Social Transfers and Growth: A Review

Abstract

A considerable and growing literature exists on social transfers in developing countries, that is, direct transfers in cash or kind to individuals or households in poverty. Many studies have examined the contribution social transfers can make to reducing poverty and vulnerability in the developing world, but less attention has been paid to how social transfers might affect growth. This Review examines the available evidence on the effects social transfers may be expected to have on growth at the micro-level. It identifies and assesses a number of pathways through which social transfers can potentially contribute either to enhancing or impeding growth. This paper argues that in assessing the growth impacts of social transfers it is important to focus on the poor and their circumstances. The discussion of the linkages between social transfers and growth in developed countries focuses on crosscountry empirical studies, testing the hypothesis that if social expenditures are harmful to growth performance then they will show a negative correlation with growth across a sample of countries.

Government Spending and People Welfare; in Southeast Sulawesi, Indonesia

“…The findings for the Southeast Sulawesi citizen theory only supports the argument-over-state with respect to the positive association between shopping transfer to the human development index, poverty, and the net enrollment rate of primary education; positive association between public spending on goods and services with the physical quality of life index; and a positive association between general government expenditure with the GDP per capita. Previous empirical literature (Hong and Ahmed, 2009;Barrientos and Scott, 2008) has confirmed the argument.…”

Beneficiary Selection and Allowance Utilization of Social Safety Net Programme in Bangladesh

“…Strengthening the local government bodies that are the prime movers in selecting beneficiaries and implementing the programmes and making their activities transparent will also help to bring efficiency in the process. Such initiatives will contribute toward selecting the right people for the social protection transfers, which will ultimately help to address poverty, economic hardship, vulnerabilities, and human rights (Alderman and Yemtsov 2012;Barrientos and Niño-Zarazua 2010;Barrientos and Scott 2008;Holmes et al 2008;ILO 2011;Sabates-Wheeler and Devereux 2008;Sepúlveda and Nyst 2012).…”

“…Barrientos and Scott (2008) suggest that social transfers need to be regular and reliable and offer adequate level of support in order to facilitate household investment and graduation from poverty. However, it is evident from the study area that more than 60% of total allowances received by the beneficiaries are spent for food expenditure.…”

“…Social protection transfers help individuals to strengthen and accumulate productive assets and thus help them to enhance their future income earning capacity (Barrientos and Scott 2008;Alderman and Yemtsov 2012). Holmes et al (2008) suggest that social protection reduces the constraints faced by extremely poor households to engage in productive activities.…”

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) as Social Safety Net: Analysis of Public Works in Odisha, India

“…For these reasons, general comparisons of social security schemes may not necessarily be meaningful (Barrientos et al 2008;Jorgensen et al 2009). …”