Interhousehold Transfers : Using Research to Inform Policy

Inter-household transfers are an important resource for low-income households, yet have been almost ignored by donors. Though they are no substitute for public programs, these private transfers merit more attention in poverty research, gender analysis, project design, and development strategies. The note provides insight on what drives inter-household transfers - of money, goods, and services - through anthropological, and sociological explanations, but most importantly the inter-generational support, which act as an informal social security system, by which children take care of their parents in old age, or parents provide for their children in emergencies. As well, the note looks into coping strategies for women, and women-headed households, who increasingly bear the brunt of economic crises. This raises a number of questions on policy implications: what net re-distributive effect do public transfers have on health, old age security, on net private flows? Furthermore, can some services be provided more efficiently through private, rather than public transfers? Similarly, other questions address how to reach vulnerable groups - ethnic minorities or women-household heads -effectively through private transfers, and, how can informal private networks, make public sector targeting more effective.