Matthew Grant Wai-Poi

Self-Targeting: Evidence from a Field Experiment in Indonesia

This paper shows that adding a small application cost to a transfer program can substantially improve targeting through self-selection. Our village-level experiment in Indonesia finds that requiring beneficiaries to apply for benefits results in substantially poorer beneficiaries than automatic enrollment using the same asset test. Marginally increasing application costs on an experimental basis does not further improve targeting. Estimating a model of the application decision implies that the results are largely driven by the nonpoor, who make up the bulk of the population, forecasting that they are unlikely to pass the asset test and therefore not bothering to apply.

Does Elite Capture Matter? Local Elites and Targeted Welfare Programs in Indonesia

This paper investigates the impact of elite capture on the allocation of targeted government welfare programs in Indonesia, using both a high-stakes field experiment that varied the extent of elite influence and non-experimental data on a variety of existing government transfer programs. Conditional on their consumption level, there is little evidence that village elites and their relatives are more likely to receive aid programs than non-elites. Looking more closely, however, we find that this overall result masks a difference between different types of elites: those holding formal leadership positions are more likely to receive benefits, while informal leaders are actually less likely to. We show that capture by formal elites occurs during the distribution of benefits under the programs, and not during the processes when the beneficiary lists are determined by the central government. However, while elite capture exists, the welfare losses it creates appear quite small: since formal elites and their relatives are only 9 percent richer than non-elites, are at most about 8 percentage points more likely to receive benefits than non-elites, and represent at most 15 percent of the population, eliminating elite capture entirely would improve the welfare gains from these programs by less than one percent.

Positive returns: cost-benefit analysis of a stunting intervention in Indonesia

Would investing to reduce stunting reap economic benefits that outweigh costs? We investigate this question by conducting a cost-benefit analysis for a large-scale integrated nutrition programme to reduce stunting in Indonesia, using actual rather than stylised data on costs. The gains are assumed to accrue from productivity enhancement from reduced malnutrition, productive earnings from deaths averted and household savings from diarrhoea costs avoided. The programme extends to six provinces over 5 years covering seven cohorts. Using a discount rate of 5 per cent, the benefit–cost ratio is 2.08. The study finds positive net benefits through the productivity impact of lower malnutrition even with sensitivity analysis that excludes the benefits of mortality reduction.