Impact of productive social safety net on households’ vulnerability to poverty in Tanzania

by Basil Msuha, Luitfred D. Kissoly

Social safety nets are expanding in Sub-Saharan Africa. While proponents perceive them as a means to combat poverty and vulnerability, opponents view them as wasteful use of scarce public resources and do not significantly overcome poverty. Previous studies have primarily focused on assessing the impact of these policies on current poverty levels, with insufficient evidence available regarding their impact on future poverty, which deserves equal attention. We drew on the Tanzanian 2017–18 Household Budget Survey, comprising 9,463 households to evaluate the impact of productive social safety net (PSSN) program on households’ vulnerability to poverty (VP). The VP was evaluated using vulnerability as expected poverty (VEP), whereas the impact was estimated using Instrumental Variable (IV) method. We found that PSSN reduces household VP by 13.4%, suggesting that it is an effective policy instrument for reducing poverty and vulnerability. Notably, the estimated impacts were greater for households enrolled in conditional cash transfer (CCT) and public work (PW) combined, suggesting that a package of CCT and PW is likely to have a more substantial impact within the realm of social safety nets. Our findings offer evidence in favor of policies that promote the broader expansion of social safety nets as anti-poverty policy instruments.