Testing Paternalism: Cash versus In-Kind Transfers
- (pp. 195-230)
Abstract
Welfare programs are often implemented in-kind to promote outcomes that might not be realized under cash transfers. This paper tests whether such paternalistically motivated transfers are justified compared to cash, using a randomized controlled trial of Mexico's food assistance program. In relation to total food consumption, the in-kind transfer was infra-marginal and nondistorting. However, the transfer contained ten food items, and there was large variation in the extent to which individual foods were extra-marginal and distorting. Small differences in the nutritional intake of women and children under in-kind transfers did not lead to meaningful differential improvements in health outcomes compared to cash.Citation
Cunha, Jesse M. 2014. "Testing Paternalism: Cash versus In-Kind Transfers." American Economic Journal: Applied Economics, 6 (2): 195-230. DOI: 10.1257/app.6.2.195Additional Materials
JEL Classification
- I14 Health and Inequality
- I18 Health: Government Policy; Regulation; Public Health
- I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
- O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
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