This study examines how varying repayment obligations and support sizes influence labour supply, income generation, asset accumulation, savings behaviour, consumption, and women’s economic participation for BRAC’s Ultra-Poor Graduation (UPG) program.
Researchers: Munshi Sulaiman; Atiya Rahman; Sheikh Arman Tamim
Partners: BRAC; Gates Foundation
Timeline: 2023–2026
Status: Ongoing
Contact: arman.tamim@bracu.ac.bd
Context
In 2019, BRAC implemented a redesigned Ultra-Poor Graduation (UPG) model that varied the mix of grants and credit across beneficiary groups. The intervention aimed to tailor capital support according to households’ initial asset levels and repayment capacity. This redesign was motivated by the theory of poverty traps, which suggests that households may require different levels and forms of capital to cross asset thresholds that enable sustained economic growth. While prior evidence has shown that sufficiently large transfers can generate long-term gains, less is known about whether hybrid models combining grants and credit can achieve similar impacts more efficiently. The 2019 randomized rollout offers a unique opportunity to evaluate how alternative capital structures affect long-term economic mobility.
Objective
The objective is to estimate the causal impact of differentiated grant–credit packages on long-term household outcomes. The study examines how varying repayment obligations and support sizes influence labour supply, income generation, asset accumulation, savings behaviour, consumption, and women’s economic participation. It also evaluates the relative cost-effectiveness of alternative capital designs in promoting sustained poverty reduction.
Methodology
The study builds on a 2019 cluster randomized controlled trial (RCT) that experimentally varied the mix of grants and credit across beneficiary groups. Using baseline and follow-up survey data, along with a planned additional survey round, the research will construct a longitudinal panel to assess medium- and long-term impacts. Treatment and control groups will be compared to estimate the causal effects of different capital structures on household economic trajectories. The analysis will exploit randomized variation in repayment obligations and support size to examine how capital design influences labor supply, income, asset accumulation, savings, and consumption over time.
The study builds on a 2019 cluster randomized controlled trial (RCT) that experimentally varied the mix of grants and credit across beneficiary groups. Using baseline and follow-up survey data, along with a planned additional survey round, the research will construct a longitudinal panel to assess medium- and long-term impacts. Treatment and control groups will be compared to estimate causal effects of different capital structures on household economic trajectories. The analysis will exploit randomized variation in repayment obligations and support size to examine how capital design influences labor supply, income, asset accumulation, savings, and consumption over time.
Findings and Recommendations
Forthcoming.
