Poverty Alleviation and Interhousehold Transfers: Evidence from BRAC’s Graduation Program in Bangladesh

Inadequate households usually rely on transfers from their social networks for intake smoothing, however there is confined evidence on how antipoverty plans influence casual transfers. This paper exploits the randomized rollout of BRAC’s ultra-weak graduation method in Bangladesh and panel info masking more than 21,000 households more than 7 years to study the program’s results on interhousehold transfers. The method crowds out casual transfers obtained by the targeted households, but this is driven mainly by outside-village transfers. Taken care of ultra-weak households turn into a lot more likely to the two give and receive transfers to/from wealthier households within just their village and considerably less likely to receive transfers from their companies. As a result, the reciprocity of their within just-village transfers improves. The conclusions imply that, within just rural communities, there is optimistic assortative matching by socio-economic status. A reduction in poverty allows households to have interaction a lot more in reciprocal transfer arrangements and lowers the interlinkage of their labor with casual insurance.