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Cash Transfers, Trust, and Inter-household Transfers: Experimental Evidence from Tanzania

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  • David K Evans
  • Katrina Kosec

Abstract

Institutionalized conditional cash transfer (CCT) programs may affect pre-existing, informal safety nets such as inter-household transfers and trust among community members. This study reports on a randomized controlled trial used to test the impact of CCTs on various measures of trust and informal safety nets within communities in Tanzania. It provides evidence that the introduction of a CCT program increased program beneficiaries’ trust in other community members and their perceived ability to access support from other households (e.g., childcare). Although CCTs reduced the total size of transfers to beneficiary households in the community in the short run (after 1.75 years of transfers), that reduction had disappeared 2.75 years after transfers began. Taken together, this evidence suggests that formal CCT programs do not necessarily crowd out informal safety nets in the longer term, and they may in fact boost trust and support across households.

Suggested Citation

  • David K Evans & Katrina Kosec, 2023. "Cash Transfers, Trust, and Inter-household Transfers: Experimental Evidence from Tanzania," The World Bank Economic Review, World Bank, vol. 37(2), pages 221-234.
    • Handle: RePEc:oup:wbecrv:v:37:y:2023:i:2:p:221-234.
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    File URL: http://hdl.handle.net/10.1093/wber/lhac030
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    1. de Milliano, Marlous & Barrington, Clare & Angeles, Gustavo & Gbedemah, Christiana, 2021. "Crowding-out or crowding-in? Effects of LEAP 1000 unconditional cash transfer program on household and community support among women in rural Ghana," World Development, Elsevier, vol. 143(C).
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    4. Nikolov, Plamen & Bonci, Matthew, 2020. "Do public program benefits crowd out private transfers in developing countries? A critical review of recent evidence," World Development, Elsevier, vol. 134(C).
    5. Pedro Albarran & Orazio P. Attanasio, 2003. "Limited Commitment and Crowding out of Private Transfers: Evidence from a Randomised Experiment," Economic Journal, Royal Economic Society, vol. 113(486), pages 77-85, March.
    6. Nikolov, Plamen & Bonci, Matthew, 2020. "Do Public Program Benefits Crowd Out Private Transfers in Developing Countries? An Overview of Evidence from Social Protection Policies," IZA Policy Papers 154, Institute of Labor Economics (IZA).
    7. Grimm, Michael & Hartwig, Renate & Reitmann, Ann-Kristin & Bocoum, Fadima Yaya, 2021. "Inter-household transfers: An empirical investigation of the income-transfer relationship with novel data from Burkina Faso," World Development, Elsevier, vol. 144(C).
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    More about this item

    Keywords

    conditional cash transfers; informal safety nets; service delivery; trust;
    All these keywords.

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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