Why Poverty Matters: A Leading Cause of Death.
Poverty affects millions of people globally, with more than 8% of the world population living in extreme poverty in 2019. The impact of insufficient income is widespread, from inadequate housing and education to poor health and low life expectancy.
According to the World Bank, the COVID-19 pandemic has forced an additional 97 million people into extreme poverty in 2020, leading more countries to adopt cash transfer programs. Of the 962 programs worldwide, 672 were established during the pandemic.
Direct cash transfers have been found to increase school attendance, improve nutrition, and promote the use of health services, and some studies in individual countries link these payments with reduced death rates. However, it remains unclear whether these trends apply globally.
“There are some concerns about whether these programs are sustainable or whether governments can and should pay for them,” said Harsha Thirumurthy, an economist at the University of Pennsylvania and co-author of the study.
Background: Small Payments Lead to Significant Changes.
Over 100 countries have introduced cash transfer programs designed to tackle poverty; however, the programs differ widely in payment amount, frequency, and recipient demographic.
This study is the first to examine the effect of cash transfers on death rates worldwide. Researchers collected data from 2000 to 2019 from 29 countries in sub-Saharan Africa, one in northern Africa, four in the Asia-Pacific region, and three in Latin America and the Caribbean. The information included over 4 million adults and almost 3 million children, with about 300,000 recorded deaths during the said period. Recipients received between 6% and 13% of the per capita income in the country, often less than $100.
“These are not amounts that are anywhere near as large as some of the amounts we’re talking about in the U.S. when it comes to guaranteed income programs,” Dr. Thirumurthy said.
The findings suggest that the benefits of cash transfers may be applicable not only to women but also to families and entire communities. However, the study did not examine the features of the programs, such as duration or frequency of payments, whether the beneficiaries were men or women, how the money was disseminated, or whether it was bundled with counseling or education.
Future Relevance: Positive Spillover Effects.
Because the researchers could not identify the beneficiaries, they analyzed population-level death rates. Programs like these, which account for most household income in places like South Africa, could lead to spillover effects, according to Audrey Pettifor, a social epidemiologist at the University of North Carolina. Additionally, cash transfers often lead to an improvement in healthcare and infrastructure for the beneficiaries, as noted by developmental economist Berk Özler in the World Bank’s research division.
Further studies should examine specific program features such as frequency and duration of payments, delivery method, counseling, or education. Dr. Thirumurthy acknowledges the need for future research.
