This thesis assesses how a large safety-net programme in rural Ethiopia affects local
labour markets. Combining repeated cross-sections of the National Labour Force
Survey with information on the geographical targeting of the programme, a differencein-
differences approach is used to estimate whether employment outcomes have changed
differently over time in targeted districts relative to those that did not receive the programme.
The results suggest that a combination of public works employment and unconditional
transfers to food-insecure households does not affect the local labour supply
in this rural economy. I explore whether differential trends and population composition
could explain these results, which are more likely due to programme design. Albeit
scantily observed, the wages of private sector labourers also seem unaffected, in contrast
to findings from similar studies focusing on labour markets from other developing
countries outside Africa.</p
