Prof. Hasan Vergil will be presenting a paper on "Risk Perceptions in Social Transfer Programs: Evidence from Turkey" at this week's IHU Economic Seminar Series. The abstract can be found herewith. The seminar to be given by Prof. Hasan Vergil will take place on Friday, November 11, 2022 at 14.00 at Ömer Faruk Harman Hall.
Abstract
The targeted transfer programs have gained popularity in achieving significant poverty reduction. Although targeting mechanisms in social transfers have been successful in identifying the poor, targeting failures are also common. This paper aims to estimate the risk perception differences of poor households in taking up social transfers. To do that, we constructed a theoretical model linking the relationship between risk aversion and money transfers and conducted statistical and econometric analyses using the Income and Living Conditions Survey of Turkey. We found that, under different risk aversion scenarios, while the effect of economy-wide risk on taking up social transfers is the same, idiosyncratic shocks and utility rise have varying effects on participating in social transfers. The results show that high-risk-averse households participate more in social transfer programs. The findings imply a key role of risk perceptions of households in determining social transfer and poverty alleviation policies.
