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Abstract

Savings play a crucial role in faciliating investment in income-generating activities and the pathway out of poverty for low-income households in developing settings. Yet there is little evidence of successful programmes that increase savings, particularly those that are simultaneously cost effective, scaleable and address gender inequalities. This paper examines the impact of the Government of Zambia’s Child Grant Programme (CGP), an unconditional cash transfer targeted to women in households with young children, on women’s savings and participation in non-farm enterprises. We use data over three years from a large-scale randomized controlled trial across three rural districts in Zambia. We find that the CGP enabled poor women to save more cash and that the impact is larger for women who had lower decision-making power at baseline. Moreover, we find that the programme increased diversification into non-farm enterprises that are traditionally operated by women, driven in part by the increased savings generated by the cash transfer. We posit that the key design feature of the programme that make these results possible is that the transfer is unconditional and paid directly to women. The results support the proposition that cash transfers have the potential for long-term sustainable improvements in women’s financial position and household well-being by promoting savings and facilitating productive investments among low-income rural households.

Sustainable Development Goals:
Related Subject(s): Children and Youth
Countries: Zambia

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http://instance.metastore.ingenta.com/content/papers/25206796/115
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  • Published online: 31 Mar 2016
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