Power of partnership conference: Presentation: Labour markets in village economies: Can one time asset transfers reduce poverty? Evidence from Bangladesh

1. Can one time asset transfers reduce poverty?
Evidence from Bangladesh
Paper Title: Labor markets in Village Economies
Oriana Bandiera, Robin Burgess, Narayan Das, Salim Gulesci, Imran Rasul,
Munshi Sulaiman
Pallavi Prabhakar

2. Ultra-Poor Wealthier class
Poverty Trap ✔ Poverty Trap ✖
40 years of age
Has a 6
years old
child
Works as a domestic maid
Rama Kavita
Often engages in
casual agricultural
wage labor
Owns a goat ($54)
Primary
earner of
the family
Is illiterate
Earns low income
Is below poverty line
Unlikely to migrate
Works 991 hrs/year
Has little or no
savings
Doesn’t own land/ other
assets
40 years of age
Has a 6 years old child
Owns 3 cows ($542)
Primary
earner of the
family
Above poverty line
Owns a house
Works 502 hours
per year Owns the land/ has a mobile phone
Engages in livestock activity
Is literate
Earns better
returns for
livestock
Earns a higher
income
Has savings,
spends more

3. Can Rama come out of poverty trap if she also engages in livestock activities like Kavita?
What are the ways to make Rama better off?
Productive assets
Can only do
casual jobs
Low pay,
low
demand
Better income
Low savings
Can’t afford
assets
No productive assets
Low income
Can do
livestock
rearing
High
returns to
livestock
Improved savings
Investment in
assets
Targeting the Ultra Poor
BRAC
Asset transfer
Skills + Capital
Subsistenceallowance
Training
Creditsupport
Poverty Trap ✔ Poverty Trap ✖

4. Research design + methods
•Randomized roll out across 21,000 households in 1,309 villages
covering 40 BRAC branches
•4 rounds of survey in 2007, 2009, 2011, 2014 covering 6,700 ultra
poor households
•Participatory wealth ranking exercise used before baseline
randomization for ranking households as ultra poor, near poor, middle
class, upper class
•Difference-in-difference specification used to identify the impact of
the Targeting the Ultra Poor (TUP) program on individual and
household level outcomes

5. Impact
0
20
40
60
80
100
120
140
2007-09 2007-11 2007-14
Yearly changes in expenditure on durables after 2,
4 and 7 years (USD)
Treatment Control
0
500
1000
1500
2000
2007-09 2007-11 2007-14
Yearly changes in productive assets after 2, 4 and
7 years (USD)
Treatment Control
-0.1
0
0.1
0.2
0.3
0.4
2007-09 2007-11 2007-14
Yearly changes in share with access to land
after 2, 4 and 7 years
Treatment Control

6. Talking numbers
217% more
hours to
livestock
rearing
11% increase in
per capita
consumption
expenditure
21% higher
earnings
compared
to control
group
17% fewer
hours to
agriculture
labor
26% fewer
hours to
maid
services
54%
increase in
value of
household
durables
82% increase in
value of
landholdings
Value of assets
owned is
159% larger
than control
Agriculture
and maid
wages are
9% and 11%
higher
respectively
22% Internal
rate of return
Average benefit
cost ratio of
3.2 for TUP

7. What do other studies say?

8. References:
Bandiera, O., Burgess, R., Das, N., Gulesci, S., Rasul, I. and Sulaiman, M., 2017.
Labor markets and poverty in village economies. The Quarterly Journal of
Economics, 132(2), pp.811-870
A short video