‘We Are All Poor Here’: Economic Difference, Social Divisiveness and Targeting Cash Transfers in Sub-Saharan Africa

Abstract

While the central thrust of Michael Lipton's work has been the crucial role of productivity gains in small farm agriculture for rural poverty reduction, in many sub-Saharan African countries this desirable outcome has stubbornly refused to materialise, and growing numbers of rural poor people are found persistently to fail to secure even minimal acceptable levels of food consumption. A social protection policy response is to target social cash transfers to the chronic extreme poor. This article focuses on the level of cash transfers relative to income differences between households in the bottom half of the income distribution, and the social tensions that arise from beneficiary selection and exclusion. It is found that cash transfers to target groups such as ‘the poorest 10 per cent’ or the ‘ultra-poor labour constrained’ must be set low, even below the welfare levels they seek to achieve, if they are to avoid socially invidious reshuffling of the income distribution. The article identifies critical trade-offs between the cost and coverage of different types of social transfer, their social acceptability and their political traction, helping to explain the reluctance of governments to adopt scaled-up poverty-targeted transfers as the preferred form of social cash transfer to those most in need in their societies.

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