Social protection investments, human capital, and income growth: Simulating the returns to social cash transfers in Uganda

Stephan Dietrich, Daniele Malerba, Armando Barrientos, Franziska Gassmann, Pierre Mohnen, Nyasha Tirivayi, Susan Kavuma & Fred Matovu

#2017-029

In this paper we assess the short- and mid-term effects of two cash transfer programmes in Uganda in terms of child underweight, school attainment, and the monetary returns to these indirect effects. Using a micro-simulation approach we test how the scale-up of these pilot interventions could affect human capital indicators and income growth. We first use panel data to estimate the links between income, child health, and school attainment. Thereafter we insert the estimates in a micro-simulation model to predict how cash transfer programmes could generate income returns through higher education attainment and compare programmes in terms of their rates of return.

Keywords: Cash Transfer, Uganda, Education, Child Health, Simulation

JEL Classification: I25, I26, I15, H54, O15