Impacts of social safety nets policies. The power of transfer programs

Abstract

This thesis aims to assess whether social safety net policies used in a very poor country can concretely provide relief from poverty in the short run, while encouraging children education in the long run. The economic literature largely debates on the effectiveness of the social safety net tools, when applied in extremely poor condition. However, if well-tuned to target the right beneficiaries, social policies can be effective also in the poorest countries (Smith, 2001). In fact, by looking at Malawi, among the poorest countries in the world (170th out of 188 countries in the 2015 UNDP ranking), one can find highly significant effects for social safety net policies. More in detail, the first chapter of the thesis analyzes the different forms of social policy transfer, either in cash or in- kind, and provides an overview of the policies literature and their practical applications. The second chapter explains why Malawi has been chosen as a field of analysis. Among the poorest countries in the world, it is a country that adopted both cash and in-kind policies. The chapter describes the country profile and socio-political background, and the major efforts the country has gone through to improve living conditions of the poorest. In fact, despite its poverty situation, the Malawian government is deeply motivated to eradicate poverty and ending starvation, improving and protecting the livelihood of the most vulnerable. Finally, the third chapter provides an impact analysis of the main social safety net policies adopted in Malawi after 2004, by assessing their impact on school attendance. First by looking at the impact on school attendance of all social policies used in the country, which target ultra-poor people aged from 6 to 26 years old (considered as a broad schooling range period). Ultra-poor people are defined as living in families with no assets, very low income, being labor constrained and with a dependency ratio higher than three. Secondly, by looking at the impact of the two major in-kind programs present in this ambit (School Feeding and Mary’s Meals, which both give daily meals to children attending the primary school) and measuring their impact on the primary school attendance of children aged 6 to 13 years. In both kinds of analysis, we find significant and positive policy effects. However, if School Feeding and Mary’s Meals programs overlap in the same district, their policy impact is insignificant. Our results confirm and usefully complement the previously available evidence from the literature, which was linked to the experimental case studies, and thus presented problems of external validation.