Great Expectations: Responses to Current and Future Transfers for Low-Income Individuals

Achyuta Adhvaryu; Jean-François Gauthier; Pamela Jakiela; Dean Karlan

doi:10.3386/w34857

Great Expectations: Responses to Current and Future Transfers for Low-Income Individuals

Achyuta Adhvaryu, Jean-François Gauthier, Pamela Jakiela & Dean Karlan

Working Paper 34857

DOI 10.3386/w34857

Issue Date February 2026

How does the expectation of aid change behavior? We propose a simple approach to separate expectations effects from the direct effects of relaxing resource constraints: compare the promise of a program to the program itself. We test this approach in a four-arm randomized controlled trial of cash transfers in Uganda. Both those who received cash and those promised-to-receive cash increase their labor supply and investment. Immediate transfers also increase household expenditures and savings. Our results are not consistent with standard life-cycle models; they are better explained by a model in which the transfer increases individual labor productivity.

We thank participants at the University of Michigan, UC Irvine, CIRANO, GiveDirectly, the Center for Global Development, and in particular Sonia Laszlo and Fabian Lange for helpful comments. Registered at the American Economic Association Registry for Randomized Controlled Trials (AEARCTR-0000049). Institutional Review Board approval from the TASO Uganda Research Ethics Committee, the University of Ottawa Ethics Review Board in Canada, and the Innovations for Poverty Advisory (IPA) Review Board. The protocol was also registered at the Ugandan National Council of Science and Technology. We thank the Canadian Institutes of Health Research (CIHR) and in particular Edward Mills for collaboration to make this study possible. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

Achyuta Adhvaryu
I am a co-founder and sit on the board of directors of Good Business Lab, a nonprofit organization dedicated to improving the lives of low-income workers everywhere. I receive no compensation for these roles.
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Achyuta Adhvaryu, Jean-François Gauthier, Pamela Jakiela, and Dean Karlan, "Great Expectations: Responses to Current and Future Transfers for Low-Income Individuals," NBER Working Paper 34857 (2026), https://doi.org/10.3386/w34857.

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Great Expectations: Responses to Current and Future Transfers for Low-Income Individuals

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