Authors : Marina Dodlova, Anna Giolbas, and Jann Lay.

This paper examines the implications of political factors for social policy choices.
Specifically, we explore the link between regime type and adoption of unconditional transfers
versus transfers conditioned on beneficiaries’ investments in human capital. Due to the direct
nature of benefits, unconditional transfers are more likely to be used to buy off opposition and
prevent social unrest. As transfers that are conditioned on education and health pay off only in
a relatively distant future, they are rarely initiated for political motives and rather defined by
interests of long-term development and human capital accumulation. Using the new dataset
on Non-Contributory Social Transfer Programs (NSTP) in developing countries, we find that
transfers are indeed chosen so as to be unconditional under less democratic regimes. There is
some evidence that conditional transfers are more likely to be adopted in democracies. In
particular, democracies tend to increase the number of conditional schemes once any social
transfer program is introduced.

Link to the Paper (last working paper version).

Article Published in the European Journal of Political Economy, volume 50 December 2017, Pages 141-156

Link to the Journal Article