Productive Workfare? Evidence from Ethiopia’s Productive Safety Net ProgramJules Gazeaud, Victor Stéphane

Productive Workfare? Evidence from Ethiopia’s Productive Safety Net Program
GATE WP 2037 – December 2020

• Jules Gazeaud, NOVA School of Business and Economics
• Victor Stéphane, Groupe d'Analyse et de Théorie Economique (GATE), CNRS, University of Lyon - Groupe d'Analyse et de Théorie Economique (GATE)

Abstract :
Despite the popularity of public works programs in developing countries, there is virtually no evidence on the value of the infrastructure they generate. This paper attempts to start filling this gap in the context of the PSNP – a largescale program implemented in Ethiopia since 2005. Under the program, millions of beneficiaries received social transfers conditional on their participation in activities such as land improvements and soil and water conservation measures. We examine the value of these activities using a satellite-based indicator of agricultural productivity and (reweighted) difference-in-differences estimates. Results show that the program is associated with limited changes in agricultural productivity. The upper bound of the main estimate is equivalent to a 3.6 percent increase in agricultural productivity. This contrasts with existing narratives and calls for more research on the productive effects of public works.

Keywords: Social Protection, Public Works, Transfers, Ethiopia, PSNP

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