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The poverty impacts of cash and in-kind transfers: experimental evidence from rural Mexico

Author

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  • Emmanuel Skoufias
  • Mishel Unar
  • Teresa Gonzalez de Cossio

Abstract

The unique experimental design of the Food Support Programme ( Programa de Apoyo Alimentario ) is used to analyse in-kind and cash transfers in the poor rural areas of southern states of Mexico. The intent-to-treat effect on poverty of cash transfers of real value 25 per cent less than the market value of in-kind transfers is identical to that of in-kind transfers. Potential explanations of this result are investigated by looking into the differences in impacts of in-kind and cash transfers on food consumption and non-food expenditures and on the allocation of family labour between agricultural and non-agricultural activities. Both in-kind and cash transfers have identically large positive impacts on food consumption. Non-food expenditures are also higher in the localities with cash transfers, whereas they remain unaffected in the localities with in-kind transfers. Both kinds of transfers have a significant impact on the time allocation of males (and not females) who switch from agricultural to non-agricultural activities. But, the availability of cash transfers has a significantly higher marginal effect than in-kind transfers on the shift towards non-agricultural activities. Overall, the findings suggest that cash transfers may be better able than in-kind transfers at mitigating the impact of market imperfections, thus increasing both equity and efficiency.

Suggested Citation

  • Emmanuel Skoufias & Mishel Unar & Teresa Gonzalez de Cossio, 2013. "The poverty impacts of cash and in-kind transfers: experimental evidence from rural Mexico," Journal of Development Effectiveness, Taylor & Francis Journals, vol. 5(4), pages 401-429, December.
    • Handle: RePEc:taf:jdevef:v:5:y:2013:i:4:p:401-429
    DOI: 10.1080/19439342.2013.843578
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    Cited by:

    1. Lara Cockx & Nathalie Francken, 2016. "Evolution and Impact of EU Aid for Food and Nutrition Security: A Review," FOODSECURE Working papers 47, LEI Wageningen UR.
    2. Miguel Niño‐Zarazúa, 2019. "Welfare and Redistributive Effects of Social Assistance in the Global South," Population and Development Review, The Population Council, Inc., vol. 45(S1), pages 3-22, December.
    3. John Hoddinott & Susanna Sandström & Joanna Upton, 2018. "The Impact of Cash and Food Transfers: Evidence from a Randomized Intervention in Niger," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 100(4), pages 1032-1049.
    4. Armando Barrientos & Daniele Malerba, 2020. "Social assistance and inclusive growth," International Social Security Review, John Wiley & Sons, vol. 73(3), pages 33-53, July.
    5. Erica Field & Rohini Pande & Natalia Rigol & Simone Schaner & Charity Troyer Moore, 2021. "On Her Own Account: How Strengthening Women's Financial Control Impacts Labor Supply and Gender Norms," American Economic Review, American Economic Association, vol. 111(7), pages 2342-2375, July.
    6. repec:fpr:export:1341 is not listed on IDEAS
    7. Julius Ohrnberger, 2022. "Economic shocks, health, and social protection: The effect of COVID‐19 income shocks on health and mitigation through cash transfers in South Africa," Health Economics, John Wiley & Sons, Ltd., vol. 31(11), pages 2481-2498, November.
    8. Abhijit V. Banerjee & Rema Hanna & Gabriel E. Kreindler & Benjamin A. Olken, 2017. "Debunking the Stereotype of the Lazy Welfare Recipient: Evidence from Cash Transfer Programs," The World Bank Research Observer, World Bank, vol. 32(2), pages 155-184.
    9. Tirivayi, Nyasha & Groot, Wim, 2018. "Does integrating AIDS treatment with food assistance affect labor supply? Evidence from Zambia," Economics & Human Biology, Elsevier, vol. 28(C), pages 79-91.
    10. Tobias Pfutze & Carlos Rodríguez-Castelán, 2019. "Can a Small Social Pension Promote Labor Force Participation? Evidence from the Colombia Mayor Program," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2019), pages 111-154, October.
    11. Ma, Zhao & Bauchet, Jonathan & Steele, Diana & Godoy, Ricardo & Radel, Claudia & Zanotti, Laura, 2017. "Comparison of Direct Transfers for Human Capital Development and Environmental Conservation," World Development, Elsevier, vol. 99(C), pages 498-517.
    12. Saeed, Muhammad Kashif & Hayat, Muhammad Azmat, 2020. "The Impact of Social Cash Transfers on Poverty in Pakistan-A Case Study of Benazir Income Support Programme," MPRA Paper 99805, University Library of Munich, Germany.
    13. Lorenz, Aaron & Lee, Yu Na, 2023. "On Rice and Weddings: Impacts of Food Assistance on Child Marriage in Indonesia," 2023 Annual Meeting, July 23-25, Washington D.C. 335954, Agricultural and Applied Economics Association.
    14. Erica M. Field & Rohini Pande & Natalia Rigol & Simone G. Schaner & Charity Troyer Moore, 2019. "On Her Own Account: How Strengthening Women's Financial Control Affects Labor Supply and Gender Norms," NBER Working Papers 26294, National Bureau of Economic Research, Inc.
    15. Gilbert Richard & Murphy Nora A. & Stepka Allison & Barrett Mark & Worku Dianne, 2018. "Would a Basic Income Guarantee Reduce the Motivation to Work? An Analysis of Labor Responses in 16 Trial Programs," Basic Income Studies, De Gruyter, vol. 13(2), pages 1-12, December.
    16. Aleksandrova, Mariya, 2019. "Social protection as a tool to address slow onset climate events: Emerging issues for research and policy," IDOS Discussion Papers 16/2019, German Institute of Development and Sustainability (IDOS).

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