Livelihoods Cost-Effectiveness Brief – Anticipatory Cash
The International Rescue Committee (IRC) implemented an anticipatory action cash-distribution pilot among six agro-pastoralist communities in Northeast Nigeria, focused on reducing the damaging effects of flooding. Prior to the flood season of 2022, the IRC set up an early warning system with local hydrometeorological agencies to trigger pre-flooding cash distribution to resource-constrained communities vulnerable to flooding. The program aimed to improve the adaptive capacities of these communities through improved systems for information sharing about climate risks and severity, and resource access to undertake mitigation measures. Researchers measured the cost-effectiveness of a pre-flooding cash distribution triggered by the early warning system, as compared to traditional post-shock resource disbursement. 1,450 households were randomly assigned to receive pre- or post-shock distributions.
Low cost transfer ratios, in addition to positive impact evaluation results, suggest that the pre-shock modality may be more cost-effective than business-as-usual post-shock transfers. The Anticipatory Cash project cost $695 per household receiving pre-shock cash transfers, which drops to $610 per household without system set-up activities. 71% of total group costs went to the cash grant itself. Similar cost-transfer ratios between pre- and post-shock groups suggest that the anticipatory cash response is just as cost-efficient as the post-shock modality.