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Stuck exchange: Can cash transfers push smallholders out of autarky?

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  • Ervin Prifti
  • Silvio Daidone
  • Noemi Pace
  • Benjamin Davis

Abstract

This paper focuses on the role of unconditional cash transfers in helping smallholders’ commercialization by overcoming barriers to trade from transaction costs. We use data from a controlled experiment for the evaluation of the Child Grant model in Zambia. We employ a Heckman model that allows us to capture the effects of the program on the propensity to engage in trade in both inputs and outputs markets as well as on the value of trade. The cash transfer program contributes significantly to increase farmers’ commercialization. The program produced greater benefits for those households that face more binding transaction costs from transportation and information gathering.

Suggested Citation

  • Ervin Prifti & Silvio Daidone & Noemi Pace & Benjamin Davis, 2020. "Stuck exchange: Can cash transfers push smallholders out of autarky?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 29(5), pages 495-509, July.
    • Handle: RePEc:taf:jitecd:v:29:y:2020:i:5:p:495-509
    DOI: 10.1080/09638199.2019.1702711
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    Cited by:

    1. Silvio Daidone & Francisco Pereira Fontes, 2023. "The role of social protection in mitigating the effects of rainfall shocks. Evidence from Ethiopia," Journal of Productivity Analysis, Springer, vol. 60(3), pages 315-332, December.
    2. Pace, Noemi & Sebastian, Ashwini & Daidone, Silvio & Dela O Campos, Ana Paula & Prifti, Ervin & Davis, Benjamin, 2022. "Cash transfers’ role in improving livelihood diversification strategies and well-being: short- and medium-term evidence from Zimbabwe," World Development, Elsevier, vol. 154(C).

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