The Impact of Cash and Food Transfers: Evidence from a Randomized Intervention in Niger

We contribute to debates regarding the use of cash and in-kind transfers by providing new evidence from a very low income setting, rural Niger. We motivate our findings through the use of a conceptual model that emphasizes that the impact of cash and food transfers on dimensions of food consumption—both quantity and quality—will differ by the income level of the household and whether or not the food transfer is extra-marginal. Consistent with this model, households in localities randomized to receive the food basket experienced larger, positive impacts on measures of dietary diversity than those receiving the cash transfer. By contrast, households receiving cash were more likely to make bulk purchases of grains and spent more money on private transfers and debts. Despite the seasonal dimensions to food insecurity in Niger, the relative impact of food and cash transfers on our measures of dietary diversity did not vary markedly by season.