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Effects of treatment beyond the treated: a general equilibrium impact evaluation of Lesotho's cash grants program

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  • Mateusz J. Filipski
  • J. Edward Taylor
  • Karen E. Thome
  • Benjamin Davis

Abstract

Africa's social cash transfer programs target the most resource-constrained households, unlikely to expand supply in response to transfer-induced demand. We propose a local economy-wide impact evaluation model and use it to evaluate local spillovers from Lesotho's Child Grants Program. We report Monte-Carlo confidence bounds around impact-simulation results. We find significant spillovers to nonrecipient households and significant real income multipliers, although the latter are dampened if factor supply constraints generate excessive inflationary pressures. Our findings raise questions about how to measure the impacts of cash transfers. Evaluations focusing only on eligible households are likely to significantly understate program impacts.

Suggested Citation

  • Mateusz J. Filipski & J. Edward Taylor & Karen E. Thome & Benjamin Davis, 2015. "Effects of treatment beyond the treated: a general equilibrium impact evaluation of Lesotho's cash grants program," Agricultural Economics, International Association of Agricultural Economists, vol. 46(2), pages 227-243, March.
    • Handle: RePEc:bla:agecon:v:46:y:2015:i:2:p:227-243
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    File URL: http://hdl.handle.net/10.1111/agec.12153
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    References listed on IDEAS

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    3. Adams, Katherine P. & Lybbert, Travis J. & Vosti, Stephen A. & Ayifah, Emmanuel & Arimond, Mary & Adu-Afarwuah, Seth & Dewey, Kathryn G., 2018. "Unintended effects of a targeted maternal and child nutrition intervention on household expenditures, labor income, and the nutritional status of non-targeted siblings in Ghana," World Development, Elsevier, vol. 107(C), pages 138-150.
    4. Filipski, M. & Belton, B., 2018. "Give Someone a Fishpond Modeling the Impacts of Aquaculture in the Rural Economy," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277461, International Association of Agricultural Economists.
    5. Filipski, Mateusz & Belton, Ben, 2018. "Give a Man a Fishpond: Modeling the Impacts of Aquaculture in the Rural Economy," World Development, Elsevier, vol. 110(C), pages 205-223.
    6. Gupta, Anubhab & Taylor, J. Edward & Davis, Benjamin & Luca, Pellerano & Ousmane, Niang, 2016. "Long-term Impacts of Poverty Programs: A Local-economy Cost-benefit Analysis of Lesotho's Child Grants Programme," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235474, Agricultural and Applied Economics Association.
    7. Kuss, Maria Klara & Gassmann, Franziska & Mugumya, Firminus, 2018. "The relevance of local structures for economic multiplier effects of social pensions in Uganda," MERIT Working Papers 2018-004, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. von Fintel, Dieter & Pienaar, Louw, 2016. "Small-Scale Farming and Food Security: The Enabling Role of Cash Transfers in South Africa's Former Homelands," IZA Discussion Papers 10377, Institute of Labor Economics (IZA).
    9. Gilliland, Ted E. & Sanchirico, James N. & Taylor, J. Edward, 2018. "Environmental Impacts of Cash Transfer Programs: Implications for the Welfare of Poor Communities in Developing Countries," 2018 Annual Meeting, August 5-7, Washington, D.C. 274244, Agricultural and Applied Economics Association.

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