IN-KIND VERSUS CASH TRANSFERS - ASSESSING DISBURSEMENT

One advantage of in-kind transfers is that they can focus assistance o n low-income (eligible) beneficiaries by appearing relatively unattrac tive to high-income (ineligible) individuals. This article attempts to identify the conditions under which an in-kind transfer performs sele ctively. Central to the analysis is the question of whether an in-kind transfer is disbursed in a way that permits resale. In the United Kin gdom recent ''privatization'' schemes have transferred durable consump tion goods to the private sector Such schemes permit in-kind assistanc e to be encashed and create ''perverse'' income redistribution.