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

Very poor households usually depend on transfers from their social networks for usage smoothing, nevertheless there is restricted evidence on how antipoverty programs have an impact on casual transfers. This paper exploits the randomized rollout of BRAC’s ultra-inadequate graduation program in Bangladesh and panel knowledge masking in excess of 21,000 households in excess of 7 yrs to review the program’s results on interhousehold transfers. The program crowds out casual transfers acquired by the qualified households, but this is driven generally by exterior-village transfers. Treated ultra-inadequate households develop into far more possible to both give and obtain transfers to/from wealthier households within just their village and considerably less possible to obtain transfers from their businesses. As a consequence, the reciprocity of their within just-village transfers boosts. The conclusions suggest that, within just rural communities, there is optimistic assortative matching by socio-economic status. A reduction in poverty enables households to have interaction far more in reciprocal transfer arrangements and lowers the interlinkage of their labor with casual insurance policy.