Cost-effectiveness through bundled distribution: Impacts of a package of goods on livelihoods in rural Tanzania

Abstract There are a wide variety of development interventions that have been shown to improve welfare of poor, rural households. However, these are frequently delivered piecemeal. Using a randomised controlled trial, we test a new model of aid delivery called the Human Development Fund (HDF) in which a bundle of promising income-generating goods (such as fertilizer and hybrid chickens) and preventative health products (such as insecticide-treated bednets and corn-soy nutritional powder) are given to rural households in Tanzania using a low-cost one-time distribution system. We find large and positive effects of the HDF program on income and household consumption. Profits from maize increased by 170%, contributing a 35% return overall on the cost of the income-generating assets of HDF. Household consumption also increases by 6.1% in the year following the HDF bundle distribution. However, apart from maize inputs, the other income-generating goods (such as hybrid chickens) yielded disappointing results. This calls into question the benefit of a wide bundle in this context, as a tighter focus on maize inputs would likely have been more efficient.