The effects of the Indonesian conditional cash transfer program on transition out of agriculture

Efi Yuliani and Rus'an Nasrudin

World Development, 2024, vol. 173, issue C

Abstract: This study evaluates the effect of a conditional cash transfer (CCT) on the structural transformation process in a developing economy. It uses randomized control trial (RCT) data from Indonesia’s Conditional Cash Transfer program, the Family Hope Program (PKH), to examine whether the PKH program has a significant impact on whether or not agricultural households have moved to other sectors after six years of implementation of the program. The estimates reveal modest impacts of the PKH program on diversification of livelihoods outside agriculture. The treatment group has a 28 percent higher participation in nonfarm wage employment and a 23 percent higher rate of employment in a nonfarm enterprise (NFE) compared to the control group. The heterogeneous impact analysis reveals that distance from a market is a major factor in determining the type of non-agricultural employment. Individuals in households with only a small amount of land who reside near a market are more likely to be casual workers, while individuals in households with only a small amount of land who reside far from a market are more likely to have an NFE. Interestingly, participation in a CCT program has larger effects on households residing in nonindustrial areas than in industrial areas, in terms of both nonfarm wage employment and employment in a nonfarm enterprise.

Keywords: Conditional cash transfer; Agricultural households; Structural transformation (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0305750X23002437
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:173:y:2024:i:c:s0305750x23002437

DOI: 10.1016/j.worlddev.2023.106425

Access Statistics for this article

World Development is currently edited by O. T. Coomes

More articles in World Development from Elsevier
Bibliographic data for series maintained by Catherine Liu ().