How to make cash transfers work
- Angry Priyanka Gandhi hits back at opponents, says her husband Robert Vadra is being 'maligned'
- Elections 2014 LIVE: UPA will hold together even in defeat, says Sharad Pawar
- Would prefer to go to Pakistan than stop criticising Narendra Modi: Omar Abdullah
- IPL spot fixing: Do you want to probe charges against Srinivasan? SC asks Justice Mudgal panel
- Hate speeches: Modi says petty statements by 'BJP well wishers deviating poll campaign'
A second presumption that should be reconsidered is that the money should be provided on a "family" basis. That may sound reasonable, until you try to operationalise it and think of the intra-family dynamics it will encourage. In our pilots in India, Latin America and Africa, we have found it is more efficient and equitable if cash transfers are provided to individuals, with the children's money being given to the mother or her surrogate.
Among the advantages we have observed in numerous households is that an individualised payment raises the status of women in the family and the status of the elderly and frail, each of whom has proper claim to the resources linked to the cash transfer. Moreover, defining what is the family or household is never easy or fixed. Doing such a policy on a family basis will create bureaucratic nightmares.
A third issue that some analysts want to introduce is conditionality. Beware of the "nudgers", those who think people must be induced to behave in ways they think is best for them. These paternalists will chip away at the freedom of low-income groups and move from one conditionality to more. We all have to learn to use cash in our lives. Conditionality is neither necessary nor desirable.
We have found that people act rationally by spending on their own priorities, such as on food for their children and medicines for them and themselves. They buy shoes for their children so that they can and do attend school more regularly. If the cash transfers are universal, neighbours put moral pressure on others to do the right thing. This is the normal human condition. Tell the nudgers to go home. Conditions attached to cash transfers are expensive to administer and arbitrary.
There are other conditions for success that should be considered. It will be important to roll out the scheme slowly and systematically, learning practical lessons in the process, without vast spending that would be involved if a rush forward were made. This is one reason for the success of Brazil's cash transfer scheme, the Bolsa Familia. It has been rolled out over the past decade, in the process showing the dangers of even modest conditionality.
- Five months after gruesome ATM attack, accused still at large
- Ex-syndicate member of Bangalore University held in marks-for-cash scam
- Accused get bail as police fail to file chargesheet
- ‘Naxals collected info on trucks carrying explosives from Khadki to Ahmednagar’
- A tale of two villages: Ramayan and Mahabharat
- UP CM tears into Modi bastion on first visit to Gujarat, says Third Front ready