The Impact Of Cash Transfer On School Enrollment

Abstract: This paper presents evidence about the impact on school enrollment of a program in Ecuador that gives cash transfers to the 40 percent poorest families. The evaluation design consists of a randomized experiment for families around the first quintile of the poverty index and of a regression discontinuity design for families around the second quintile of this index, which is the program's eligibility threshold. This allows us to compare results from two different credible identification methods, and to investigate whether the impact varies with families' poverty level. Around the first quintile of the poverty index the impact is positive while it is equal to zero around the second quintile. This suggests that for the poorest families the program lifts a credit constraint while this is not the case for families close to the eligibility threshold.

"The impact of cash transfer programs on the accumulation of human capital is a topic of great policy importance. An attendant question is whether program effects are larger when transfers are "conditioned" on certain behaviors, such as a requirement that households enroll their children in school. This paper uses a randomized study design to analyze the impact of the Bono de Desarrollo Humano (BDH), a cash transfer program, on enrollment and child work among poor children in Ecuador. There are two main results. First, the BDH program had a large, positive impact on school enrollment, about 10 percentage points, and a large, negative impact on child work, about 17 percentage points. Second, the fact that some households believed that there was a school enrollment requirement attached to the transfers, even though such a requirement was never enforced or monitored in Ecuador, helps explain the magnitude of program effects.."--World Bank web site.

The impact of cash transfer programs on the accumulation of human capital is a topic of great policy importance. An attendant question is whether program effects are larger when transfers are quot;conditionedquot; on certain behaviors, such as a requirement that households enroll their children in school. This paper uses a randomized study design to analyze the impact of the Bono de Desarrollo Humano (BDH), a cash transfer program, on enrollment and child work among poor children in Ecuador. There are two main results. First, the BDH program had a large, positive impact on school enrollment, about 10 percentage points, and a large, negative impact on child work, about 17 percentage points. Second, the fact that some households believed that there was a school enrollment requirement attached to the transfers, even though such a requirement was never enforced or monitored in Ecuador, helps explain the magnitude of program effects.

We evaluate multiple variants of a commonly used intervention to boost education in developing countries -- the conditional cash transfer (CCT) -- with a student level randomization that allows us to generate intra-family and peer-network variation. We test three treatments: a basic CCT treatment based on school attendance, a savings treatment that postpones a bulk of the cash transfer due to good attendance to just before children have to reenroll, and a tertiary treatment where some of the transfers are conditional on students' graduation and tertiary enrollment rather than attendance. On average, the combined incentives increase attendance, pass rates, enrollment, graduation rates, and matriculation to tertiary institutions. Changing the timing of the payments does not change attendance rates relative to the basic treatment but does significantly increase enrollment rates at both the secondary and tertiary levels. Incentives for graduation and matriculation are particularly effective, increasing attendance and enrollment at secondary and tertiary levels more than the basic treatment. We find some evidence that the subsidies can cause a reallocation of responsibilities within the household. Siblings (particularly sisters) of treated students work more and attend school less than students in families that received no treatment. We also find that indirect peer influences are relatively strong in attendance decisions with the average magnitude similar to that of the direct effect.

A growing body of evidence suggests that conditional cash transfer (CCT) programs can have strong, positive effects on a range of welfare indicators for poor households in developing countries. However, there is little evidence about how important each component of these programs is towards achieving these outcomes. This paper contributes to filling this gap by explicitly testing the importance of conditionality on one specific outcome related to human capital formation, school enrollment, using data collected during the evaluation of Mexico's PROGRESA CCT program. We exploit the fact that some PROGRESA beneficiaries who received transfers did not receive the forms needed to monitor the attendance of their children at school. We use a variety of techniques, including propensity score matching, to show that the absence of these forms reduced the likelihood that children attended school with this effect most pronounced when children are transitioning to lower secondary school. We provide substantial evidence that these findings are not driven by unobservable characteristics of households or localities.

Conditional Cash Transfer (CCT) programs aim to reduce poverty by making welfare programs conditional upon the receivers' actions. That is, the government only transfers the money to persons who meet certain criteria. These criteria may include enrolling children into public schools, getting regular check-ups at the doctor's office, receiving vaccinations, or the like. They have been hailed as a way of reducing inequality and helping households break out of a vicious cycle whereby poverty is transmitted from one generation to another. Do these and other claims make sense? Are they supported by the available empirical evidence? This volume seeks to answer these and other related questions. Specifically, it lays out a conceptual framework for thinking about the economic rationale for CCTs; it reviews the very rich evidence that has accumulated on CCTs; it discusses how the conceptual framework and the evidence on impacts should inform the design of CCT programs in practice; and it discusses how CCTs fit in the context of broader social policies. The authors show that there is considerable evidence that CCTs have improved the lives of poor people and argue that conditional cash transfers have been an effective way of redistributing income to the poor. They also recognize that even the best-designed and managed CCT cannot fulfill all of the needs of a comprehensive social protection system. They therefore need to be complemented with other interventions, such as workfare or employment programs, and social pensions.

Instead of mean-tested conditional cash transfer (CCT) programs, some countries have implemented gender-targeted CCTs to explicitly address intra-household disparities in human capital investments. This study focuses on addressing the direct impact of a female school stipend program in Punjab, Pakistan: Did the intervention increase female enrollment in public schools? To address this question, the authors draw on data from the provincial school censuses of 2003 and 2005. They estimate the net growth in female enrollments in grades 6-8 in stipend eligible schools. Impact evaluation analysis, including difference-and-difference (DD), triple differencing (DDD), and regression-discontinuity design (RDD) indicate a modest but statistically significant impact of the intervention. The preferred estimator derived from a combination of DDD and RDD empirical strategies suggests that the average program impact between 2003 and 2005 was an increase of six female students per school in terms of absolute change and an increase of 9 percent in female enrollment in terms of relative change. A triangulation effort is also undertaken using two rounds of a nationally representative household survey before and after the intervention. Even though the surveys are not representative at the subprovincial level, the results corroborate evidence of the impact using school census data.