Beneficiary Views on Cash and In-Kind Payments : Evidence from Ethiopia's Productive Safety Net Program
Economists often default to the assumption that cash is always preferable to an in-kind transfer. Do beneficiaries feel the same way? This paper addresses this issue using longitudinal household data from Ethiopia where a large-scale social safety...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/568961580228524626/Beneficiary-Views-on-Cash-and-In-Kind-Payments-Evidence-from-Ethiopias-Productive-Safety http://hdl.handle.net/10986/33261 |
| Summary: | Economists often default to the
assumption that cash is always preferable to an in-kind
transfer. Do beneficiaries feel the same way? This paper
addresses this issue using longitudinal household data from
Ethiopia where a large-scale social safety net intervention
(PSNP) operates. Even though most payments are made in cash,
and even though the (temporal) transaction costs associated
with food payments are higher than payments received as
cash, most beneficiaries stated that they prefer their
payments only or partly in food. Higher food prices induce
shifts in stated preferences towards in-kind transfers. More
food secure households, those closer to food markets and to
financial services are more likely to prefer cash. Though
shifts occur, the stated preference for food is dominant: In
no year do more than 17 percent of households prefer only
cash. There is suggestive evidence that stated preferences
for food are also driven by self-control concerns. |
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