---

Many of our seminars and public events this year will continue as in person or as hybrid (online and in person) events.

Please check our website listings and Twitter feed @STICERD_LSE for updates.

Unless otherwise specified, in-person seminars are open to the public. Please ensure you have informed the event contact as early as possible.

Those unable to join the seminars in-person are welcome to participate via zoom if the event is hybrid.

---

About this event

Large-scale anti-poverty programs can generate persistent demand shocks whose broader effects depend on how local markets adjust. We study these equilibrium responses using a partial population experiment across 88 villages in rural Pakistan, combining randomized transfers to poor households with data on the veterinarians serving them. Four years after the intervention, moving from zero to full treatment exposure increases the number of farmers served by 131% and animals treated by 115%. This increase in demand is accommodated primarily through the expansion of incumbent firms rather than entry: veterinarians broaden service provision and increase employment. Despite the large demand shock, average prices fall substantially, with no overall impact on revenues. These supply responses generate a pecuniary externality by lowering equilibrium prices in a complementary market, extending program gains to households that received no transfer. Pre-existing competition attenuates both the demand captured by individual firms and their subsequent supply response, suggesting that market structure shapes how aggregate demand shocks are transmitted to individual firms. Our findings show that firm responses are an important channel through which targeted interventions affect households beyond their direct beneficiaries.