The impact of cash transfers on local markets

This report explores the effects of cash transfers on local markets. It tests the hypothesis that ‘cash transfers
to poor households lead to integration of markets in remote areas and strengthen existing well-integrated
market systems’. To test the hypothesis a case study was conducted in Northern Uganda, to assess the
effect of cash transfers on unstructured markets. The Northern Uganda experience represents the
backbone of the report, even if findings have been complemented and enriched with the review of other
experiences and recent literature. A second case study, conducted in Bangladesh, should have supported
the second part of the hypothesis related to well-structured markets. The poor information received from
the Bangladesh study did not permit the study to delveinto this part of the hypothesis. As a consequence,
the few conclusions made on the impact on well-structured market systems are drawn from other studies
and literature reviews.