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Maximizing the Economic Impact of Cash Transfers: Why Complementary Investment Matters?

File Created On:
July, 2014

Source: IPC

The One Pager Maximizing the Economic Impact of Cash Transfers: why Complementary Investment Matters?, by Stephanie Levy (London School of Economics, Department of International Development) and Sherman Robinson (International Food Policy Research Institute Environment and Production Technology DivisionAbdel-Hameed Nawar) analyses the effects of cash transfers on small economies with market imperfections and poor rural-urban market linkages. Based on a Computable General Equilibrium macroeconomic model of the Cambodian economy, the study illustrates why cash transfers might induce domestic price increases, particularly for agricultural commodities, that could reduce the efficiency of the policy. This in turn calls for complementary measures to benefit both cash transfer recipients and the domestic economy.

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