a new. generation of 12 impact evaluations deliberately comparing alternative transfer modalities. Findings show that differences in effectiveness vary by indicator although they tend to be. moderate on average In some cases differences are more marked i e food consumption and. calorie availability but in most instances they are not statistically significant In general. transfers performance and their difference seem a function of the organic and fluid interactions. among factors like the profile and initial conditions of beneficiaries the capacity of local. markets and program objectives and design Costs associated with cash transfers and vouchers. tend to be substantially lower relative to food Yet methods for cost effectiveness analysis vary. and need to be more standardized and nuanced The reviewed evaluations are helping to shift the. debate from one shaped by ideology political economy and inference of evidence to one. centering on robust and context specific results, Keywords social protection safety nets food security political economy cash transfers in. kind transfers food aid vouchers impact evaluations cost effectiveness. JEL codes D610 H530 O120 O130 Q180,Table of Contents. Executive summary 5,1 Introduction 7,2 Anatomy of the debate 8.
2 1 Political economy 9,2 2 Theory 12,2 3 Evidence and practice 14. 3 Impact evaluations 18,3 1 Descriptive features 18. 3 2 Impacts 23,3 3 Costs 34,4 Discussion 38,5 Conclusions 40. References 41,Annex 1 49,List of Figures Tables and Boxes. Figure 1 Microeconomic effects of cash and in kind transfers 13. Figure 2 Mean seasonal price change in the Malawi maize market 1989 2009 16. Figure 3 Preferences for food and performance of the TPDS 17. Figure 4 Relationship between impact of transfers effect size and initial conditions calories 25. Figure 5 Difference in impact between food and cash transfers on food consumption 26. Figure 6 Difference in impact between food and cash transfers on per capita calorie in take 27. Figure 7 Difference in impact between food and cash transfers on Food Consumption Scores 29. Figure 8 Difference in impact between food and cash transfers on the Dietary Diversity Index 30. Figure 9 Difference in impact between vouchers and cash transfers on Household Dietary. Diversity Scores 31, Figure 10 Difference in impact between food and cash transfers on poverty 32.
Figure 11 Summary of differences in impacts by transfer modality and indicator 33. Figure 12 Summary of differences in impacts by indicator ranges and averages 34. Figure 13 Difference in total costs USD between transfer modalities with and without. procurement 37, Table 1 Descriptive statistics of impact evaluations 22. Table 2 Indicators included in the evaluations 23, Table 3 Relative impacts of food and cash transfers on dietary diversity indicators 29. Table 4 Costs per transfer and transfer ratios 34, Table 5 Beneficiary transaction costs for obtaining transfers time and monetary 36. Table 6 Cost of increasing a given indicator by 15 percent in Ecuador 36. Box 1 Local economic multipliers 15,Box 2 Use of cash by beneficiaries 24. Box 3 Indicators for dietary diversity 28,Executive summary.
Currently one of the hottest social protection debates is whether India should replace its public. food distribution system with cash transfers The issue has been widely covered in the literature. and media with arguments made for and against the transition Similar discussions on cash. versus food are unfolding in countries in the process of reforming their subsidy regimes some. of which in the Middle East the issue equally arises in contexts of responding to chronic food. insecurity such as in Ethiopia and Niger or to sudden disasters such as in Bangladesh and the. Philippines All these examples beg the question of when is it best to provide food instead of. cash a longstanding quandary part of a larger in kind versus cash controversy While evidence. is mounting on the effectiveness of cash in general what do we know about its performance. relative to food in particular, Until recently a key limiting factor in informing the debate in developing countries has been the. paucity of robust comparative evidence As a result the discussion on transfer selection has been. largely based on inference that is based on findings from individual programs implemented in. diverse contexts relying on different evaluation methods or designed for differing purposes. Such extrapolation and comparison of findings could at best be suggestive of relative. effectiveness Drawing from a new generation of evaluations deliberately comparing alternative. transfers this paper takes stock of key issues and evidence on the cash versus food debate. Conceptually the most fundamental dilemma is the trade off between providing choice and. promoting a given externality In kind transfers are often considered paternalistic since they. constrain recipients from maximizing their utility through choice that is the mainstream. argument in favor of cash is that it provides choice and empowers This is a strong rationale. although it also stimulates some reflections for example can choice be exercised where there is. no or limited availability of food Or is choice just the ability to freely dispose of a given. transfer e g cash or should such definition also include the opportunity to choose what to get. in the first place e g cash or food It is not unlikely and it is indeed desirable that these. quandaries will keep fomenting debates in the years to come Also the political economy of. transfer provision would most probably continue to play an important role in shaping what is. provided to recipients Yet those issues should not substitute for or distract from designing and. advocating for assistance based on contextual evidence and performance on the ground. So what do we know about the impacts of alternative transfer modalities The traditional source. of comparative evidence draws from studies on the ex food stamp program now SNAP in the. United States Contrary to predictions of standard theory these overwhelmingly show that. inframarginal in kind transfers are more effective than an equivalent cash transfer in increasing. food consumption A comprehensive review showed that virtually every study finds food. stamps increase household nutrient availability at 2 to 10 times the rate of a like value of cash. income Why such difference While a cash out puzzle is an empirical regularity the debate is. inconclusive on the reasons behind it, But what s the state of the evidence in developing countries The paper reviewed 12 comparative. studies in 10 countries including responses to droughts Niger man made crises Democratic. Republic of Congo and Ecuador and natural disasters Sri Lanka others were implemented as. part of social protection systems such as Bangladesh Ethiopia Mexico and Cambodia while. others envisaged developmental interventions in fragile contexts such as Yemen and Uganda. While conditions and design differed between country studies programs within countries put. cash and food and vouchers when considered on an equal methodological footing. By examining the performance of transfers on a dozen indicators most of which food security. related we paper finds that differences in effectiveness vary by indicator although they tend to. be moderate on average There are cases were differences are more marked e g cash being. more effective in enhancing food consumption while food seems to outperform cash in. increasing household caloric intake although in most cases they are not statistically significant. In general transfers performance and their difference seem a function of the organic and fluid. interactions among a number of factors e g profile and initial conditions of beneficiaries. capacity of local markets and program objectives and design instead of inherent merits of one. modality over the other, The reviewed studies show that cash transfers tend to be at least twice more efficient than food. based interventions Yet methods for cost analyses vary in scope breadth and depth For. example only in two cases it was possible to examine a fuller measure of program efficiency. that account for food procurement costs Such approach led to widely different results that those. based on sole implementation costs In some cases efficiency gains may have been achieved by. shifting costs to beneficiaries in the form of higher travel costs and waiting time to obtain. transfers It is also likely that both costs and effects are fairly dynamic e g set up and variable. costs and may follow seasonal patterns for example While the challenges in undertaking. robust cost analyses should not be underplayed it is important that future cost effectiveness. studies are more standardized and nuanced, Finally a dozen evaluations are just a new beginning not the end of the debate while. promising they are dwarfed by for example the level of empirical attention devoted to. programs like SNAP or conditional cash transfers While the review has shown the growing. knowledge on transfer debate it also exposed a number of information gaps For example the. implementation of voucher programs or combined program modalities seem underexplored also. evidence largely based on food consumption calories and dietary diversity data may tell us little. for example about chronic malnutrition Yet the reviewed studies are already succeeding in. triggering a more fundamental change namely to shifting the terms of the debate from one. largely shaped by ideology political economy and inference of evidence to one centering on. comparable robust and context specific results,1 Introduction.
The current hype for cash transfers is hard to underplay Ozler 2013a Publications titled Show. Them the Money Let Them Eat Cash and Just Give Money to the Poor have made a strong case. for supporting vulnerable people with cash Blattman and Niehaus 2014 Blattman 2014 Hanlon. et al 2011 Evidence and advocacy papers have mushroomed dedicated learning and training. platforms have been established and operational guidelines were developed for both. development and humanitarian contexts CaLP 2013 Cash transfers are subject to extensive. media coverage while the blogosphere regularly host vibrant discussions on cash in connection. for example to the distribution of wealth from natural resources subsidy reforms enhancing. state accountability or exploring variants in program design The Economist 2014 Devarajan. 2013 Ozler 2013b Moss 2013 Pritchett 2012, To be sure cash transfers are among the most rigorously evaluated fields in social sciences. including a proven track record of performance in attaining intended objectives and broader. multipliers Andrews et al 2014 Davis et al 2012 IEG 2011 The basic question that this paper. addresses is not whether cash transfers work in general but whether and when they do so. relative to in kind food assistance Indeed the cash versus in kind debate is among the most. longstanding controversial and polarizing social protection quandaries Take the following. T he big reason poor people are poor is because they don t have enough money and it. shouldn t come as a huge surprise that giving them money is a great way to reduce that problem. considerably more cost effectively than paternalism i e vouchers and in kind transfers So. let s abandon the huge welfare bureaucracy and just give money to those we should help out. Kenny 2013, T housands of economics professors across the globe persuade millions of undergraduates. that granting the poor distribution of benefits in kind is less efficient than simply transferring. to them cash The economist s traditional normative dictum on benefits in kind may be. analytically elegant but practically dead wrong Reinhardt 2013. These seem to posit two irreconcilable perspectives But is there some truth in both What does. the cross country evidence and experience tell us about transfers relative performance Until. recently a key limiting factor in informing the debate in developing countries has been the. paucity of robust comparative evidence 2 As a result the discussion on transfer selection has. been largely based on inference that is based on findings from individual programs. implemented in diverse contexts relying on different evaluation methods or designed for. A notable exception is the United States Supplemental Nutrition Assistance Program SNAP or ex Food Stamp. Program As mentioned in the next section SNAP has been subject to ample empirical scrutiny in comparison to. cash transfers, differing purposes Such extrapolation and comparison of findings could at best be suggestive. of relative effectiveness, This paper reviews key findings emerging from a new generation of robust impact evaluations in. ten developing countries namely Bangladesh Cambodia the Democratic Republic of Congo. Ecuador Ethiopia Mexico Niger Sri Lanka Uganda and Yemen Those studies deliberately. compare cash and food transfers under the same circumstances through randomized controlled. trials RCTs quasi experimental methods or regression analysis The paper frames and. discusses emerging results within the broader issues that shape transfer selection debates such as. conceptual and political economy matters It argues that the debate involves a range of factors. that makes it more complex than often assumed it shows that in terms of performance average. relative effectiveness cannot be generalized and that methods for cost effectiveness analysis. should be strengthened Overall it argues that the debate is increasingly moving from one largely. driven by ideology and political economy to one centering on contextual and robust evidence As. such while longstanding the debate is somewhat entering onto a new beginning. The analysis is conducted within certain parameters First the note examines the transfer debate. within the universe of safety net programs 3 including interventions such as public works. conditional or unconditional transfers Under those programs the size of cash is generally. devised for consumption smoothing objectives including enabling access to food and other. essential needs 4 Therefore the vast literature on cash grants which involve relatively large. sums of money to jump start entrepreneurship and investment go beyond the scope of this. paper Similarly in kind transfers may encompass a vast gamut of items such as shelter. agricultural inputs and subsidized health care Yet we only consider part of those transfers. namely food commodities as such we focus on a subset of the wider cash versus in kind. debate Also in discussing policy issues we consider food transfers as a single entity while de. facto they are composed by multiple commodities of different monetary and nutritional value. The reminder of the paper is organized as follows after this introduction the next section sets. out a framework examining key issues that shape transfer selection debates including the role of. political economy theory and evidence Section 3 describes the compilation of evaluations and. sets out their results in terms of impacts and costs Section 4 discusses the implications from the. analysis while summary conclusions are offered in section 5. 2 Anatomy of the debate, The cash versus food dilemma is relevant under a range of poverty reduction debates but it is.
particularly compelling for food security issues In this respect the role of social protection in. food security is being increasingly examined including through the lens of its three core pillars. how social protection can enhance food production and agricultural productivity Tirivayi et al. 2013 how transfers can provide access to food CFS 2012 and how social protection can as. Safety nets refer to non contributory predictable transfers in cash or in kind and are a component of larger social. protection systems World Bank 2014, According to cross country survey data the average size of safety net transfers is about 23 percent of the poor s. income or consumption World Bank 2014, Alderman 2014 put it be more nutrition sensitive A forth food security pillar risk or stability. underpins those three dimensions and it is central to the connections between social protection. and resilience Davies et al 2013 The interactions between social protection transfers and those. food security components are mediated by a range of other factors e g food security being only. one factor in the nutrition equation and occur under different timeframes e g the likely. timeframe for reducing malnutrition is measured more in terms of a generation rather than of a. Three forms of transfers are considered in the paper namely cash food and vouchers Cash. transfers provide people with money while food transfers or food aid include the distribution. of commodities Food transfers can be procured internationally imported food or local sourced. in the same country where the program is implemented Vouchers are also known as stamps or. near cash transfers and can be used in predetermined locations including selected shops. supermarkets retail stores and fairs Vouchers take two forms on one hand value based. vouchers provide access to commodities for a given monetary amount on the other hand. vouchers can be commodity based or tied to a pre defined quantity of given foods Therefore. vouchers are a hybrid form of transfer that display features of both cash value based vouchers. allow for some level of choice although limited to the commodities available in the chosen. location and in kind food the implementation of commodity based vouchers can closely. resemble that of public food distributions systems 5. In a way cash transfers provide beneficiaries consumers with choice while at the same time. stimulating local markets we ll come back to the issue of choice in section 2 1 Also vouchers. can equally bolster local food markets although the choice they provide is more restricted or. none 6 Food transfers can stimulate markets if procured locally although at a different level than. vouchers Indeed the former tend to entail the engagement of a more limited number of. upstream larger producers while the latter would directly involve a larger number of. downstream smaller actors 7 From this perspective vouchers are more local in nature. Against this backdrop in order to understand the origins of the debate and advance it. constructively we need to unpack a set of interconnected domains These include three broad. issues namely political economy theory and evidence which are hereafter discussed. 2 1 Political economy, The transfer debate is not new Historians found accounts of the quandary in 17th Century. England and even in ancient Edessa around 124 BC Lindert 2005 Garnsey 1988 More. recently from the late 1990s and mid 2000s the emergence of cash transfers on the global stage. was in part defined by mounting criticism over the international food aid system particularly in. In most cases commodities are provided by private or commercial partners Yet retailers could also be public or a. mix of public private actors such as in the case of fixed price outlets in Syria Omamo et al 2010. In practice also commodity based vouchers can provide some room for choice There are instances where. beneficiaries can choose between commodities so long as their weight does not exceed the limit established by the. program Levan Tchatchua personal communication, Initiatives such as WFP s Purchase for Progress program deliberately procure food from small farmers hence. spurring local economic gains among well identifiable actors similar to vouchers. terms of transoceanic shipments and local monetization of commodities Barrett and Maxwell. 2006 2005 Clay 2006 OECD 2005, While the global food aid model has evolved dramatically toward more targeted technology.
supported locally procured and nutritionally sensitive commodities some lingering perceptions. around food transfers seem hard to fully dispel 8 In part the mixed performance of large scale. national public food distribution systems may have contributed to a view of food transfers as. intrinsically leak prone and inefficient GoI 2005 Conversely since the mid 2000s the growing. application of technology to the delivery has further propelled interest in cash as a smart and. efficient way of providing assistance Vincent and Cull 2011 For example in an experiment. comparing alternative cash delivery options in Niger Aker et al 2013 found that households. receiving cash electronically had higher diet diversity potentially due among others to time. saved to collect the transfer 9 Technology however is now also underpinning food based. programs hence help alleviating a number of traditional concerns around their management For. example Muralidharan et al 2014 showed that based on an experiment in the state of Andhra. Pradesh in India biometric smartcards enhanced the performance of the food based Targeted. Public Distribution System TPDS, Yet in some contexts food transfers may still evoke the image of truck convoys pouring onto. famine stricken areas e g in the Horn of Africa or of food distributions driven by commercial. and geopolitical interests More subtly in kind food may be more directly associated with the. inability of countries or households of feeding themselves hence making the issue of dignity an. important factor accompanying in kind food provisions instead cash transfers tend to conjure. just the opposite i e freedom and independence even if supposed to play the exact same role. as food transfers e g providing access to food though public transfers. The latter observation raises perhaps the most fundamental philosophical dilemma in the debate. namely the trade off between providing choice and promoting a desired externality Pritchett. 2012 2005 Lopez Rodriguez 2011 Currie and Gahvari 2008 Basically the arguments in. favor of in kind transfers revolve around an over provision of goods This involves. informational principal agent or behavioral arguments that often provide the foundations for. much of the debate around conditionalities Fiszbein and Schady 2009 In broad terms this. suggest that the expected externalities of an in kind transfer would be desirable when there is a. private under investment say in food consumption or nutrition below an optimal social or. even private level Hence by representing a vehicle to influence behaviors in kind transfers are. considered paternalistic since they constrain recipients from maximizing their utility through. choice that is the magic of cash lies in its fungibility Glaeser 2012. For instance since 2000 locally procured food in developing countries soared by 45 percent while untargeted. bilateral food aid i e food aid sold on local markets now represents only about 3 percent of total flows The entire. volume of international food aid itself amounts to less than 0 25 percent of total global food production Barrett et. al 2012 Gradually innovations such as the use of smart cards mobile phones biometric devices and e monitoring. tools were also adopted in food and voucher programs Omamo et al 2010. Households in villages receiving cash electronically had a household diet diversity value that was 31 points 10. percent higher as compared with the manually receiving villages with a statistically significant difference at the 5. percent level, Relatedly cash is often seen not only as a mechanism to transfer income but to transfer power. As it was recently put cash transfers have the potential to shift not just poverty reducing. policies but also the balance of power between government and its citizens in favor of the latter. Devarajan 2013 In other words the mainstream argument in favor of cash is straightforward. cash provides choice and empowers hence it is redefinitional 10. Such distinct properties make a strong case for cash transfers However they also stimulate some. reflections can the provision of choice be considered an objective per se In that case any cash. transfer can be considered effective and would not require evaluations of outcomes or impacts. Or can choice be exercised effectively when there are limited supplies of goods or they are. unaffordable This is intimately linked to technical issues around market functionality which. will be discussed in the section 2 3 Finally is choice just the ability to freely dispose of a given. transfer e g cash or should such definition also include the opportunity to choose what to get. in the first place e g cash or food 11 In India an interesting pilot is testing such broader notion. of choice by providing people the chance to select cash or food Such choice would not be. hypothetical but real and expressed on the spot at TPDS distribution points Muralidharan. 2011 In other words paternalism seems less about interventions per se and more about. processes to provide them i e whether an intervention is paternalistic hinges on the extent to. which it considers beneficiaries as key stakeholders throughout the life of the program. Similarly from the supply side of assistance political economy regimes may have influenced. what is provided to recipients This may be particularly the case for food based programs. including at the international level e g Bageant et al 2010 for the United States and domestic. arenas alike e g Dreze 2011 for India There are signs however of changing approaches as. epitomized by legislative and policy provisions devoting larger budget shares for cash based. programs Elliot and McKitterick 2014 WFP 2011 Providing a menu of transfers e g cash. food to be used based on local conditions is likely to be conducive to contextual and demand. led approaches in this vein simply turning provisions from one modality to another e g from. only food to only cash may constrain recipients since they can t choose what to get rather. than empowering them We ll come back to the issue of choices in section 2 3. In general the inherent tension between fungibility and encouraging a desired outcome will keep. being a matter of discussion for many years This is not only highly likely but also highly. desirable Similarly the political economy of transfer provision may continue to play an. important role in determining what is provided to recipients There are important factors behind. conceptual and political economy debates many of which go well beyond the choice of transfers. They nevertheless affect it significantly including through the contextual definition of what poor. people deserve public perceptions and opinions history the influence of particular. Paul Niehaus keynote address at the event Cash Transfers The New Benchmark for Foreign Aid hosted by the. Center for Global Development 9 May 2014 Washington DC Videos and materials of the event are available at. http www cgdev org event cash transfers new benchmark foreign aid. For example in 2006 a combined cash and food transfer program was implemented in rural Malawi The follow. up evaluation explored participants preferences over one or both transfers and found that most beneficiaries. were very satisfied with receiving both food and cash Devereux 2008 Yet the redesign of the project in 2007. only envisaged cash transfers, constituencies and to some extent even the symbolic value carried by food in societies 12. However these issues should not substitute for or distract from understanding what works. based on technical appropriateness and evidence on performance So what do we know about the. effectiveness of alternative transfer modalities These will be reviewed in the next two sections. 2 2 Theory, The microeconomic foundations of modern debates tend to draw from standard economic theory. often rooted in the elegant exposition provided by Southworth 1945 The transfer debate. received considerable empirical attention in the 1980s and mid 1990s with a vast share of it. examining the United States Supplemental Nutrition Assistance Program or SNAP 13 Basu. 1996 Faminow 1995 Fraker et al 1995 Devaney and Moffitt 1991 Levedahl 1991 Fraker. 1990 Coate 1989 Blackorby and Donaldson 1988 14, In a stylized form the literature shows that at least two factors are key to predicting transfers.
relative effectiveness namely the size of the transfer relative to household consumption and. beneficiaries marginal propensity to consume food out of that transfer An in kind transfer is. defined as extramarginal when it is provided for an amount greater larger than what households. would have normally consumed in the absence of the transfer conversely an in kind transfer is. inframarginal if it is smaller than the amount consumed by recipients According to conventional. models an inframarginal in kind transfer and a cash transfer of equal value would have the same. effect in bolstering household food consumption i e beneficiaries marginal propensity to. consume food out of an additional income out of an in kind or cash transfer should be the same. Put it differently there is only an income effect and no price effect associated with. inframarginal transfers However if in kind transfers are extramarginal and three underlying. conditions are met 15 then food consumption out of in kind transfers would be larger than for an. equal cash transfer due to the price effect A more formal illustration is provided in figure 1. Consider a simple model with food horizontal axis and cash vertical axis A cash transfer. shifts the budget constraint from AB up to CE while an equal in kind transfer e g maize for a. size of QM leads to a kinked budget ADE Then suppose there are two households I and II. Household I is indifferent between transfer type moving from indifference curve I to I under. either transfer Household II instead is weakly worse off under the in kind transfer consuming. at point II the kink if resale is prohibited or at II if resale is costly. On the history and role of food in societies see Tannahill 1988 For a discussion on the relationship between. food security and social stability see Barrett 2013. The SNAP program is the world s largest food voucher scheme According to USDA data about 1 every 7. Americans or 47 4 million individuals benefited from the SNAP voucher program in 2013 2014 See. http www fns usda gov pd 34SNAPmonthly htm, During the same period the debate was also examined in the context of famines relief as laid out in the influential. analysis by Dreze and Sen 1989 p 97 See also Josling 2011 and the classic volume edited by Pinstrup Andersen. 1988 for examples of historical food voucher programs in Sri Lanka Pakistan and Jamaica. In particular the ration could not be resold on markets could not be resold below market prices or could be done. so only at high transaction costs, Figure 1 Microeconomic effects of cash and in kind transfers. Source adapted from Ahmed et al 2010, Note that the household would have chosen II under a cash transfer program If resale is not. possible the in kind transfer of QM is extramarginal for household II as it consumes more maize. than it would have under a cash transfer Conversely the in kind transfer is inframarginal for. household I and its effects are equivalent to cash. Interestingly an empirical regularity in the SNAP literature is the rejection of the standard. model s predictions Indeed it is widely demonstrated that in kind transfers tend to increase food. consumption more than cash transfers even when in kind transfer are inframarginal In other. words such cash out puzzle entails that the marginal propensity to consume food out of an in. kind transfer is higher than that out of cash 16 As summarized in a comprehensive review. virtually every study finds food stamps increase household nutrient availability at 2 to 10 times. the rate of a like value of cash income Barrett 2002. Various explanations have been proposed for difference with no conclusive answers Possible. reasons include a labeling effect of in kind transfers that induce a sense of moral obligation. among recipients to use in kind transfers for their intended food consumption purpose Senauer. and Young 1986 different preferences by gender and decision making behaviors in multi adult. households Breunig and Dasgupta 2005 alterations in household budgeting and planning of. monthly purchases Wilde and Ranney 1996 or possible marginal stigma associated with in. kind transfers Levedahl 1995 In other words the existence of a cash out puzzle is a generally. accepted empirical fact although our understanding of the reasons behind such puzzle remains. incomplete, Importantly however what is referred to as in kind in the literature is actually a voucher not a. food transfer per se and as underscored the evidence discussed above largely draws from. Similarly one estimate from Bangladesh showed that among participants in a number of safety net programs the. marginal propensity of our wheat was 0 33 while for an equivalent cash transfer it was near zero Del Ninno and. Dorosh 2003, programs in high income contexts So what s the state of the debate and evidence in developing.
countries This is a subject for the next section,2 3 Evidence and practice. The available transfer literature in developing countries can be grouped in five broad empirical. buckets First there is high quality research conducted on individual cash based programs This. group mostly includes careful empirical tests of conditional and unconditional cash transfers. implemented in various contexts Evans et al 2014 Baird et al 2013 de Brauw et al 2012. Barham and Maluccio 2008 Duflo 2003 Second there are comprehensive reviews focusing on. cash transfers often in relation to sectors themes and regions These take the form of general. literature reviews or cross country analyses geared to shed light on the relationship between cash. transfers and issues such as disaster response child malnutrition or HIV AIDS Alderman 2014. Adato and Basset 2012 Bailey and Harvey 2011 DFID 2011 Garcia and Moore 2011 Fiszbein. and Schady 2009, Those two threads of literature are mirrored on the food front in kind food transfers have been. carefully evaluated through the use of experiments and quantitative methods including. examining different food based interventions such as school feeding general food distribution. or food for work Kazianga et al 2014 Singh and Dercon 2012 Hoddinott et al 2012 Adelman. et al 2008a b Gilligan and Hoddinott 2007 Yamano et al 2005 Del Ninno and Dorosh 2003. Quisumbing 2003 At the same time food transfers have been subject of generic reviews and. more focused meta analyses in relation to particular regions or interventions Alderman and. Bundy 2012 Webb et al 2011 Del Ninno et al 2007 Rogers and Coates 2002 Finally. publications have documented and summarized evidence emerging from all those four sets of. studies Lentz al 2013 Gentilini 2007, While recalling the general caveats on comparability those studies have generally concluded that. transfer appropriateness is context specific and hinges on multiple factors These include. program objectives the functioning of markets administrative capacity seasonality security. intra household preferences and community dynamics These factors which largely shape the. performance of transfers across time and space will be here briefly examined. Turning needs into effective demand is a key rationale for cash transfers Yet this might be. challenging in presence of weakly integrated or poorly competitive markets In those contexts. price transmissions would not necessarily signal relative scarcities and localized cash injections. may result in price spikes leaving consumers or net buyers worse off 17 In other words there are. circumstances where local markets may perform poorly food prices may be excessively high or. volatile and private traders may not have incentives to supply commodities In those contexts a. cash transfer may neither lead to more choice nor purchasing power and in kind food may be a. more appropriate response i e it ensures both availability of and access to food From this. See Devereux 1988 for a clear exposition For an interesting view on how recent high food prices may have.

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