Cash Transfer Programme, Productive Activities and Labour Supply: Evidence from a Randomised Experiment in Kenya

Abstract

This paper reports the analysis of the impact of Kenya’s Cash Transfer for Orphans and Vulnerable Children Programme on the household decisions on productive activities using data from a randomised experimental design. Results show that the programme had a positive and significant impact on food consumption coming from home production, accumulation of productive assets, especially on the ownership of small livestock, and on formation of nonfarm enterprise, especially for females. The programme has provided more flexibility to families in terms of labour allocation decisions, particularly for those who are geographically isolated. The programme was also found to reduce child labour, an important objective of the programme. However, we find very little impact of the programme on direct indicators of crop production.