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Ideology or evidence? What does research tell us about common perceptions of cash transfers?

Dakar TP workshop 2017 A mother and infant receiving the first cash transfer payment as part of the Ghanaian government's LEAP 1000 programme in the village of Wantugu, Northern Region of Ghana.

(6 June 2017) A new UNICEF Innocenti Working Paper, Mythbusting? Confronting Six Common Perceptions about Unconditional Cash Transfers in Africa, summarizes evidence on six common assumptions about cash transfer programmes in Africa. The paper uses data from eight in-depth evaluations conducted on large government-run unconditional cash transfer projects in sub-Saharan Africa, under the Transfer Project.

The arguments supporting unconditional cash transfer programming for poor households in developing countries are numerous. Evidence shows cash transfers are effective in reducing poverty and also have widespread social and economic benefits – often larger than traditional forms of development assistance. An increasing body of evidence also shows that cash transfers may provide protection during humanitarian crises, as reflected in the high-level commitments at the World Humanitarian Summit, and the Grand Bargain.

Despite their widening application, and growing robust evaluation-evidence base, some skeptical policymakers cite anecdotal evidence that cash is wasted or mis-used. Others claim that beneficiaries use cash to purchase alcohol or tobacco, or that cash transfers create dependency or make beneficiaries lazy. Doubts have also been expressed regarding the cost of financing such programmes, along with fears that beneficiary households will decide to increase fertility in an effort to qualify for benefits (particularly in child-grant models).

According to the Transfer Project: “These narratives influence public perception of cash transfers and can play an important role in the political and social acceptability of financing, piloting and scaling up such programmes. What does the evidence say about these and other perceptions and claims around cash transfers? Are these anecdotes actually representative of systematic behaviour by programme recipients within large-scale, representative surveys?”

Making use of data drawn from eight rigorous evaluations on large-scale government unconditional cash transfer in sub-Saharan Africa, conducted by the Transfer Project, the new working paper summarizes evidence on six common perceptions about cash transfer programmes targeted to poor and vulnerable households. Namely that cash transfers:  

  1. Induce higher spending on alcohol or tobacco;
  2. Are fully consumed (rather than invested); 
  3. Create dependency (reduce participation in productive work);
  4. Increase fertility;
  5. Lead to negative community-level economic impacts (including price distortion and inflation); and
  6. Are fiscally unsustainable.

“We present evidence refuting each of these claims. We complement our evidence with summaries of other review papers and prominent literature, which has examined these questions, both in sub-Saharan Africa, and globally. We conclude that these perceptions are myths, and that they present a distorted picture of the potential benefits of these programmes,” say the authors of the new UNICEF Innocenti ‘Mythbusting’ working paper. 

Since such mis-perceptions often affect policy debates, they can unjustifiably limit the range of policy options low- and middle-income country governments have at their disposal to accelerate poverty reduction. The paper concludes by suggesting areas for future research on topics that are insufficiently studied, and calls for stakeholders to keep in mind the growing evidence base when informing programming and resource allocation, instead of relying on dated studies with little applicability to current programming, as well as on anecdotes, opinion or speculation. Efforts are required by all actors to ensure that ideology does not outweigh evidence. 

Related Articles

Dakar Transfer Project Workshop: The State of Evidence on Social Cash Transfers in Africa
Article Article

Dakar Transfer Project Workshop: The State of Evidence on Social Cash Transfers in Africa

(23 May 2017) There is more evidence now than ever before that cash transfers can empower families to improve their lives. In Africa, cash transfers are rapidly expanding as a key social protection tool for reducing chronic poverty and hunger and increasing investment in human capital. After nearly a decade, policymakers, researchers and staff from UN Agencies and NGOs will come together next month in Dakar, Senegal to discuss the evidence, share their experiences and look to new ways forward. The 2017 workshop, “The State of Evidence on Social Cash Transfers in Africa,” will take place from June 7-9, for the first time hosted in Francophone West Africa. The nearly 125 participants from 30 countries across the African region and beyond will gather with the objectives of: Increasing awareness of cross-regional evidenceIdentifying gaps for future researchMaking evidence-based recommendations for governments to improve design, implementation and integration of cash transfer programmes.The workshop comes on the heels of a recently published book highlighting the Transfer Project experience of social protection stakeholders working together to improve cash transfers. The authors reveal that one of the key components of successful cash transfers in Africa has been the transparency of knowledge sharing that occurs in the region – the upcoming workshop reinforces the strong collaboration among policymakers, development partners and researchers as they work together to improve policy, implementation and evaluation. Participants joining this year’s workshop will share the most up-to-date evidence on social, economic and productive impacts, continue to dispel myths, and address current challenges. In addition, it will feature presentations on innovative topics around targeting, fragile settings, mobile payments and local economy impacts, challenging participants to think more creatively about the next generation of programming and evaluation potential. George Okech, FAO Representative, ZambiaThe Dakar meeting happens at a strategic time when social protection initiatives – especially cash transfers – continue to gain steam throughout the world. Giving cash has been shown as an effective strategy in developing contexts and is being scaled-up in humanitarian and fragile settings. Additionally, albeit controversially, governments are experimenting with the idea of providing a universal basic income in industrialized countries as well.By taking the opportunity to debate, discuss and reflect on topics such as “cash plus” and others, stakeholders will advance their knowledge, be more equipped to make evidence-informed decisions and improve the implementation and the scale-up of social protection strategies. The Transfer Project offers just one example of a platform that provides space for honest discussions about the successes and challenges of cash transfers, while pushing the boundaries to explore alternative large-scale options that hold potential for being effective. By providing participants with practical and actionable recommendations, the workshop demonstrates how experts can come together to effectively exchange information and work on research uptake to improve the lives of children and their families and contribute to the realization of global development goals.However, experts will tell you that giving cash is not a “silver bullet” - it is one tool in a social protection package. One of the many topics that will discussed is the latest research on the potential of linking cash to services in the social, health and agricultural sectors, for example. These more comprehensive social protection packages being initiated by governments are known as “cash plus” interventions. As George Okech, FAO Representative in Zambia, describes: "We have realized that there are (anti-poverty) programmes that run parallel. If two different programmes are targeting the same community and they talk to one another, you get more benefits. So, these are things that can be improved; that’s why we need to have some coordination efforts…linking two or three programmes together (can have) a catalytic effect.” As social protection initiatives evolve, researchers will need to investigate how and to what extent cash plus programmes have greater effects than programmes operating separately in the most vulnerable communities. 2016 Transfer Project Workshop Participants, Addis Ababa, EthiopiaStay tuned for more information on the exciting activities in Dakar! Follow the event on social media: #TPDakar17 You can also view highlights from the 2016 workshop held in Addis Ababa, Ethiopia through the UNICEF Office of Research – Innocenti Youtube Channel: In English or in French.Since 2008, UNICEF has partnered with the UN’s Food and Agriculture Organization (FAO), the University of North Carolina at Chapel Hill (UNC) and Save the Children UK through the Transfer Project to gather rigorous evidence on national cash transfers throughout the region.

Research Projects

Social protection and cash transfers
Research Project Research Project

Social protection and cash transfers

 Social protection has significant positive impacts for poor and vulnerable children and their families. Cash transfers – regular, predictable payments of cash - are an important social protection modality. Research shows that cash transfers promote economic empowerment, while decreasing poverty and food insecurity. Our research goes beyond this to find out if and how cash transfers can be used more effectively to impact other aspects of people’s lives. Innocenti’s work on cash transfers forms part of an inter-agency research and learning initiative called the Transfer Project.A collaboration between UNICEF, FAO, University of North Carolina, and UNICEF country offices, the Transfer Project provides rigorous evidence on the impact of large-scale, typically unconditional national cash transfer programs in sub-Saharan Africa and countries in the Middle East. The project provides technical assistance in the design, implementation and analysis of Government programs in over a dozen countries, including Tanzania, Ghana, Mozambique and Malawi. The Transfer Project disseminates results to national and international stakeholders and holds a bi-annual workshop to promote cross-country learning and capacity building.The Transfer Project is a thought leader on cash transfers in Africa, with over a decade’s research. Findings indicate that cash transfers can: increase household productive capacity and resilience; create household and local economy spill overs; increase school enrollment and attendance;improve mental health and life satisfaction;delay sexual debut and reduce intimate partner violence, among others. However, numerous evidence gaps exist, including on promising ‘cash-plus’ designs, on long-term impacts and if impacts are transferable to fragile and humanitarian settings. While establishing effective social protection in the context of protracted instability and displaced populations is more complex, it is also increasingly viewed as an essential mechanism to bridge the humanitarian-developmental divide. Our project Social Protection in Humanitarian Settings is contributing to investigate what works, and why in those contexts.

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Cash Transfers Myths vs Reality - infographic poster
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