Macroeconomic Implications of Social Safety Nets in the Context of Bangladesh

Md Ashiq Iqbal
JEL codes: 
Centre for Policy Dialogue Paper 75

Social safety net is a measure taken by the government in order to prevent the vulnerable section of its population to fall beyond a certain level of poverty. Social safety net
programmes (SSNPs) are designed to provide support for the vulnerable section of the society. With a vision to prevent transmission of poverty from generation to generation, the safety net programmes opt for a more efficient society in terms of the choices made by individuals. The social safety nets play both a redistributive and a productive role supporting moral philosophy as well as managing risks. These two are the major pillars that justify the existence of safety net programmes. It should be mentioned at the outset that the safety net programmes create a path towards poverty reduction in the long run. They do not reduce poverty directly, rather these programmes tend to reduce transitional poverty through ensuring proper nutritional intake, education, health care, etc. In other words, the safety net programmes are methods through which poverty is expected to fall through investment in human capital.