The Asset Transfer Project aims to evaluate the effectiveness of asset and cash transfers, hence providing policy recommendations towards designing the best social safety net which can improve incomes of the ultra poor belonging to four districts of Punjab, Pakistan.
More than 40 million people live below the national poverty line in Pakistan. Ten million of them reside in the rural southern districts of Punjab. The asset transfer program is being implemented by National Rural Support Program (NRSP) and Farmer Development Organization (FDO) in four districts of Southern Punjab namely; Bahawalpur, Muzzaffargarh, Lodhran, and Bahawalnagar. Theoretical research has shown that asset-transfer programmes coupled with complementary training, significantly and permanently raise the economic well-being of ultra-poor households’ through their engagement in basic entrepreneurship. There is also evidence that UCTs foster entrepreneurial activity. Using randomized control trials, our research is among the first to compare these kinds of asset transfer programmes to UCTs in local context of Pakistan.
This program addresses a question central to the design of social protection programs: Are asset transfer programs more effective than cash transfers in developing countries? The program divides the total sample into two treatment arms where randomly selected ultra and vulnerable poor households will either receive an asset or cash from partner organizations.
The first treatment arm (30 mouzzas) is a replica of regular asset transfer programs where an in-kind asset, of any combination up to the value of PKR 50,000, combined with complementary trainings is provided to beneficiaries, whereas in the second treatment arm (29 mouzzas), beneficiaries also have a choice of choosing equivalent amount of cash instead of asset and trainings. The findings from these two treatment arms will be compared against a control group (90 mouzzas).
Our experimental research design estimate the causal impacts of both choices on various outcomes such as labour productivity, income generating activities, earnings and its volatility, consumption and asset holdings. This data allows us to shed light on the how markets operate rural areas of Pakistan and how market failures can be catered using asset and cash transfers.
The findings from this project can help governmental and nongovernmental social safety net providers in various ways. Our research project directly feeds into the design of asset transfer programmes of PPAF-the largest pro poor spending agency in Pakistan; and also informs the design of social protection programmes by Benazir Income Support Programs. The Planning and Development Department Punjab had requested this evaluation and its Chairman has committed, most recently at IGC Growth Week 2013, to create synergies between this project and others and to take its results to policy for all such programmes in the province.