Cash Transfer and the Labor Supply of Vulnerable Households and Individuals: Does Household Indebtedness Matter? A Triple DiD Analysis
Published in SSRN, 2024
Abstract
Cash transfers have been an effective mechanism in alleviating poverty, improving consumption, food security and health of the program beneficiaries. However, there are spillover effects of these programs such as its bidirectional effect on labor supply due to varied channels. One of the factors scholars overlook in the literature is household indebtedness. To that end, using a triple difference-indifference model, we enrich the existing literature by examining how debt moderates the impact of Ghana’s LEAP 1000 program on labor supply of the program recipients. Overall, the findings indicate that LEAP 1000 decreases indebted beneficiaries’ labor supply in terms of agriculture but an increase in labor-supply for non-farm enterprises. We recommend integrating financial management and debt relief into cash transfer program design to enhance its effectiveness in boosting labor market engagement and reducing poverty.
Recommended citation: Onyina, K. & Turkson, D. (2024). Cash Transfer and the Labor Supply of Vulnerable Households and Individuals: Does Household Indebtedness Matter? A Triple DiD Analysis (July 09, 2024). SSRN: Working Paper.
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