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Behavioural science applied to Human development focused cash transfer

Implementation of the nudge with beneficiaries

Cash transfers, recognized as one of the most effective tools in social protection, are expanding rapidly into the world’s poorest economies. As these programs support more of the world’s most vulnerable populations, they face growing demands to increase their effectiveness. Light touch interventions from behavioral science help make programs more adaptive to the psychological phenomena that influence beneficiaries’ decisions and actions and improve outcomes at little additional cost.

Innovation Summary

Innovation Overview

In 2016, to alleviate poverty and enhance children’s education, the Government of Madagascar (GOM), through the Ministry of population, started the Human Development Cash Transfer (HDCT) program in partnership with the World Bank (WB) and UNICEF and implemented by the ‘Fonds d’intervention pour le Développement’ (FID) in areas with low human development indicators, The cash transfer, conditional on school attendance for parents of school-age children and unconditional otherwise, is set at around 30% of beneficiaries’ regular consumption and paid directly to the women of qualified households. To strengthen child development outcomes, “Mother Leaders” (MLs), beneficiaries who are elected and trained, provide child focused goods and services, an approach often used when supply-side services in health, nutrition and/or education are in limited supply or of poor quality.

While explicit conditionality remains the default option for many programs seeking to improve health or education outcomes, the recognition that unconditional transfers can approximate impacts of conditional transfers at much lower cost coupled with the administrative and supply side constraints required to monitor the conditionality, has led both practitioners and researchers to explore alternatives and complements to “hard” conditionality. This is of particular importance in the case of programs focused on early childhood development, where the critical behaviors (e.g., balanced and nutritious feeding, breastfeeding, or stimulation to promote socio-cognitive growth, etc.) are private, ongoing and hard to measure in a way that is conducive to the use of classic conditionality, and where investments in children’s human capital often depend more on parents’ behavior and less on access to supply side services.

Research in behavioral sciences suggests that information alone may not be enough to change behaviors and that there are a variety of ‘behavioral’ influences on decision-making that have been shown to complicate the traditional models of decision-making and action-taking. Small features of beneficiaries’ social or institutional context may activate typical features of human decision–making such as limited self control, attention, etc. in ways that may reduce the likelihood of beneficiaries taking the kinds of decisions and actions the program is set up to generate, even when beneficiaries can afford to take these steps and are intrinsically motivated to do so.

In the case of the program beneficiaries, there may be more of a focus on immediate rather than the longer-term, future-oriented behaviors and outcomes. Cash transfers relieve some of the effects of scarcity by supplying money and freeing up a person’s attention for other tasks. This creates a brief window when it is easier to make and act on long-term decisions and goals. However, behavioral interventions are necessary to explore this window of opportunity.

Thus, ideas42 adopted an innovative behavioral science approach to take advantage of the momentary ‘cognitive space’ created by the cash and help the beneficiaries to make the most of their money, and in this manner help the Malagasy Government to achieve greater cost-efficiency of the program. After undergoing a context-driven process to identify the drivers of decision-making for the beneficiaries of HDCT, ideas42 was able to identify two main barriers to preferences-aligned allocation decisions and actions: the inability to plan on the use of cash received and the negative beneficiary “mindsets”. While beneficiaries tended to have clear goals regarding children and their futures, they could not plan realistic actions to achieve their goals. Those who have a plan experienced difficulty executing it. They were more focused on routine needs that the transfer could support than forward-thinking investments. Further, the location of the payment sites, close to the local market, reduced the ability to plan and increased the potential for temptation spending.

These findings led to the designing of two innovative light touch interventions or ‘nudges’: plan-making to link the transfer to goals and self-affirmation. The plan-making enables women who receive cash to adopt a longer-term perspective with concrete goals. They are supported in drawing out the intermediary steps of achieving their goals and in identifying concrete risk mitigation strategy to help them reach them. The self-affirmation enables them to define what they want, to make decisions about the wellbeing of the family, and reinforce their identity as guardians and the power they have to improve their children’s lives. The nudges reinforce women confidence that they can have a positive influence on their family’s happiness.
While ideas42 implement the nudges, steps are taken to transmit behavioral skills and knowledge to the Ministry of population and FID to take the lead on the program behavioral interventions in the future.

Innovation Description

What Makes Your Project Innovative?

In low-income countries considering cash transfer programs to address extreme poverty, finding solutions to cost-effectively facilitate desired behaviors and outcomes among beneficiaries has emerged as a key policy priority. The application of insights from behavioral science—the study of how people make decisions and take actions in the real world—has already revolutionized the design of products, policies and programs addressing an array of development goals around the world. In the realm of cash transfer programs, behavioral science is a promising yet underutilized approach to helping beneficiaries make the most of their money and achieving greater cost-efficiency for governments. Other countries and development practitioners can use the results and lessons from this work to develop or strengthen beneficiaries’ financial outcomes in their own programs.

What is the current status of your innovation?

39,000 households benefit from HDCT with payments made to the female head of the household with 97,000 children under 12 years in 7 districts. HDCT contains a package consisting of a cash transfer and two categories of enhancements:

1) “Mother Leaders”, beneficiaries elected by their peers to lead a group of other beneficiaries in their home village and serve in several ancillary capacities at the community level, and
2) “Nudges” (separate self-affirmation and plan-making activities) to facilitate caregivers’ actions to promote their young children’s physical health, and cognitive and non-cognitive skills.

To estimate of the impact of each component, a randomized controlled trial is underway. A baseline analysis was done in 2016 followed by the midline data collection and analysis, which took place in 2018. End-line data collection is scheduled for 2020. Based on the result from the midline analysis, the GOM has already put forward plans to scale the interventions nationally.

Innovation Development

Collaborations & Partnerships

Government of Madagascar: main program owner, ensuring the leadership, coordination and monitoring of the HDCT program.

World Bank: providing financial and technical support and coordination.

FID: implementing agency; key partner in the research and design process for the behavioral intervention; assists in the implementation of the nudges.

Ideas42: Non-profit organization specialized in behavioral science, designed and implements the behavioral intervention of the program.

Users, Stakeholders & Beneficiaries

FID: as the long-run facilitator of the implementation of the nudges, has now taken a step further towards the adoption of behavioral science in their programming policy.

Mother leaders and beneficiaries are the users of the nudges. The interventions enable them to make the most of their money and work towards their long-term goals.

Innovation Reflections

Results, Outcomes & Impacts

A key goal of our study was to evaluate whether the effects of the three intervention arms (the Mother Leader program and its accompanying “Planning” and “Self-Affirmation” ‘nudge’ variants) on the outcomes of interest were distinguishable from the effects of cash alone.

We group indicators into three broad ‘domains’ (livelihoods & financial health / education / child development) and further classify indicators within each domain into ‘time frames’ (behaviors / intermediate outcomes or outputs / longer-term outcomes). In livelihoods & financial health, the behaviorally enhanced arms, led to significant additional effects on households repaying loans and on other components of income. In education, most enhanced variants see impacts on grade advancement, particularly for primary school age children. In child development, one or more of the enhanced arms have significant impacts on parenting, diverse food expenditure and meal preparation.

Challenges and Failures

The next round of innovation will be centered around building the capacity of MLs, who are currently accompanied by an external party during their sessions, to deliver the nudges independently. MLs are well-positioned to take an influential leadership role in their communities but have been found to struggle with the facilitation of some of the current content of the program. The next iteration of the intervention will be to simplify the facilitation of the nudges to allow MLs to implement them independently while still achieving the same level of impact and decreasing costs.

A new version of the nudges was developed after the midline to see if combining the two, self-affirmation and plan-making, could capitalize on the strengths of each. Lastly, various measures are now being put in place to ensure that partners involved in the program are well-equipped to incorporate behavioral science broadly into their policies and programs.

Conditions for Success

Collaborating with partners who are motivated to use cutting-edge research to improve the outcomes of the cash transfers programs is a large contributor to success. The Malagasy Government’s coordination and the FID’s contribution in designing and implementing the nudges are essential to the whole process. Secondly, working with partners who are willing to provide access to necessary data, staff and beneficiaries to inform the research and design process is also key. Lastly, a willingness to rigorously test for the outcomes of the interventions allows partners to respond to results and make necessary modifications and smooth out any implementation obstacles.


In Madagascar, the partners of the Human Development Cash Transfer (HDCT) program have identified an opportunity to apply behavioral insights to the new Intensified Early Childhood Development program to be tested in new localities of the HDCT program. Initial discussions led ideas42 and the partners of the program to focus the new behavioral interventions on enhancing the Mother Leaders’ ability to fulfill their role, boosting group decision-making among the beneficiaries and assisting the parents to apply what they learn on intensified early childhood development on their children.

In addition to that, following the first findings from the implementation of the nudges in Madagascar, ideas42 has designed behavioral interventions for other cash transfer programs in Kenya and Tanzania, which have also produced positive results from pilot testing. ideas42 currently has plans to conduct testing of similar interventions in several new countries across Sub-Saharan Africa during 2020-2022

Lessons Learned

1. Behavioral science insights increase the impact of cash transfers at little additional cost: At a cost of less than 7 USD per beneficiary per year, the results make a strong policy argument for scaling behavioral science in cash transfer programs focused on poverty alleviation.

2. Iterative testing is an effective way to cost-effectively build evidence for scaling: In Madagascar and the other two countries, pilot testing started with short-term, low-cost tests. These initial shorter tests provided the opportunity to make necessary modifications to the behavioral designs and to smooth out any implementation obstacles prior to launching a full-scale RCT.

3. Innovations should account for limited time and resources: A key challenge for incorporating innovations into any government program is the government’s time and human capacity limitations, given the multitude of priorities that need to be juggled. The development of various tools and resources that facilitate easy application of behavioral science to cash transfer programs will play an important role in enabling behavioral science to be applied broadly on a large scale across the sector.

Anything Else?

Looking forward, we intend to continue testing the long-term effects of behavioral design in cash transfer programs and encourage governments to incorporate behavioral principles into the design
of cash assistance programs to begin building better environments that create clearer paths out of poverty.

Supporting Videos


  • Evaluation - understanding whether the innovative initiative has delivered what was needed

Innovation provided by:



Date Published:

9 November 2021

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