Cash Transfers and Temptation Goods : A Review of Global Evidence

Cash transfers have been demonstrated to improve education and health outcomes and alleviate poverty in various contexts. However, policy makers and others often express concern that poor households will use transfers to buy alcohol, tobacco, or ot...

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Main Authors:	Evans, David K., Popova, Anna
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	AID AGENCIES BANK ACCOUNT BENEFICIARIES BENEFICIARY CAPITAL INVESTMENT CASH TRANSFER CASH TRANSFER PROGRAMS CASH TRANSFERS CHILD NUTRITION COUPONS DEVELOPING COUNTRIES DEVELOPMENT POLICY DISBURSEMENT DROUGHT ENGEL CURVES EXPENDITURE EXPENDITURES FEMALE-HEADED HOUSEHOLDS FOOD CONSUMPTION FOOD EXPENDITURES FOOD SECURITY FOOD TRANSFERS FUNGIBLE GDP GDP DEFLATOR HOUSEHOLD BARGAINING HOUSEHOLD DEMOGRAPHICS HOUSEHOLD HEAD HOUSEHOLD INCOME HOUSEHOLD PARTICIPATION HOUSEHOLD SURVEYS HUMAN CAPITAL HUMAN CAPITAL INVESTMENT HUMAN DEVELOPMENT IMPACT EVALUATION INCOME EFFECT INFLATION INSTRUMENT INTERNATIONAL BANK INTERVENTIONS INVESTING LIQUID CASH LOCAL CURRENCY MIDDLE INCOME COUNTRIES NORMAL GOOD PATERNALISM PENSION PENSION INCOME POLITICAL ECONOMY POOR POOR HOUSEHOLDS POOR PARENTS POOR PEOPLE PROGRAM IMPACTS PROPENSITY SCORE MATCHING PUBLIC FINANCE QUASIEXPERIMENTAL DESIGNS RETURN RETURNS RURAL RURAL AREAS SAFETY NETS SOCIAL POLICIES SOCIAL SAFETY NETS SUBSTITUTION EFFECT TRANCHE TRANSITION ECONOMY
Online Access:	http://documents.worldbank.org/curated/en/2014/05/19546774/cash-transfers-temptation-goods-review-global-evidence http://hdl.handle.net/10986/18802

id	okr-10986-18802
recordtype	oai_dc
spelling	okr-10986-188022021-04-23T14:03:49Z Cash Transfers and Temptation Goods : A Review of Global Evidence Evans, David K. Popova, Anna AID AGENCIES BANK ACCOUNT BENEFICIARIES BENEFICIARY CAPITAL INVESTMENT CASH TRANSFER CASH TRANSFER PROGRAMS CASH TRANSFERS CHILD NUTRITION COUPONS DEVELOPING COUNTRIES DEVELOPMENT POLICY DISBURSEMENT DROUGHT ENGEL CURVES EXPENDITURE EXPENDITURES FEMALE-HEADED HOUSEHOLDS FOOD CONSUMPTION FOOD EXPENDITURES FOOD SECURITY FOOD TRANSFERS FUNGIBLE GDP GDP DEFLATOR HOUSEHOLD BARGAINING HOUSEHOLD DEMOGRAPHICS HOUSEHOLD HEAD HOUSEHOLD INCOME HOUSEHOLD PARTICIPATION HOUSEHOLD SURVEYS HUMAN CAPITAL HUMAN CAPITAL INVESTMENT HUMAN DEVELOPMENT IMPACT EVALUATION INCOME EFFECT INFLATION INSTRUMENT INTERNATIONAL BANK INTERVENTIONS INVESTING LIQUID CASH LOCAL CURRENCY MIDDLE INCOME COUNTRIES NORMAL GOOD PATERNALISM PENSION PENSION INCOME POLITICAL ECONOMY POOR POOR HOUSEHOLDS POOR PARENTS POOR PEOPLE PROGRAM IMPACTS PROPENSITY SCORE MATCHING PUBLIC FINANCE QUASIEXPERIMENTAL DESIGNS RETURN RETURNS RURAL RURAL AREAS SAFETY NETS SOCIAL POLICIES SOCIAL SAFETY NETS SUBSTITUTION EFFECT TRANCHE TRANSITION ECONOMY Cash transfers have been demonstrated to improve education and health outcomes and alleviate poverty in various contexts. However, policy makers and others often express concern that poor households will use transfers to buy alcohol, tobacco, or other "temptation goods." The income effect of transfers will increase expenditures if alcohol and tobacco are normal goods, but this may be offset by other effects, including the substitution effect, the effect of social messaging about the appropriate use of transfers, and the effect of shifting dynamics in intra-household bargaining. The net effect is ambiguous. This paper reviews 19 studies with quantitative evidence on the impact of cash transfers on temptation goods, as well as 11 studies that surveyed the number of respondents who reported they used transfers for temptation goods. Almost without exception, studies find either no significant impact or a significant negative impact of transfers on temptation goods. In the only (two, non-experimental) studies with positive significant impacts, the magnitude is small. This result is supported by data from Latin America, Africa, and Asia. A growing number of studies from a range of contexts therefore indicate that concerns about the use of cash transfers for alcohol and tobacco consumption are unfounded. 2014-06-26T21:51:53Z 2014-06-26T21:51:53Z 2014-05 http://documents.worldbank.org/curated/en/2014/05/19546774/cash-transfers-temptation-goods-review-global-evidence http://hdl.handle.net/10986/18802 English en_US Policy Research Working Paper;No. 6886 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Africa East Asia and Pacific Latin America & Caribbean South Asia Africa Asia Latin America
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	AID AGENCIES BANK ACCOUNT BENEFICIARIES BENEFICIARY CAPITAL INVESTMENT CASH TRANSFER CASH TRANSFER PROGRAMS CASH TRANSFERS CHILD NUTRITION COUPONS DEVELOPING COUNTRIES DEVELOPMENT POLICY DISBURSEMENT DROUGHT ENGEL CURVES EXPENDITURE EXPENDITURES FEMALE-HEADED HOUSEHOLDS FOOD CONSUMPTION FOOD EXPENDITURES FOOD SECURITY FOOD TRANSFERS FUNGIBLE GDP GDP DEFLATOR HOUSEHOLD BARGAINING HOUSEHOLD DEMOGRAPHICS HOUSEHOLD HEAD HOUSEHOLD INCOME HOUSEHOLD PARTICIPATION HOUSEHOLD SURVEYS HUMAN CAPITAL HUMAN CAPITAL INVESTMENT HUMAN DEVELOPMENT IMPACT EVALUATION INCOME EFFECT INFLATION INSTRUMENT INTERNATIONAL BANK INTERVENTIONS INVESTING LIQUID CASH LOCAL CURRENCY MIDDLE INCOME COUNTRIES NORMAL GOOD PATERNALISM PENSION PENSION INCOME POLITICAL ECONOMY POOR POOR HOUSEHOLDS POOR PARENTS POOR PEOPLE PROGRAM IMPACTS PROPENSITY SCORE MATCHING PUBLIC FINANCE QUASIEXPERIMENTAL DESIGNS RETURN RETURNS RURAL RURAL AREAS SAFETY NETS SOCIAL POLICIES SOCIAL SAFETY NETS SUBSTITUTION EFFECT TRANCHE TRANSITION ECONOMY
spellingShingle	AID AGENCIES BANK ACCOUNT BENEFICIARIES BENEFICIARY CAPITAL INVESTMENT CASH TRANSFER CASH TRANSFER PROGRAMS CASH TRANSFERS CHILD NUTRITION COUPONS DEVELOPING COUNTRIES DEVELOPMENT POLICY DISBURSEMENT DROUGHT ENGEL CURVES EXPENDITURE EXPENDITURES FEMALE-HEADED HOUSEHOLDS FOOD CONSUMPTION FOOD EXPENDITURES FOOD SECURITY FOOD TRANSFERS FUNGIBLE GDP GDP DEFLATOR HOUSEHOLD BARGAINING HOUSEHOLD DEMOGRAPHICS HOUSEHOLD HEAD HOUSEHOLD INCOME HOUSEHOLD PARTICIPATION HOUSEHOLD SURVEYS HUMAN CAPITAL HUMAN CAPITAL INVESTMENT HUMAN DEVELOPMENT IMPACT EVALUATION INCOME EFFECT INFLATION INSTRUMENT INTERNATIONAL BANK INTERVENTIONS INVESTING LIQUID CASH LOCAL CURRENCY MIDDLE INCOME COUNTRIES NORMAL GOOD PATERNALISM PENSION PENSION INCOME POLITICAL ECONOMY POOR POOR HOUSEHOLDS POOR PARENTS POOR PEOPLE PROGRAM IMPACTS PROPENSITY SCORE MATCHING PUBLIC FINANCE QUASIEXPERIMENTAL DESIGNS RETURN RETURNS RURAL RURAL AREAS SAFETY NETS SOCIAL POLICIES SOCIAL SAFETY NETS SUBSTITUTION EFFECT TRANCHE TRANSITION ECONOMY Evans, David K. Popova, Anna Cash Transfers and Temptation Goods : A Review of Global Evidence
geographic_facet	Africa East Asia and Pacific Latin America & Caribbean South Asia Africa Asia Latin America
relation	Policy Research Working Paper;No. 6886
description	Cash transfers have been demonstrated to improve education and health outcomes and alleviate poverty in various contexts. However, policy makers and others often express concern that poor households will use transfers to buy alcohol, tobacco, or other "temptation goods." The income effect of transfers will increase expenditures if alcohol and tobacco are normal goods, but this may be offset by other effects, including the substitution effect, the effect of social messaging about the appropriate use of transfers, and the effect of shifting dynamics in intra-household bargaining. The net effect is ambiguous. This paper reviews 19 studies with quantitative evidence on the impact of cash transfers on temptation goods, as well as 11 studies that surveyed the number of respondents who reported they used transfers for temptation goods. Almost without exception, studies find either no significant impact or a significant negative impact of transfers on temptation goods. In the only (two, non-experimental) studies with positive significant impacts, the magnitude is small. This result is supported by data from Latin America, Africa, and Asia. A growing number of studies from a range of contexts therefore indicate that concerns about the use of cash transfers for alcohol and tobacco consumption are unfounded.
format	Publications & Research :: Policy Research Working Paper
author	Evans, David K. Popova, Anna
author_facet	Evans, David K. Popova, Anna
author_sort	Evans, David K.
title	Cash Transfers and Temptation Goods : A Review of Global Evidence
title_short	Cash Transfers and Temptation Goods : A Review of Global Evidence
title_full	Cash Transfers and Temptation Goods : A Review of Global Evidence
title_fullStr	Cash Transfers and Temptation Goods : A Review of Global Evidence
title_full_unstemmed	Cash Transfers and Temptation Goods : A Review of Global Evidence
title_sort	cash transfers and temptation goods : a review of global evidence
publisher	World Bank, Washington, DC
publishDate	2014
url	http://documents.worldbank.org/curated/en/2014/05/19546774/cash-transfers-temptation-goods-review-global-evidence http://hdl.handle.net/10986/18802
_version_	1764442728542765056

Cash Transfers and Temptation Goods : A Review of Global Evidence

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