Do public transfers crowd out the effects of remittances? Social protection, and entrepreneurship in eight communities in West-Africa

Nicolás Caso (), Jason Gagnon and Jessica Hagen-Zanker

Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium from Ghent University, Faculty of Economics and Business Administration

Abstract: Remittances and social protection programmes have become two of the most important sources of financial support for households across low- and middle-income countries. While both have been linked to household investment and livelihood diversification, little is known about how they jointly influence entrepreneurship. This paper examines whether public transfers, in the form of cash transfers and school feeding support, crowd out or in household entrepreneurship and whether private transfers, in the form of remittances, complement or substitute for public transfers in shaping entrepreneurship. Using household survey data from eight communities in West Africa, we analyse the relationship between social protection, remittances and a range of entrepreneurial outcomes. The results provide little evidence that social protection systematically influences household entrepreneurship or alters the relationship between remittances and business activity. In contrast, remittances remain consistently associated with business creation and entrepreneurial intentions across multiple contexts. These findings suggest that expanding social protection does not diminish the productive role of remittances and highlight the importance of considering public and private sources of household support jointly when assessing policies aimed at promoting entrepreneurship and inclusive economic development.

JEL-codes: F24 H53 I38 L26 O12 (search for similar items in EconPapers)
Pages: 65 pages
Date: 2026-10
New Economics Papers: this item is included in nep-afr, nep-dev, nep-ent, nep-fdg, nep-pke and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:rug:rugwps:26/1152

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