Non-contributory social transfer programs in developing countries: A new dataset and research agenda

Abstract

Social transfer programs in developing countries are designed to contribute to poverty reduction by increasing the income of the poor in order to ensure minimal living standards. In addition, social transfers provide a safety net for the vulnerable, who are typically not covered by contributory social security. The question of how effective such programs are in achieving these aims has been the subject of numerous impact evaluations. However, the optimal design of such programs is still unclear. Even less is known about whether the adoption and implementation of transfer programs is really driven by poverty and neediness or whether other factors also have an influence. To investigate these and other research questions, we have developed a new dataset entitled Non-Contributory Social Transfer Programs (NSTP) in Developing Countries. One advantage of this dataset is that it traces 186 non-contributory programs from 101 countries back in time and presents them in panel form for the period up until 2015. The second advantage is that it contains all the details regarding the various programs’ designs as well as information on costs and coverage in a coded format and thus facilitates both comparative quantitative and in-depth qualitative analyses. While describing the data we discuss a number of examples of how the dataset can be used to explore different issues related to social policies in developing countries. We present suggestive evidence that the adoption of social transfer programs is not based only on pro-poor motives, but rather that social policy choices differ between political regimes.

Regime type, inequality, and redistributive transfers in developing countries

“…Empirically, we have used the new Non-Contributory Social Transfer Programmes (NSTP) in Developing Countries Data Set of Dodlova et al (2016), which provides comprehensive and comparable information on non-contributory assistance to the poor. Employing standard panel estimators (pooled OLS and fixed effects), we have found strong evidence that more-democratic countries are more likely to have transfer programmes.…”

“…To test our predictions, we use the new Non-Contributory Social Transfer Programmes (NSTP) in Developing Countries Data Set provided by Dodlova et al (2016). Considering the period of extensive expansion of social transfer policies in developing countries in the period 1990-2015, we find supporting evidence that democracies are more likely to have a social transfer programme.…”

“…The data consists of a yearly and a five-yearly panel of 143 developing countries for the period 1990-2015. The transfer variable was constructed based on the Non-Contributory Social Transfer Programmes (NSTP) in Developing Countries Data Set of Dodlova et al (2016). This database significantly extends and updates information from Barrientos et al (2010).…”

“…It can be assumed that the most prominent and important programmes in developing countries are captured. Since Dodlova et al (2016) focus on non-contributory programmes, the transfer variable reflects progressive redistribution to the poorest.…”

“…Moreover, countries with just one transfer scheme in operation and countries with several are treated the same way; there is only one observation per country and year. Dodlova et al (2016) document a sharp increase in the total number of redistributive transfer programmes in developing countries since 1990. While there were only 19 programmes in 1990, the number climbed to 62 in 2000 and then reached 186 programmes in 2015.…”