The Impacts of Cash and In-Kind Transfers on Consumption and Labor Supply : Experimental Evidence from Rural Mexico

The authors use the unique experimental design of the Food Support Program (Programa Apoyo Alimentario) to analyze in-kind and cash transfers in the poor rural areas of southern states of Mexico. They compare the impacts of monthly in-kind and cash transfers of equivalent value (mean share 11.5 percent of pre-program consumption) on household welfare as measured by food and total consumption, adult labor supply, and poverty. The results show that approximately two years later the transfer has a large and positive impact on total and food consumption. There are no differences in the size of the effect of transfer in cash versus transfers in-kind on consumption. The transfer, irrespective of type, does not affect overall participation in labor market activities but induces beneficiary households to switch their labor allocation from agricultural to nonagricultural activities. The analysis finds that the program leads to a significant reduction in poverty. Overall, the findings suggest that the Food Support Program intervention is able to relax the binding liquidity constraints faced by poor agricultural households, and thus increases both equity and efficiency.

Bibliographic Details

Main Authors:	Unar, Mishel, Skoufias, Emmanuel, González-Cossío, Teresa
Language:	English
Published:	Washington, DC: World Bank 2008-11
Subjects:	ADULT FEMALES, ADULT MALES, AGRICULTURAL ACTIVITIES, AGRICULTURAL ECONOMICS, AGRICULTURAL PRODUCTION, AGRICULTURE, BASIC FOOD BASKET, BASIC HEALTH, BASIC NEEDS, BENEFICIARY HOUSEHOLDS, CALORIES PER DAY, CASH INCOME, CASH TRANSFER PROGRAM, CASH TRANSFER PROGRAMS, CASH TRANSFERS, CEREALS, CHILD NUTRITION, CHOCOLATE, CONSUMER PRICE INDEX, CONSUMPTION AGGREGATE, CONSUMPTION EXPENDITURES, CONSUMPTION NEEDS, CONSUMPTION PATTERN, CONSUMPTION PATTERNS, CORN, COUNTERFACTUAL, DECOMPOSABLE POVERTY, DEMOGRAPHIC COMPOSITION, DEVELOPING COUNTRIES, DEVELOPMENT ECONOMICS, ECONOMIC DEVELOPMENT, ECONOMIC REVIEW, EMPLOYMENT, FLOUR, FOOD ASSISTANCE PROGRAMS, FOOD BASKET, FOOD BASKETS, FOOD CONSUMPTION, FOOD CONSUMPTION EXPENDITURES, FOOD CONSUMPTION PER CAPITA, FOOD DISTRIBUTION, FOOD EXPENDITURE, FOOD EXPENDITURES, FOOD ITEM, FOOD ITEMS, FOOD POLICY, FOOD POLICY RESEARCH, FOOD POVERTY, FOOD POVERTY LINE, FOOD PROGRAMS, FOOD SPENDING, FOOD STAMPS, FOOD TRANSFERS, FOODS, FRUITS, HEADCOUNT INDEX, HEADCOUNT POVERTY RATE, HEADCOUNT RATIO, HOUSEHOLD CHORES, HOUSEHOLD CONSUMPTION, HOUSEHOLD HEAD, HOUSEHOLD INCOME, HOUSEHOLD LEVEL, HOUSEHOLD SIZE, HOUSEHOLD WELFARE, HOUSEHOLDS WITH CHILDREN, IFPRI, IMPACT ON POVERTY, INCOME, INCOME TRANSFERS, INCOME VOLATILITY, INCOMPLETE MARKETS, INDIFFERENCE CURVE, INFLATION RATE, INSURANCE, INSURANCE MARKETS, INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE, IN­KIND TRANSFERS, LABOR ALLOCATION, LABOR ECONOMICS, LABOR FORCE, LABOR FORCE PARTICIPATION, LABOR MARKET, LABOR MARKET ACTIVITIES, LABOR MARKET PROGRAMS, LABOR SUPPLY, LIVING STANDARDS, LOW-INCOME HOUSEHOLDS, MACROECONOMIC SHOCKS, MEASUREMENT OF POVERTY, MEAT, MILK, NATIONAL FOOD POVERTY LINE, NONFOOD EXPENDITURES, NONFOOD ITEMS, NUTRITIONAL COMPONENT, NUTRITIONAL STATUS, PASTA, PER CAPITA CONSUMPTION, POLICY ANALYSIS, POOR, POOR COMMUNITIES, POOR HOUSEHOLDS, POOR INDIVIDUALS, POOR RURAL AREAS, POORER HOUSEHOLDS, POVERTY COMPARISONS, POVERTY GAP, POVERTY INDEX, POVERTY LINE, POVERTY LINES, POVERTY MEASURE, POVERTY MEASURES, POVERTY RATE, POVERTY RATES, POVERTY REDUCTION, POVERTY REDUCTION PROGRAMS, PRODUCTION SIDE, PRODUCTIVITY, QUALITY OF DIET, REAL TERMS, REDISTRIBUTIVE POLICIES, REDUCTION IN POVERTY, RELATIVE PRICES, RICE, RURAL, RURAL COMMUNITIES, RURAL HOUSEHOLD, RURAL HOUSEHOLD MEMBERS, RURAL HOUSEHOLDS, RURAL POOR, SCHOOL ATTENDANCE, SCHOOLING, SOCIAL ASSISTANCE, SOCIAL PROTECTION, SQUARED POVERTY GAP, STANDARD ERRORS, STARCH, TARGETING, TRANSACTION COSTS, TRANSFERS IN­KIND, UTILITY FUNCTION, VEGETABLES, VILLAGE ECONOMIES, VILLAGE LEVEL, WELFARE PROGRAM, WELFARE PROGRAMS, WHEAT,
Online Access:	http://documents.worldbank.org/curated/en/2008/11/10087907/impacts-cash-in-kind-transfers-consumption-labor-supply-experimental-evidence-rural-mexico https://hdl.handle.net/10986/6294
Tags:	Add Tag No Tags, Be the first to tag this record!