Does Anticipatory Cash Transfers Help? Quasi-Experimental Evidence from Somalia

Anticipatory cash transfers, i.e. disbursed before climate shocks materialise rather than after, are expanding rapidly across fragile settings, yet rigorous evidence on their effectiveness in slow-onset drought contexts remains scarce. This study provides one of the first quasi-experimental evaluations of Early Warning-based Anticipatory Cash Transfers (EWACT) targeting a slow-onset drought in a fragile, conflict-affected setting, using three rounds of panel data from 1,635 households in Baidoa district, Somalia (2024–2025) and a difference-in-differences design with inverse probability weighting. Results show that treated households significantly increased savings and crop reserves and improved debt repayment capacity, the intermediary outcomes of the asset-protection, savings, and debt-management pathways, which translated into a 33 percentage-point improvement in food consumption scores and a 7 percentage-point reduction in crop losses at midline. No significant effects on livestock mortality were detected. Effects on mobility and displacement, reveal a reduction in both, with mobility effect that deepens from 5 to 12 percentage points between midline and endline, even as food security gains dissipate. An instrumental variable extension shows that food security benefits are front-loaded and fade with elapsed time since transfer, while financial stock outcomes persist across seasons. This temporal asymmetry, transient food security improvements alongside a strengthening and durable reduction in mobility, is the paper's central empirical contribution, with implications for the design, sequencing, and cost-effectiveness of anticipatory action in fragile, drought-prone contexts. 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri