Unconditional Cash Transfers: Do They Impact Aspirations of the Poor?

Abstract Unconditional cash transfers are the key social protection strategy in low- and middle-income countries. However, the amount of unconditional cash transfers is too small to pull the poor out of poverty cycle, yet if they positively affect their aspirations – desire to achieve something – it can have a long run impact. In this paper, I employ propensity score weighting and regression adjustment, to examine the impact of unconditional cash transfers (Benazir Income Support Program (BISP)) on aspirations of the adults in Pakistan. Using Pakistan Rural Household Panel Survey 2012-2013, I construct the aspirations index by weighting and aggregating on three dimensions; income, assets and social status. I find BISP cash transfers to increase aspirations if adults, yet it has differential impact based on gender and income quartile of the household.