Cash or Vouchers: The Relative Impacts of Cash and Vouchers in the Democratic Republic of Congo

1. Cash or Vouchers?
The Relative Impacts of Cash and Vouchers in
the Democratic Republic of Congo
Jenny C. Aker, Tufts University
IFPRI
November 7, 2013
Jenny C. Aker Cash and Vouchers in DRC

2. Motivation
• How should society (donors, governments and
NGOs) redistribute to the poor?
• Cash transfer programs are an increasingly important
part of social protection programs in both developed
and developing countries
• Majority of welfare transfers are still “in-kind”
 Food aid, food stamps, medicines, inputs, vouchers
 Especially in developing (conflict) countries
Jenny C. Aker Cash and Vouchers in DRC

3. International Cash and In-Kind Transfers
% of USAID Emergency Food Security Program
Budget
90%
80%
2011
Total: $232 million
79%
2012
Total: $374 million
% of EFSP Budget
70%
60%
50%
44%
42%
40%
30%
20%
14%
9.0%
10%
12%
0%
In-Kind
(Local/Regional Purchase)
Vouchers
Cash Transfers
Type of Assistance
Source: Congressional Research Service, 2013
Jenny C. Aker Cash and Vouchers in DRC

4. Motivation
• If program recipients would weakly prefer an equalvalued cash transfer to an in-kind transfer, why not
use cash?
• Cash might not be the preferred modality for
redistributing wealth
 Targeting
 Local supply
 Political feasibility
 “Paternalism”
• Little evidence of the relative effects of each
modality in developing countries
Jenny C. Aker Cash and Vouchers in DRC

5. Jenny C. Aker Cash and Vouchers in DRC

6. Jenny C. Aker Cash and Vouchers in DRC

7. Research Questions
Goals
Research
• What are the relative effects of cash versus in-kind
transfers (vouchers) on household
purchases, consumption and other measures of wellbeing?
• Households randomly assigned to equal-valued cash
or voucher transfer
 No pure comparison group
• Assess impact on purchasing
decisions, consumption, other indicators of wellbeing
• Investigate mechanisms
Jenny C. Aker Cash and of each modality
• Calculate the cost-effectiveness Vouchers in DRC

8. Preview of Findings
• Starkly different purchasing patterns between the
two modalities
Voucher transfer extra-marginal for some food items
• Few differential effects on other outcomes (food
security, food expenditures, assets, coping
strategies)
 Cash households were able to save more of their transfer
• Different purchases primarily due to program
design, but voucher could be resold
• Costs of voucher program higher for implementing
agency (and potentially program recipients)
Jenny C. Aker Cash and Vouchers in DRC

9. Related Literature
• In-kind transfers
 Food stamps in the US (Moffitt 1989, Fraker et al
1995, Whitmore 2002, Hoynes and Schazenbach 2009)
• Unconditional cash transfers
 Increased food consumption (Hoddindott and Skoufias
2004, Attanasio and Mesnard 2005, Maluccio 2007), improved
child health (Gertler 2004)
• Conditional versus unconditional cash transfers (Baird et al
2011)
• Cash versus food transfers (Del Ninno and Dorosh
2003, Ahmed et al 2009, Cunha 2012, Hoddinott et al
2013, Gilligan et al 2013)
• Cash, food and vouchers (Hidrobo et al 2012)
Jenny C. Aker Cash and Vouchers in DRC

10. Democratic Republic of Congo
• Civil war since the 1990s
 “Africa’s world war”
 Over three million people killed
 Peace deal in 2003, but continued fighting and millions internally
displaced (1.7 million as of July 2011)
• Internally displaced populations live in host communities
and/or camps
 Few income-generating opportunities, little access to basic needs
 International organizations provide in-kind transfers (seeds and
tools, non-food items, vouchers) and cash (primarily cash-for-work)
• Limited investment in basic infrastructure
(roads, power, landlines, mobile phones)
 Markets still function (three markets within a 20-km radius of the
camp)
Jenny C. Aker Cash and Vouchers in DRC

12. Transfer Program
• Implemented by Concern Worldwide in one
informal camp (Bushani)
All households in the camp eligible for the transfer
Transfer provided to the woman within the household
• US$130 transfer provided in three installments
between September 2011 and March 2012
US$90 provided in September 2011, US$20 provided in
October 2011 and US$20 in March 2012
Provided to increase asset accumulation (NFIs) and
meet food needs
All households had to travel to Masisi (3 hours’ walk) to
obtain their transfer
Jenny C. Aker Cash and Vouchers in DRC

13. Bushani Camp
Nyabiondo
Masisi

14. Research Design
• 474 households stratified by neighborhood and randomly
assigned to one of two transfer modalities
• T1: Unconditional cash transfer. Cash transfers provided in
three installments
• T2. Voucher. Vouchers provided in three installments
 First voucher could be spent on food and non-food items at a
“multisectoral fair”
 Second and third vouchers could only be spent on food items
• Equivalently-valued transfers provided at same time and same
amounts
• Both groups had to travel to main urban center (Masisi, 15 km
from camp) to pick up their transfer
• Voucher households informed of the restriction in advance
• No pure comparison group
Jenny C. Aker Cash and Vouchers in DRC

15. Voucher Fair

16. Voucher Fair
• First voucher fair: Included over 122 vendors
and four primary schools in the area, and
provided access to NFIs, household
items, clothes, school fees, agricultural inputs
(seeds and tools), and small animals.
• Second and third voucher fairs: Vouchers
could be spent on food at “open
markets”, whereby program recipients could
circulate freely among pre-arranged
boutiques and kiosks.
o Vouchers could not be used to purchase meat and
condiments.

17. Why Vouchers?
•
•
•
•
•
Paternalism
Targeting
Market supply
Political feasibility
Security
Jenny C. Aker Cash and Vouchers in DRC

18. Why Vouchers?
•
•
•
•
•
Paternalism
Targeting
Market supply
Political feasibility
Security
Jenny C. Aker Cash and Vouchers in DRC

19. External Validity
• Design similar to other voucher programs in
humanitarian contexts
• Differs from “traditional” voucher transfers by:
• Timing – had to be spent in one day
• Location – could only be spent at voucher fair
(rather than vendors, kiosks or marketes in
different locations)

20. Theoretical Framework
qNFI
A
B
qFood
Jenny C. Aker Cash and Vouchers in DRC

21. Cash Transfer
qNFI
A’
A
B’
B
T/pFood
qFood
Jenny C. Aker Cash and Vouchers in DRC

22. Voucher with no resale
A’’: Voucher is extra-marginal and binding
qNFI
A’
A’’
B’: Voucher is infra-marginal
A
B’
B
qF=T/pFood
qFood
Jenny C. Aker Cash and Vouchers in DRC

23. Voucher with resale
A’’: Voucher is extra-marginal and binding
qNFI
A’
A’’’
A’’’: Voucher is extra-marginal and non-binding
A’’
B’: Voucher is infra-marginal
A
Can also affect
preferences and make
the goods more
substitutable
B’
B
qF=T/pFood
qFood
Jenny C. Aker Cash and Vouchers in DRC

24. Theoretical Predictions
• If transfers are extra-marginal, then there should
be differential effects of cash and vouchers on
household purchases
• If vouchers are binding, then there should be
differential effects of cash and vouchers on
consumption
• But would these differences lead to improved wellbeing?
Jenny C. Aker Cash and Vouchers in DRC

25. Data
Data
• Panel survey of 250 households over three rounds
(September 2011, November 2011 and March 2012)
 Data on uses of transfer, assets, income sources, food
security
 No full expenditure or consumption module but income and
food expenditures from the previous week
 Extensive margin of purchases for each transfer, and
quantities purchased for subset of goods
• Price data for 40 products on the primary market and
voucher fairs
• Exit surveys from voucher fairs and cash transfer recipients
on purchases
• Cost data for each transfer modality
Jenny C. Aker Cash and Vouchers in DRC
25

26. Project Timeline
Project Timeline
Year
February
March
April
May
June
July
August
Design
program
2011
September
October
Identify
First cash
Second
program transfer and
cash
recipients
voucher
transfer
and assign (multisectora
and
household
l fair)
voucher
s
distribution
Baseline
(food fair)
survey
November
December
Midterm
survey
Monitor voucher fairs, prices, security situation
2012
Third cash
transfer
and
voucher
distributio
n
Final
household
survey
Jenny C. Aker Cash and Vouchers in DRC
26

27. Project Timeline
Jenny C. Aker Cash and Vouchers in DRC

28. Variables
Table 1. Comparison of Pre-Program Characteristics
Voucher
Cash
Mean (s.d.)
Panel A: Socio-Demographic Characteristics
Household size
Number of children (less than 15 years of age)
Program recipient is married
Program recipient is widowed
Age of program recipient
Program recipient has some education
Program recipient born in Masisi Territory
Number of years living in the camp
Mean (s.d.)
5.40
(2.00)
3.23
(1.87)
0.69
(0.42)
0.21
(0.35)
34.15
(14.19)
0.50
(0.50)
0.96
(0.19)
1.53
(0.76)
5.55
(1.85)
3.21
(1.58)
0.78
(0.42)
0.15
(0.41)
34.87
(13.12)
0.48
(0.50)
0.87
(0.33)
1.42
(0.82)
p-value
Jenny C. Aker Cash and Vouchers in DRC
0.314
0.888
0.285
0.272
0.503
0.767
0.04**
0.867

29. Table 1. Comparison of Pre-Program Characteristics
Variables
Voucher
Cash
Panel B: Income and Income Sources
Number of income sources
1.73
1.82
(0.72)
(0.93)
Total income earned during the past week (Congolese Franc)
2387
2491
(4610)
(4863)
Value of food purchases in the past week (Congolese Franc)
1883
1729
(4531)
(1536)
Panel C: Agricultural Production and Livestock
Had access to land
0.02
0.02
(0.15)
(0.13)
Owned poultry
0.02
0.04
(0.12)
(0.20)
Panel D: Asset Ownership
Total value (USD) of assets
62.30
60.60
(24.52)
(25.50)
Number of durable goods categories owned
0.01
0.01
(0.09)
(0.09)
Number of non-durable goods categories owned
10.87
11.00
(3.58)
(3.55)
Panel E: Food Security
Household diet diversity score (out of 12)
2.77
3.04
(1.82)
(1.67)
Number of meals in last day (household
1.27
1.29
(0.58)
(0.47)
Number of meals eaten in last day (children)
1.29
1.29
(0.59)
(0.49)
Suffered from food insecurity since last harvest
0.99
0.99
(0.09)
(0.09)
Months of adequate food provisioning
1.57
1.86
(1.23)
(1.16)
Number of observations
133
120
Well-balanced
Jenny C. Aker Cash and Vouchers in DRC
p-value
0.345
0.885
0.678
0.863
0.284
0.821
0.834
0.453
0.204
0.908
0.885
0.838
0.042**
253

30. Empirical Strategy
'
yi = g + acash + Xi0 l + q N + ei
• yi is outcome of household i (uses of the transfer, quantities
purchased, food security and asset ownership)
• cashi is the treatment status indicator of household i
• Xi0 is vector of baseline covariates
• θN is neighborhood fixed effects (level of stratification)
• εi individual shocks or ability
• Use pooled data (November and March) and control for round
fixed effects
• Also control for baseline outcome variable as a robustness
check (MacKenzie 2012)
• Main threats to identification: Attrition, spillovers, multiple
hypothesis-testing
Jenny C. Aker Cash and Vouchers in DRC
30

31. Are Transfers Infra- or Extra-Marginal?
• Quantity of goods purchased by cash transfer
households as compared with voucher households:
Identifies whether transfer is infra- or extra-marginal
• Quantity of goods purchased versus consumed for
voucher households: Identifies whether transfer is
binding or non-binding
Jenny C. Aker Cash and Vouchers in DRC
31

32. Total Food Expenditures
Voucher inframarginal for 50% of
households
2346 FC =
Weekly value of of
Weekly value
voucher: 2400 FC
Voucher
Cdf of weekly household food expenditures:
Cash Transfer Group
Jenny C. Aker Cash and Vouchers in DRC

33. Table 2: Uses of the Transfer
Panel A: Food Items
Number of different purchases made (last transfer)
Staple grains (maize, maize flour)
Other grains (cassava flour, rice)
Extramarginality for
some food
items
Stronger
differences for
second and
third transfers
Beans
Condiments
Oil
Meat
Vegetables
Salt
Fish
Panel B: Agricultural Items
Livestock
Seeds
Panel C: Other Non-Food Items
Clothing
Housing Materials
Panel D: Education and Health Expenditures
School fees
Medicines
Reimburse debts
Observations
All Transfers
(1)
(2)
Voucher
Cash
Mean (s.d.)
Coeff(s.e.)
4.94
3.07***
(2.75)
(0.33)
Third Transfer
(3)
Cash
Coeff(s.e.)
4.03***
(0.45)
0.49
(0.50)
0.73
(0.45)
0.27
(0.45)
0.15
(0.36)
0.56
(0.50)
0.03
(0.18)
0.08
(0.26)
0.93
(0.26)
0.45
(0.50)
0.25***
(0.06)
-0.12**
(0.06)
0.22***
(0.06)
0.27***
(0.05)
0.21***
(0.06)
0.65***
(0.04)
0.36***
(0.05)
-0.12**
(0.05)
-0.02
(0.08)
0.25***
(0.07)
-0.10*
(0.08)
0.38***
(0.07)
0.26***
(0.05)
0.27***
(0.08)
0.55***
(0.06)
0.35***
(0.06)
-0.12**
(0.05)
-0.02
(0.08)
0.09
(0.30)
0.37
(0.48)
0.05
(0.04)
-0.06
(0.06)
0.08**
(0.03)
0.03
(0.05)
0.38
(0.49)
0.232
(0.42)
0.26***
(0.06)
0.15***
-0.06
0.42***
(0.06)
0.11***
(0.03)
0.28
(0.45)
0.01
(0.12)
0.301
(0.46)
0.42***
(0.06)
0.08***
(0.03)
0.31***
(0.06)
308
0.64***
(0.06)
0.05*
(0.03)
0.43***
(0.06)
178

34. Uses of the Transfer (Second)
100.0%
90.0%
80.0%
Cash
Voucher
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%

35. Are Specific Items Extra-Marginal?
• Among food items, salt and rice were more likely to
be purchased by voucher households (for all three
transfers, but stronger for second and third
transfers)
o Fish not statistically significant across all rounds, just
second round
• This gives a sense of the extensive margin of overprovision
• What about intensive margin of over-provision?
Jenny C. Aker Cash and Vouchers in DRC
35

36. Intensive Margin of Overprovision
Table 3: Quantities Demanded of Specific Food Items
(1)
(2)
Voucher
Cash
Mean (s.d.)
Salt (kg)
Coeff(s.e.)
1.77
-0.57***
(0.18)
1.75
-1.41***
(2.52)
Number of observations
(2.64)
(1.40)
Fish (number)
-9.97***
(18.57)
Rice (kg)
12.34
(0.32)
130
130
Jenny C. Aker Cash and Vouchers in DRC

37. Are the Transfers Binding?
• Individual welfare losses associated with overprovision
can be mitigated if the transfer is non-binding
• To measure whether the transfer is binding, we want to
measure the difference between purchases and
consumption for extra-marginal goods
• No data on actual quantities consumed, just whether
consumed
• (Given quantities of fish and salt, we could estimate daily
consumption of these goods between last transfer and
food recall period, assuming transfers were binding)
Jenny C. Aker Cash and Vouchers in DRC

38. Table 5: Food Security
All Transfers
(1)
Voucher
Mean (s.d.)
Panel A: Household Diet Diversity
Household diet diversity (out of 12)
Data were
collected 3
weeks after
each
transfer, so
difficult to
separate
between
resale, storage
or lumpy
consumption
Grains
Tubers
Beans
Vegetables
Fruits
Fats
Eggs
Milk
Meat
Fish
Condiments
Sugar
(2)
Cash
Coeff(s.e.)
Third Transfer
(3)
Cash
Coeff(s.e.)
2.62
(1.91)
0.708
(0.46)
0.736
(0.44)
0.222
(0.42)
0.618
(0.49)
0.041
(0.20)
0.416
(0.49)
0
(0.00)
0
(0.00)
0.06
(0.23)
0.153
(0.36)
0.013
(0.12)
0.298
(0.46)
0.09
(0.19)
-0.02
(0.06)
-0.00
(0.06)
0.02
(0.05)
0.03
(0.06)
-0.01
(0.03)
0.08
(0.06)
0.02
(0.01)
0.00
(0.00)
0.02
(0.03)
0.03
(0.05)
-0.01
(0.02)
-0.04
(0.05)
-0.07
(0.23)
0.02
(0.08)
-0.01
(0.08)
-0.01
(0.07)
-0.01
(0.08)
-0.03
(0.04)
0.02
(0.08)
0.01
(0.01)
0.00
(0.00)
-0.03
(0.03)
0.04
(0.06)
-0.04
(0.03)
-0.02
(0.07)

39. Did the Vouchers lead to Differential
Effects on Well-Being?
• Food security (number of meals per day, number of
months of adequate household food provisioning,
food insecurity since previous harvest)
• Asset ownership and savings (durable and nondurable goods categories)
• Agricultural assets (land, livestock)
• Coping strategies
Jenny C. Aker Cash and Vouchers in DRC

40. Food Security
Table 5: Food Security
All Transfers
Third Transfer
(1)
(2)
(3)
Voucher
Cash
Cash
Mean (s.d.)
Coeff(s.e.)
Coeff(s.e.)
1.41
0.01
-0.03
(0.28)
(0.07)
(0.10)
2.12
-0.26
-0.51
(2.79)
(0.31)
(0.51)
2.06
0.13
0.08
(0.84)
(0.09)
(0.12)
308
178
Panel B: Other Measures of Food Security
Number of meals per day (household)
Number of meals per day (children)
Months of adequate food provisioning
Number of observations
Jenny C. Aker Cash and Vouchers in DRC

41. Income and Asset Ownership
Table 5: Proxy Indicators of Well-Being
All Transfers
(1)
(2)
Voucher
Cash
Mean
(s.d.)
Coeff(s.e.)
Panel A: Income, Expenditures and Savings
Income in the previous week (Congolese Francs)
Amount spent on food in previous week
(Congolese Francs)
Money left from transfer (Congolese Francs)
Amount of money remaining (savings)
Panel B: Assets
Total value of household assets (USD)
Number of durable assets owned
Number of non-durable assets owned
Own poultry
Own rabbits
Third
Transfer
(3)
Cash
Coeff(s.e.)
3,357
(2938.83)
739
(639.74)
834.22
(1,039.19)
2,601
(2371.64)
0.00
(0.00)
0.00
(0.00)
-119
(274.58)
0.09***
(0.03)
1,787**
(704.44)
-336.90
(373.81)
0.07**
(0.03)
1,130**
(513.64)
89.07
(35.20)
0.00
(0.00)
10.62
(7.03)
0.1294
(0.34)
0.0117
(0.11)
-1.15
(4.53)
-0.01
(0.02)
0.33
(0.67)
-0.04
(0.04)
0.02
(0.02)
0.36
(5.09)
0.01
(0.01)
0.44
(0.91)
-0.08
(0.05)
0.04
(0.03)
Jenny C. Aker Cash and Vouchers in DRC

42. Coping Strategies
Table 5: Proxy Indicators of Well-Being
All Transfers
Third Transfer
(1)
(2)
(3)
Voucher
Cash
Cash
Mean (s.d.)
Coeff(s.e.)
Coeff(s.e.)
0.0161
-0.02
-0.01
(0.13)
(0.02)
(0.01)
0.27419
0.03
0.07
(0.45)
(0.06)
(0.08)
0.0161
-0.02
-0.01
(0.13)
(0.02)
(0.02)
308
178
Panel C: Coping Strategies
Sold household goods
Reduced number of meals per day
Took children out of school
Number of observations
Jenny C. Aker Cash and Vouchers in DRC

43. Summary
• Different purchases in both groups – voucher
households purchased more rice, salt and perhaps
fish
 No differential effects on individual food consumption
• Proxy indicators of well-being the same between
the two groups
 However, cash households saved some of their transfer
and reported suffering less from food insecurity
Jenny C. Aker Cash and Vouchers in DRC

44. Mechanisms
• Why did purchases differ between the two groups?
• Vouchers restricted to food fairs for last two transfers
 Voucher households had to purchase items in food fairs on
that day (location and timing of purchases)
 Voucher households would have had to pay transport costs
for many (or heavy) items
• Voucher households had more (less ) bargaining
power vis-à-vis traders – had to pay higher prices
• Women in voucher households had more (less)
bargaining power within the household
Jenny C. Aker Cash and Vouchers in DRC
44

45. Table 7: Mechanisms on Purchases
(1)
Voucher
Mean (s.d.)
Panel A: Location of Purchases
Boutique in camp
Market outside camp
Masisi Center market (20 km from camp)
Nyabiondo market (2 km from camp)
Hospital
Voucher fair
School
Panel B: Timing of Purchases
Spent money in more than one purchase
(2)
Cash
Coeff(s.e.)
0.01
(0.11)
0.02
(0.12)
0.00
(0.00)
0.00
(0.00)
0.00
(0.00)
0.99
(0.12)
0.00
(0.00)
0.00
(0.01)
0.97***
(0.02)
0.45***
(0.08)
0.46***
(0.08)
0.01
(0.01)
-0.99***
(0.01)
0.01
(0.01)
0.013
(0.12)
0.77***
(0.04)
0.94
(0.24)
0.46
(0.50)
0.06
(0.24)
-0.02
(0.03)
-0.03
(0.06)
-0.02
(0.03)
0.79
(0.40)
-0.03
(0.05)
308
Panel C: Intra-Household Decision-Making with Respect to Transfers
Beneficiary responsible for spending all or part of transfer
Husband responsible for spending transfer
No one else responsible for spending transfer
Discussed how to use transfer in advance with other person
Number of observations
Jenny C. Aker Cash and Vouchers in DRC

46. Mechanisms
If something was too heavy, I didn’t buy it…I wanted to
buy two boxes of salt but could only carry one, so I
bought one plus other things.
Voucher program recipient, Masisi camp
Jenny C. Aker Cash and Vouchers in DRC

47. Mechanisms
• Why did consumption not differ between the two
groups?
• Time delay between purchases and consumption
 Storage or lumpy consumption
 Wouldn’t explain lack of difference in salt consumption
• Resale of goods purchased
 Almost all households stated that they purchased the
overprovided goods for resale
• Sharing of goods (and cash) between the two groups
Jenny C. Aker Cash and Vouchers in DRC
47

48. Table 8: Mechanisms on Outcomes
Sharing of
money and
goods
(1)
Voucher
Mean (s.d.)
Panel A: Transfers are Non-Binding
Program recipient shared part of money received
Program recipient shared part of goods purchased
No
differential
effects on
intrahousehold
decisionmaking
0.25
(0.44)
0.46
(0.50)
Panel C: Intra-Household Decision-Making with Respect to Transfers
Husband makes education decisions alone
0.3
(0.46)
Husband makes agriculture decisions alone
0.26
(0.44)
Husband decides whether to share with other households alone
0.16
(0.04)
Husband decides whether/how to save alone
0.31
(0.47)
Ratio of women to men's clothing
2.32
(1.58)
Number of observations
Jenny C. Aker Cash and Vouchers in DRC
(2)
Cash
Coeff(s.e.)
0.11*
(0.06)
-0.15**
(0.06)
0.05
(0.06)
0.05
(0.06)
0.03
(0.06)
0.02
(0.06)
-0.08
(0.40)
308

49. Heterogeneous Effects
• Household size
• Female-headed households
• Baseline food expenditures
49

50. Threats to Identification
•
•
•
•
•
Differential take-up or leakage
Differential shocks
Differential price effects
Spillovers
Multiple hypothesis-testing
Jenny C. Aker Cash and Vouchers in DRC
50

51. Table 9: Alternative Explanations
(1)
(2)
Voucher
Cash
Mean (s.d.)
Coeff(s.e.)
Panel A: Take Up and Leakage
Received transfer
2.98
-0.01
(0.01)
80,825.00
1,142.94
-6042
(717.43)
18,352.54
159.25
(167.97)
(229.52)
0.54
0.07
(0.05)
(0.07)
0.27
0.04
(0.05)
(0.06)
0.08
-0.00
(0.03)
Amount received (second transfer)
(0.00)
(0.03)
Amount received (first two transfers)
-0.00
(0.00)
Number of transfers received
1.00
(0.04)
Panel B: Illness and Death
Affected by conflict
Household member affected by illness
Household member died
Number of observations
308

52. Differential Price Effects
• Impact of cash on vouchers:
 Cash transfers relatively small (total of 474 households and
USD$60,000 over six months, amidst IDP population of
60,000 in the area)
 Purchases occurred in three different markets 15-20 km
apart
 Maximum prices at voucher fair were based upon recent
market prices for the same goods and same market
• Impact of vouchers on cash:
 If vouchers increased prices, consumers could have chosen
other markets closer to the camp
Jenny C. Aker Cash and Vouchers in DRC
52

53. Threats to Identification
• Spillovers
 Spillovers less of an issue for purchasing decisions (as
compared with other outcomes)
 Would be less likely to observe a difference in purchasing
decisions
• Multiple hypothesis-testing
 Bonferroni correction on families of outcomes (Sankoh et al
1997)
 Most differences remain statistically significant for extensive
margin (for cash households) and intensive margin (for
voucher households)
Jenny C. Aker Cash and Vouchers in DRC
53

54. Cost Effectiveness Analysis
• Costs to implementing agency
• Costs to program recipients
Jenny C. Aker Cash and Vouchers in DRC
54

55. Costs per Program Recipient
$16.00
Transfer Fees
Account Opening Costs
$14.00
Voucher printing
Materials (plastic sheeting, sticks)
$12.00
Transport (fuel, lodging)
Staff time
$10.00
$8.00
$6.00
Cost per recipient is US$3 more for the
voucher program
Even if double the number of recipients
per voucher fair, the voucher fair still
US$1 more
$4.00
$2.00
$0.00
Cash
Voucher
Jenny C. Aker Cash and Vouchers in DRC

56. Cost Effectiveness Analysis
• Welfare cost (loss) to voucher recipients due to changes
in purchasing decisions
 Mitigated by the fact that vouchers and goods could be sold
• Similar travel and opportunity costs for each modality
 Both groups had to travel to Masisi Center (3-4 hour walk), but
only voucher recipients had to spend there
• Potentially higher security risks for voucher recipients
 Had to travel and spend on particular days
 Goods purchased were more observable to looters and militia
than cash
 Specifically an issue with gender-based violence in eastern DRC
Jenny C. Aker Cash and Vouchers in DRC

57. Conclusions
• Voucher changed household purchases for some
goods
 Voucher households purchased more salt, fish and rice than
they would have if given cash
 Cash households purchased more diverse food items
(overall), school fees, medicines and debt reimbursement –
not “temptation” goods
• No differential effects on welfare
 Non-binding transfers – could sell goods
• Cash transfers more cost effective
Jenny C. Aker Cash and Vouchers in DRC

58. Conclusions
• If markets can provide necessary goods, cash is a
preferred option from a welfare perspective
 Might be other reasons to provide vouchers
• Environment with high marginal utility of income
• But how much cash and how often?
“If we receive (a large sum) of cash all at once, I will
spend it on silly things…like beer, or beers for my
friends, or cookies for the children….”
Cash and voucher recipients and spouses, Masisi camp
Jenny C. Aker Cash and Vouchers in DRC

59. External Validity
• Variety of voucher and cash-based programs in
conflict and emergency situations
 DRC, Sudan, Niger
• Availability of supplies on local markets and selftargeting important
 Poor and vulnerable populations are easily identified with
IDPs – more difficult among host communities
 Markets were able to provide goods
Jenny C. Aker Cash and Vouchers in DRC