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March 26, 2019

Cash transfer programs assist hundreds of millions of poor individuals in developing countries but stimulate local demand that can cause environmental damage. Degradation of the local environment, in turn, affects the well-being of both beneficiaries and non-beneficiaries. The study integrates a bio-economic model of a fishery in the Philippines with a general-equilibrium model of the local economy. It finds that environmental degradation can reduce income benefits of poverty programs. Cash transfer programs in tandem with environmental policies can achieve welfare gains and mitigate environmental damages that in turn economically harm communities.

The article is available here.

Gilliland, Ted E., James N. Sanchirico, and J. Edward Taylor. "An integrated bioeconomic local economy-wide assessment of the environmental impacts of poverty programs." Proceedings of the National Academy of Sciences (2019): 201816093.

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