This research paper discusses the interactions between social protection, rural transformation and inclusiveness. The questions addressed are: How does social protection reach and facilitate the rural transformation process? What key social protection interventions can better support inclusive transformation? Based on country-level evidence, the paper analyses how different types of social protection interventions (protective, preventive or promotional) affect rural livelihoods; help rural transformation (by increasing productivity, employment opportunities or non-farm activities); and influence inclusiveness. Each context could either enhance or jeopardize social protection interventions, affecting their transformational and inclusiveness impacts.

Social protection represents a significant portion of national budgets (on average 3 per cent of national GDP in a subset of developing countries for which data were available). The resources devoted through social protection do not specifically target the rural poor, but provide relevant resources to poor households and communities more widely. Social protection has shifted from providing traditional social assistance (targeting just the poor) to offering a broader set of complex and interlinked interventions in favour of vulnerable social groups.

Although there is not enough evidence available to assess the impact of different combinations of social protection policies and programmes, they can be seen as providing useful tools to help prepare rural populations to take advantage of rural transformation (entry into the non-farm economy, training in specific skills, empowerment of rural populations, protection of the most vulnerable), and to protect groups that could be left behind during such transformation.

Social protection could enhance rural transformation and improve its inclusiveness – but such outcomes will depend on the specific context and the combination of interventions, their characteristics, scale and targeting rules.