Benefits of Nepal’s Child Grant for current and future generations

This policy brief draws on evidence from Nepal and around the world to show that an enhanced and expanded Child Grant can make a real difference to the lives of children and is a sound investment for the country’s long term social and economic development

A woman receives cash grant
UNICEF Nepal/2015/PMathema


Why invest in children?

The early years are a critical time in a child’s development. Children’s brains develop at a rapid pace in the earliest years, but this slows with age. A lack of development in early life is therefore difficult to make up for in later years. Children exposed to good quality early stimulation have higher schooling outcomes and greater productivity in the job market when they reach adulthood. Childhood malnutrition cuts future earnings by at least 20 per cent, with one study suggesting that this could be as high as 66 per cent (Grantham McGregor, 2007; Hoddinott et al., 2011). The subsequent impact on a country’s economy is huge: malnutrition could decrease GDP by between 2 and 11 percent (World Bank, 2006; WFP & UN-ECLAC, 2007).

Nepal is at a crucial time in its development. Its demographic and health transition – from a high-mortality and high-fertility society to a low-mortality and low-fertility society – means that the children of today will have to be more productive to promote economic growth and to support a rapidly ageing population. Investments in the key areas of health, nutrition, education and social protection are crucial to capitalise on the demographic window of opportunity – the time when the working age population is growing compared with the aged population. Investing in children now will contribute towards a healthier and more educated workforce that is better able to contribute to the country’s economy. Several studies in the United States have found that one dollar invested in early childhood development yields from $4 to $16 for the wider economy (Rolnick, 2014). Investments in children are therefore also a key investment for the country’s future.

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