• Risk Sharing and Transactions Costs: Evidence from Kenya's Mobile Money Revolution

    Jack and Suri (2011)

    Original Abstract:

    We explore the impact of reduced transaction costs on risk sharing by estimating the effect of mobile money on household consumption. Over a two-year period, household adoption increased from 43 to 70 percent, while the number of cash-in and cash-out agents increased four-fold. Using panel data we collected, we found that while shocks reduce per capita consumption by 7 percent for non-user households, the consumption of households with access is unaffected. The mechanism underlying this effect is an increase in remittances received, in number, size and diversity of senders. A falsification test using data prior to the innovation supports these results.

    Intervention settings: National.

    Intervention description: Extension of M-Pesa mobile money agent coverage.

    Methodology: Difference in differences and instrumental variable estimation using panel data.

    Sample: Randomly selected households from 102 locations, in areas accounting for 92% of Kenya's population.

    Findings: Access to M-Pesa increases a household's ability to smooth consumption in response to a negative income shock. For households that do not use M-PESA or households that lack access to the M-PESA agent network, per capita consumption fell by 7-10% on average when they experience a negative income shock. However, M-PESA user households experienced "no such fall in per capita consumption" and often the post-shock consumption fall was statistically indistinguishable from zero. The effects were greater for households in lower income distribution quintiles than those in higher quintiles. Effects are due to improved risk sharing, not liquidity effects. M-PESA user HH are different from non-user HH (13% more likely to receive remittances; they also receive remittances from a larger network).

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  • Are Poor Slum-dwellers Willing to Pay for Formal Land Title? Evidence from Dar es Salaam

    Ali et al (2012)

    Intervention settings:

    Intervention description: Land titling.

    Methodology: RCT

    Sample: 1,059 households (22% women-headed).

    Findings: Dissemination activities had positive impact on listing of female co-owners. Demand for a Certificate Right of Occupancy among urban slum dwellers was high relative to income and to cost of other options.

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  • Cash or Condition? Evidence from a Cash Transfer Experiment

    Baird, McIntosh and _zler (2011)

    Original Abstract:

    This paper assesses the role of conditionality in cash transfer programs using a unique experiment targeted at adolescent girls in Malawi. The program featured two distinct interventions: unconditional transfers (UCT arm) and transfers conditional on school attendance (CCT arm). While there was a modest decline in the dropout rate in the UCT arm in comparison to the control group, it was only 43% as large as the impact in the CCT arm at the end of the two-year program. The CCT arm also outperformed the UCT arm in tests of English reading comprehension. However, teenage pregnancy and marriage rates were substantially lower in the UCT than the CCT arm, entirely due to the impact of UCTs on these outcomes among girls who dropped out of school.

    Intervention settings: Rural (mostly): Zomba district

    Intervention description: Cash transfers varied randomly (at level of enumerator area) between $4, $6, $8 and $10 per month to parents and between $1, $2, $3, $4 and $5 to student beneficiaries. In addition, CCT recipients' secondary school fees were paid. For conditional treatment arms, payment was made if attendance the previous month was at least 80% of school days. Unconditional arm had identical offer except payment was not conditional on attending school, and payments were adjusted upward to match the amount of school fees plus cash transfer that CCT arm received.

    Methodology: RCT

    Sample: 2,907 school girls in 176 enumeration areas.

    Findings: Decrease in the drop-out rate in the UCT group only 43% as large as that in the CCT group.

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  • Does ICT Benefit the Poor? Evidence from South Africa.

    Klonner and Nolen (2008)

    Original Abstract:

    We study the economic effects of the roll-out of mobile phone network coverage in rural South Africa. We address identification issues which arise from the fact that network roll-out cannot be viewed as an exogenous process to local economic development. We combine spatially coded data from South Africa's leading network provider with annual labor force surveys. We use terrain properties to construct an instrumental variable that allows us to identify the causal effect of network coverage on economic outcomes under plausible assumptions. We found substantial effects of cell phone network roll-out on labor market outcomes with remarkable gender-specific differences. Employment increases by 15 percentage points when a locality receives network coverage. A gender-differentiated analysis shows that most of this effect is due to increased employment by women. Household income increases in a pro-poor way when cellular infrastructure is provided.

    Intervention settings: Rural

    Intervention description: Extension of mobile phone network.

    Methodology: Instrumental variable estimation.

    Sample: Data from two nationally representative household surveys.

    Findings: Employment increases by 15 percentage points, with most of the effect concentrated in females. Positive effect on household income among households with no children. No effect on average household income or moderate poverty. Reduces severe poverty.

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  • Environmental and Gender Impacts of Land Tenure Regularization in Africa: Pilot Evidence from Rwanda

    Ali, Deininger and Goldstein (2011)

    Original Abstract:

    Although increased global demand for land has led to renewed interest in African land tenure, few models to address these issues quickly and at the required scale have been identified or evaluated. The case of Rwanda's nation- wide and relatively low-cost land tenure regularization program is thus of great interest. This paper evaluates the short-term impact (some 2.5 years after completion) of the pilots undertaken to fine-tune the approach using a geographic discontinuity design with spatial fixed effects. Three key findings emerge from the analysis. First, the program improved land access for legally married women (about 76 percent of married couples) and prompted better recordation of inheritance rights without gender bias. Second, the analysis finds a very large impact on investment and maintenance of soil conservation measures. This effect was particularly pronounced for female headed households, suggesting that this group had suffered from high levels of tenure insecurity, which the program managed to reduce. Third, land market activity declined, allowing rejection of the hypothesis that the program caused a wave of distress sales or widespread landlessness by vulnerable people. Implications for program design and policy are discussed.

    Intervention settings: Rural (3 locations) and peri-urban (1 location).

    Intervention description: Land titling pilot covering 14,908 parcels with 3,448 hectares.

    Methodology: Regression discontinuity design with spatial fixed effects.

    Sample: 3,513 households (22% female-headed) drawn from both sides of the boundaries of four pilot cells.

    Findings: The program improved land access for legally married women (about 76% of married couples) and prompted better recordation of inheritance rights without gender bias. The analysis finds a large impact on investment and maintenance of soil conservation measures. This effect was particularly pronounced for female headed households, suggesting that this group had suffered from high levels of tenure insecurity, which the program managed to reduce. Land market activity declined, allowing rejection of the hypothesis that the program caused a wave of distress sales or widespread landlessness by vulnerable people. No effect on the perceived risk of expropriation.

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  • Empowering Adolescent Girls: Evidence from a Randomized Control Trial in Uganda

    Bandiera et al (2012)

    Original Abstract:

    Nearly 60% of Uganda's population is aged below 20. This generation faces health challenges associated with HIV, coupled with economic challenges arising from an uncertain transition into the labor market. We evaluate the impacts of a programme designed to em- power adolescent girls against both challenges through the simultaneous provision of: (i) life skills to build knowledge and reduce risky behaviors; (ii) vocational training enabling girls to establish small-scale enterprises. The randomized control trial tracks 4,800 girls over two years. The programme significantly improves HIV and pregnancy related knowledge, as well as corresponding risky behaviors: among those sexually active, self-reported routine condom usage increases by 50%. Furthermore, from a baseline of 21%, there is the near elimination of girls reporting having recently had sex unwillingly. On outcomes related to vocational training, the intervention raised the likelihood of girls being engaged in income generating activities by 35%, mainly driven by increased participation in self-employment. The findings suggest combined interventions might be more effective among adolescent girls than single-pronged interventions aiming to change risky behaviors solely through related education programmes, or to improve labor market outcomes solely through vocational training.

    Intervention settings: Rural and Peri-urban

    Intervention description: Livelihood (vocational) and life skills training over first two years of the program.

    Methodology: RCT

    Sample: 4,800 young women (aged 14-20).

    Findings: 35% increase in likelihood to be engaged in an income generating activity. 76% increase in likelihood to be self-employed. 46% increase in hours spent in self-employment on a typical day. 17% decrease in likelihood to be in wage-labor (imprecisely estimated). 31% decrease in hours spent in wage-labor on a typical day (imprecisely estimated). Personal monthly expenditure on goods specific to young females higher by 33%. Income from self-employment higher, wage labor lower.

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  • Mobile Banking: The Impact of M-Pesa in Kenya

    Mbiti and Weil (2011)

    Original Abstract:

    M-Pesa is a mobile phone based money transfer system in Kenya which grew at a blistering pace following its inception in 2007. We examine how M-Pesa is used as well as its economic impacts. Analyzing data from two waves of individual data on financial access in Kenya, we find that increased use of M-Pesa lowers the propensity of people to use informal savings mechanisms such as ROSCAS, but raises the probability of their being banked. Using aggregate data, we calculate the velocity of M-Pesa at between 11.0 and 14.6 person-to-person transfers per month. In addition, we find that M-Pesa causes decreases in the prices of competing money transfer services such as Western Union. While we find little evidence that people use their M-Pesa accounts as a place to store wealth, our results suggest that M-Pesa improves individual outcomes by promoting banking and increasing transfers.

    Intervention settings: National.

    Intervention description: Availability of mobile moves service.

    Methodology: Fixed and random effects estimation using panel data.

    Sample: Aggregated household data from two nationally representative surveys conducted in 190 sublocations (i.e., clusters of 2-3 villages).

    Findings: The primary use of M-Pesa is the purchase of airtime - 42 percent of users. Contradictory to findings by Jack and Suri (2011) they find that only 26 percent of M-Pesa users report using the service for savings. Very small percentages of users report using M-Pesa for direct purchasing, paying bills or receiving salaries or wages. M-Pesa users are more likely to be male, wealthier, better educated, banked in the formal sector, employed in non-farm sectors and reside in urban areas. 35% of banked individuals use M-Pesa to save, compared to only 19% of the unbanked that use it as a savings tool. Wealthy individuals also more frequently use M-Pesa as a savings tool - 30% - as compared to poor individuals at 15%. Men use M-Pesa 35% more frequently than women. 35% of respondents indicated that they had increased the frequency of sending transfers and 18% indicating that they had decreased the frequency. Approximately 35% of M-Pesa users indicated that they had sent higher amounts in the transfers they had made and almost 20% stated they had decreased the amount. Positive relationship between M-Pesa adoption and the frequency of sending transfers. M-Pesa adoption increased the frequency of sending remittances by 2.

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  • Rural Land Certification in Ethiopia: Process, Initial Impact, and Implications for Other African Countries

    Deininger, Ali, Holden, and Zevenbergen (2008)

    Original Abstract:

    Although many African countries have recently adopted highly innovative and pro-poor land laws, lack of implementation thwarts their potentially far-reaching impact on productivity, poverty reduction, and governance. We use a representative household survey from Ethiopia where, over a short period, certificates to more than 20 million plots were issued to decribe the certification process, explore its incidence and preliminary impact, and quantify the costs. While this provides many suggestions to ensure sustainability and enhance impact, Ethiopia's highly cost-effective first-time registration process provides important lessons.

    Intervention settings: Nationwide.

    Intervention description: Rural land certification.

    Methodology: Probit, Tobit.

    Sample: 2,300 households (16% women-headed) in 115 villages (kebeles).

    Findings: Land was registered with rapid speed, in a participatory nature, and at low cost. The process did not favor the wealthy and was not biased against women. Study was preliminary and descriptive, and did not show detailed evidence of certification impacts on productivity and land market behavior.

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  • Employment Generation in Rural Africa: Mid-term Results from an Experimental Evaluation of the Youth Opportunities Program in Northern Uganda

    Blattman et al (2011)

    Original Abstract:

    Can cash transfers promote employment and reduce poverty in rural Africa? Will lower youth unemployment and poverty reduce the risk of social instability? We experimentally evaluate one of Uganda's largest development programs, which provided thousands of young people nearly unconditional, unsupervised cash transfers to pay for vocational training, tools, and business start_up costs. Mid_term results after two years suggest four main findings. First, despite a lack of central monitoring and accountability, most youth invest the transfer in vocational skills and tools. Second, the economic impacts of the transfer are large: hours of nonhousehold employment double and cash earnings increase by nearly 50% relative to the control group. We estimate the transfer yields a real annual return on capital of 35% on average. Third, the evidence suggests that poor access to credit is a major reason youth cannot start these vocations in the absence of aid. Much of the heterogeneity in impacts is unexplained, however, and is unrelated to conventional economic measures of ability, suggesting we have much to learn about the determinants of entrepreneurship. Finally, these economic gains result in modest improvements in social stability. Measures of social cohesion and community support improve mildly, by roughly 5 to 10%, especially among males, most likely because the youth becomes a net giver rather than a net taker in his kin and community network. Most strikingly, we see a 50% fall in interpersonal aggression and disputes among males, but a 50% increase among females. Neither change seems related to economic performance nor does social cohesion a puzzle to be explored in the next phase of the study. These results suggest that increasing access to credit and capital could stimulate employment growth in rural Africa. In particular, unconditional and unsupervised cash transfers may be a more effective and cost-efficient form of large-scale aid than commonly believed. A second stage of data collection in 2012 will collect longitudinal economic impacts, additional data on political violence and behavior, and explore alternative theoretical mechanisms.

    Intervention settings: Urban and Rural

    Intervention description: Cash grant of $304 per average beneficiary.

    Methodology: RCT

    Sample: 2,000 individuals (aged 16 to 35) then placed into groups.

    Findings: Hours spent on income-generating activities increases by 24%. Earnings increase 18% but statistically insignificant (linear estimate).

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  • The impact of mobile phone coverage expansion on market participation: panel data evidence from Uganda

    Muto and Yamano (2008)

    Original Abstract:

    Uganda has experienced recently a rapid increase of area covered by mobile phone. As the information flow increases due to the mobile phone coverage expansion, the cost in crop marketing is expected to decrease, particularly more so for perishable crops, such as banana, in remote areas. We use panel data of 856 households in 94 communities, where the number of the communities covered by the mobile phone network increased from 41 to 87 communities over a two-year period between the first and second surveys in 2003 and 2005, respectively. We find that the proportion of the banana farmers who sold banana increased from 50 to 69 percent in the communities more than 20 miles away from district centers after the expansion of the mobile phone coverage. For maize, which is another staple but less perishable crop, we find that mobile phone coverage did not affect market participation. These results suggest that mobile phone coverage expansion induces market participation of farmers who are located in remote areas and produce perishable crop.

    Intervention settings: Rural.

    Intervention description: Expansion of mobile phone coverage.

    Methodology: Fixed-effects instrumental variable estimation.

    Sample: Households in 94 communities where information was collected about men and women in HH.

    Findings: Participation of farmers in marketing bananas (a perishable crop) increased from 50-69% in communities more than 20 kilometers from district centers. No effect on participation of maize marketing (a less perishable crop).

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