Effects of Unconditional Cash Transfers on Asset Accumulation Among Low‐Income Households in Rural Northern Uganda

Abstract

ABSTRACT Cash transfers have become an increasingly important social protection tool in development and humanitarian contexts. In developing countries, cash transfers can be used to build economic resilience. This study examines the effects of unconditional cash transfers on asset accumulation among low‐income households in rural Northern Uganda. Using a quasi‐experimental design and cross‐sectional survey data, we estimate differences in household asset accumulation between transfer recipients and non‐recipients. Asset accumulation was measured using self‐reported monetary values of land and buildings, livestock, electronics and communication equipment, transport means, furniture, and power sources. Results show substantial positive effects, with an estimated average treatment effect on total asset value of UGX 8,967,195/USD 2315. The largest increases appear in land and buildings and livestock, while smaller but statistically significant increases occur in electronics and communication equipment, transport means, furniture, and power sources. Effects appear stronger among male‐headed households and those with married or cohabiting household heads. The findings suggest that unconditional cash transfers can support asset accumulation and household economic security. We recommend expanding predictable unconditional cash transfers with additional gender‐sensitive support measures. Our findings contribute to the growing but scanty evidence that unconditional cash transfers can have positive effects beyond meeting the immediate consumption needs.