The impact of social protection on poverty through normal times and times of crisis: evidence from Ghana, Mozambique, Tanzania, Uganda, and Zambia

Abstract

We study the effectiveness of social protection benefits in reducing income and consumption poverty in five sub-Saharan African countries—Ghana, Mozambique, Tanzania, Uganda, and Zambia—in normal times and times of widespread economic crisis. Using tax–benefit microsimulation models with representative household survey data, we estimate the impact of benefits on poverty in each country. We then study the ability of benefit automatic stabilizers to reduce losses in incomes and consumption in times of crisis by simulating hypothetical reductions to earnings and employment. We show that the poverty-reducing impact of benefits in all five countries is low in normal times. The effectiveness of benefits to stabilize income and consumption and offset poverty increase in times of crisis is also limited because many benefits are linked to proxies of income, not income itself, or have tight eligibility criteria.