Do Cash Transfers Change Input-Buying Decisions on Smallholder Farms?

Key findings

• ▸Transfer-receiving households spent 22% more on certified seed relative to the comparison group.
• ▸Fertilizer volume purchases were largely unchanged between groups.
• ▸The spending shift was significantly stronger when transfers were paid directly to the primary farm decision-maker.

Abstract

This study surveyed 340 smallholder households across rural Maharashtra receiving unconditional cash transfers, tracking how transfer receipt changed input-purchase decisions relative to a matched comparison group. Households receiving transfers directly showed a measurable shift in spending priorities — toward higher-quality seed rather than additional fertilizer volume — and this shift was significantly stronger when the transfer was paid directly to the person making day-to-day farming decisions rather than the nominal household head.