Programmes need to be better targeted and designed to maximise the social externalities they create for them to be cost-effective
Read “Do workfare programmes live up to their promises? Experimental Evidence from Cote D’Ivoire” by Marianne Bertrand, Bruno Crépon, Alicia Marguerie and Patrick Premand here.
Public works programmes (or ‘workfare’ programmes), in which participants receive a wage for working on the provision of some sort of public good (cleaning roads, building small infrastructure, planting trees, etc.), are one of the most common instruments to provide social assistance in low-income countries. They are also increasing being used as part of employment policy, with the aim of opening up pathways to more productive employment after the programme via additional training on, for example, entrepreneurship or job search.
In this VoxDevTalk, Patrick Premand discusses his work with Marianne Bertrand, Bruno Crépon and Alicia Marguerie evaluating one such programme in Côte d’Ivoire. The programme had only a limited impact on youth employment, but a much stronger impact on the type of work that youths engaged in, with a large increase in the share of youths holding wage jobs and a decrease in the share in self-employment. The programme also led to significant increases in earnings, which in turn led to increased consumption and savings. However, the effects observed 12 months after the programme were much more muted, with participants quickly going back to the same types of employment they had before the programme.
The narrow impact of workfare programmes on individual earnings may not be sufficient for them to be cost-effective. Programmes need to be designed in such a way to maximise the externalities they create in terms of their effects on, for example, social wellbeing, social cohesion or youth engagement in risky behaviour.