Broken Promises: Evaluating an Incomplete Cash Transfer Program

Muller, Angelika, Utz Pape, Laura, Ralston

ABSTRACT

Interventions in highly insecure and fragile contexts are always confronted with the latent risk of not being able to implement the program as intended. Despite its high policy relevance, little is known about the impacts of program disruption or cancellation on beneficiaries. This study uses the unplanned cancellation of the South Sudan Youth Business Start-Up Grant Program to assess the socioeconomic, behavioral, and psychological consequences of a program that fails to be implemented as intended. Originally planned as a randomized trial, the Youth Startup Business Grant Program consisted of an unconditional cash grant combined with a business and life skills training targeting the youth in South Sudan. Due to the intensification of violence in the country, the disbursement of the grant was terminated in late 2016 before most of the intended beneficiaries had accessed the grant. The study uses survey data from face-to-face interviews and experimental data from lotteries, trust games, and a list experiment to assess the consequences of the cancellation in a comprehensive form. The empirical analysis employs instrumental variable regressions to control for individual characteristics that might have made it more likely to access the grant before disbursement was frozen. The results show that participants who received the originally planned treatment displayed significant improvements in their consumption, savings, and psychological well-being. However, participants who vainly expected to receive the cash grant showed reduced levels of consumption and women among this subgroup also experienced strong reductions in their trust level. In addition, the study finds some evidence that these women were less likely to migrate.