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Can unconditional cash transfers raise long-term living standards? Evidence from Zambia

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  • Handa, Sudhanshu
  • Natali, Luisa
  • Seidenfeld, David
  • Tembo, Gelson
  • Davis, Benjamin

Abstract

In Africa, state-sponsored cash transfer programs now reach nearly 50 million people. Do these programs raise long-term living standards? We examine this question using experimental data from two unconditional cash transfer programs implemented by the Zambian Government. We find far-reaching effects of the programs both on food security and consumption as well as on a range of productive outcomes. After three years, household spending is on average 67 percent larger than the value of the transfer received, implying a sizeable multiplier effect, which works through increased non-farm activity and agricultural production.

Suggested Citation

  • Handa, Sudhanshu & Natali, Luisa & Seidenfeld, David & Tembo, Gelson & Davis, Benjamin, 2018. "Can unconditional cash transfers raise long-term living standards? Evidence from Zambia," Journal of Development Economics, Elsevier, vol. 133(C), pages 42-65.
    • Handle: RePEc:eee:deveco:v:133:y:2018:i:c:p:42-65
    DOI: 10.1016/j.jdeveco.2018.01.008
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