Evidence on the comparative cost efficiency and effectiveness of varying social assistance modalities

Question

What is the evidence on the comparative cost efficiency and effectiveness of different social assistance modalities (particularly cash transfers, food vouchers and food distribution), taking into consideration the range of associated costs and benefits, with emphasis on conflict affected and protracted crisis settings, particularly in the MENA region.

Summary

There is limited literature that rigorously measures cost efficiency of programme modalities, or that compares modalities. The key points raised in the literature include the following:

  • Transfer appropriateness is context-specific and determined by multiple factors including programme objectives
  • Cash transfers are generally found to be the least-cost modality – which suggests opportunities to expand coverage or build complementarities
  • The provision of cash requires well-functioning local food markets – questions of access to markets, increase in supplies to local markets, potential price fluctuations and competitiveness should be assessed
  • Consideration should be given to transfer value and price fluctuations, particularly for cash and vouchers, as they are rarely index-linked and risk potential value loss when food prices rise – from this perspective, in-kind food transfers shield beneficiaries from inflation while cash transfers risk erosion
  • Different priorities may compete, such as timeliness, cost-effectiveness, local market effects, recipient satisfaction, food quality, impact on smallholder suppliers, and livelihoods
  • A single modality may not be always preferable
  • Intra-household preferences and intended beneficiary choices on type of modality should be assessed.

Enquirer:

Suggested citation

Pozarny, P. (2016). Evidence on the comparative cost efficiency and effectiveness of various social assistance modalities (GSDRC Helpdesk Research Report 1323). Birmingham, UK: GSDRC, University of Birmingham.