In-Kind Versus Cash Transfert: Assessing Disbursement

Abstract

Abstract One advantage of in-kind transfers is that they can focus assistance on low-income(eligible) beneficiaries by appearing relatively unattractive to high-income (ineligi ble) individuals. This article attempts to identify the conditions under which an in-kind transfer performs selectively. Central to the analysis is the question of whether an in-kind transfer is disbursed in a way that permits resale. In the United Kingdom, recent "privatization" schemes have transferred durable consumption goods to the private sector. Such schemes permit in-kind assistance to be encashed and create "perverse" income redistribution.