Do Public Program Benefits Crowd Out Private Transfers in Developing Countries? An Overview of Evidence from Social Protection Policies

Plamen Nikolov and Matthew Bonci ()
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Matthew Bonci: University of Pennsylvania

No 154, IZA Policy Papers from Institute of Labor Economics (IZA)

Abstract: Precipitated by rapid globalization, rising inequality, population growth, and longevity gains, social protection programs have been on the rise in developing countries in the last three decades. However, the introduction of public benefits could displace informal mechanisms for risk-protection, which are especially prevalent in developing countries. In this paper, we critically survey the recent empirical literature on crowd-out effects in response to public policies, specifically in the context of developing countries. We review and synthesize patterns from the behavioral response to various types of social protection programs. Furthermore, we specifically examine for heterogeneous treatment effects by important socioeconomic characteristics. We conclude by drawing on lessons from our synthesis of studies.

Keywords: life cycle; social protection; pension; inter vivos transfers; middle-income and low-income countries; developing countries; crowd-out effect (search for similar items in EconPapers)
JEL-codes: D64 H31 H55 J14 J22 J26 O15 O16 R2 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2020-04
New Economics Papers: this item is included in nep-age, nep-dev, nep-ore and nep-pbe
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Citations: View citations in EconPapers (7)

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