Subsidies Vs. Cash Transfers? Nonlinear Paths of Welfare Reform and Counter-Conducts
Language: English and French
Food and energy subsidies are welfare policies designed to keep commodity prices low for consumers. For several decades, international organizations and donors have criticized these subsidies as unsustainable, inefficient, and regressive. They have been targeted by structural adjustment programs since the 1980s and by many IMF loans with preconditions. Meanwhile, targeted cash transfer (TCT) programs have been promoted as a "best practice" and a more cost-effective alternative to consumer subsidies. Originating in Mexico in 1997 with Progresa, TCT programs expanded globally across Asia, Africa, and recently the Middle East.
However, a 2018 World Bank study estimated that food subsidies remained the most widespread form of assistance in low- and middle-income countries. Similarly, fossil fuel subsidies have continued to increase globally. Conversely, Mexico’s flagship TCT program was replaced in 2019 by universal pensions, and the government increased energy subsidies and reintroduced food subsidies for basic foodstuffs.
This session critically examines the global push for welfare reform from subsidies to cash transfers, focusing on the various ways this push is being resisted or inflected. How can we explain the persistence of subsidies and the failure/removal of TCT programs? Rather than seeking rational choice explanations, we welcome papers exploring the non-linear paths of reforms, showing how they integrate into historical settings of intertwined social and economic policies and power relationships between various actors. To what extent do experts, decision-makers, and bureaucrats reproduce or modify these programs? What ‘counter-conducts’ emerge along the subsidies’ supply chains or among actors of the TCTs?