do conditional cash transfers for schooling generate...
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DoConditionalCashTransfersforSchoolingGenerateLastingBenefits?AFive-YearFollowup ofPROGRESA/OportunidadesTheJournalofHumanResources
JERER. BEHRMAN
SUSANW.PARKER
PETRAE. TODD
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Motivation
- Conditionalcashtransfer(CCT)programslinkpublictransferstohumancapitalinvestmentinhopesofalleviatingcurrentpovertyandreducingitsintergenerationaltransmission.
- PROGRESA/Oportunidades beganoperatinginsmallruralcommunitiesin1997.
- Itexpandedtourbanareasandnowcoversfivemillionfamilies,oraboutonequarterofallfamiliesinMexico.
- Wellover30countriesnowhaveaspartoftheirsocialpolicyCCTprograms,mostofwhichincludesubstantialschoolingconditionalities.
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Motivation
- Littleisknownaboutthelonger-termimpactsofCCTsonschoolingattainmentorotheroutcomes,despitetherapidspreadoftheseprograms.
- Evaluationsarelimitedforthemostparttoassessingtheimpactofafairlyshortexposuretoanewprogram(thatis,forayearortwo)onoutcomesovershortperiods.
- Animportantpolicyissueiswhetherprogramimpactschangeovertime.
- Highersubsidymayberequiredtoinducegirlstoobtainasmuchschoolingasboys.
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Motivation
- Whiletheincomeeffecttendstoincreasethetimespentinleisure,theneteffectsontimespentatschoolandworkingwouldberespectivelypositiveandnegativeifthesubstitutioneffectdominates.
- Assumingdiminishingmarginalreturnstoschooling,leadustoexpectthatovertheshortrun,theprogramislikelytodecreaseworkingbutoverthelongerrun,theprogrammightincreaseworking.
- Iftheprogramencourageschildrenwithlowerscholarlyabilitytostayinschool,wemightobserveanincreaseinschool-goingalongwithadecreaseintheratesofgradeprogressionforsuchchildren.
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MainQuestionandHowtoAnswerIt
- DoEffectsChangeOverTime?1.ImpactonSchooling2.ImpactonWorking3.ProbabilityofWorkinginAgriculture
- Thispaperevaluateslonger-runimpactsonschoolingandworkofthebest-knownCCTprogram,Mexico’sPROGRESA/Oportunidades
- Investigatetwotypesoflonger-runimpactsforthewell-knownandinfluentialMexicanPROGRESA/Oportunidades CCTprogram.
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MainQuestionandHowtoAnswerIt
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MainQuestionandHowtoAnswerIt
QuadrantB:
- Experimentalimpactsbasedonaninitialshort(18-month)differentialinexposureusingdifference-in-difference(DID)
- Estimatesthatpermitassessingwhetherinitialprogramimpactsfromshortexposuredifferentialsarerobustorfadeovertime
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MainQuestionandHowtoAnswerIt
QuadrantC:
- Difference- in-differencematching(DIDM)impactsbasedonalongerdifferentialinexposurethatprovideinsightintolonger-runprogramimpactsoflongerdifferentialinexposure
- IncomparisonwiththeestimatesofType1,intowhetherthereareincreasingordiminishingreturnstothedurationofprogramexposure.
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MainQuestionandHowtoAnswerIt
- 320communitiestoatreatmentgroupand186toacontrolgroup
- In2000,approximatelyoneandahalfyearsafterthestartoftheexperiment,thecontrolgroupcommunitiesalsobegantoreceivebenefits.
- In2003,analyzeimpactsonschoolingattainmentandlaborforceparticipationofyouthfiveandahalfyearsaftertheexperimentaltreatmentgroupfirstbeganreceivingbenefits.
- 2003:Newgroupofhouseholdsin152communitiesthathadneverreceivedbenefitsofOportunidades
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MainQuestionandHowtoAnswerIt
- Analysisfocusesonyouthwhowere9–15-years-oldin1997andwhowere15–21-years-oldin2003.
- In1997,whentheprogrambegan,thisgroupwasatorneartheageofthetransitionfromprimarytosecondaryschoolandin2003,manyoftheseyouthhadenteredthelabormarket.
- AcriticaljunctureinruralMexicoatwhichmanychildrendropoutofschool.
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Results
- Theresultsshowpositiveimpactsonschooling,reductionsinworkforyoungeryouth(consistentwithpostponinglaborforceentry),increasesinworkforoldergirls,andshiftsfromagriculturaltononagriculturalemployment.Theevidencesuggestsschoolingeffectsarerobustwithtime.
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PROGRESA/Oportunidades ImpactsonSchoolingandWorkafterFiveandaHalfYearsofanInitial18-MonthDifferentialProgramExposure
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Longer-runimpactofshortdifferentialexposure
- Evaluatewhethertheshortdifferentialexposuretotreatmentbetweenthetwogroupshadlonger-runimpactsonschoolingandwork.
- Estimateimpactsofdifferentialexposurefromalinearregressionofthedifferenceintheoutcomevariablebeforeandaftertheprogram
Controls:-parentalage,parentalschoolingattainment,indigenousstatus,andhouseholdcharacteristicsincludingnumberofrooms,electricity,typeoffloor,andwater/sewagesystem
- Toaccountforpossibleattritionbiases,weemployaweightingmethodthatisequivalenttoamatchingonobservablesapproach.
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Longer-runimpactofshortdifferentialexposure
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Longer-runimpactofshortdifferentialexposure
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Longer-runimpactofshortdifferentialexposure
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Longer-runimpactofshortdifferentialexposure
ImpactsonSchooling
- Youthwith18monthsgreaterexposuretotheprogramaccumulatedsignificantlymoreschoolingandthisdifferentialpersistedforthelonger-termfiveandahalfyearperiod
- Thelargesteffectsareobservedforthosewhohadcompletedfivegradesofschoolingby1997
- AnFtestrejectsequalityofcoefficientsatconventionalsignificancelevelsforeachsetofsubgroupsforbothmalesandfemales,suggestingdifferentimpactsofPROGRESA/Oportunidades onschoolingbyageandpreprogramschoolinggradescompleted.
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Longer-runimpactofshortdifferentialexposure
ImpactsonWorking
- ThetheoreticaleffectofPROGRESA/Oportunidades ontheprobabilityofworkingisambiguous.Overtheshortrun,theprogramdecreasesworking,butoverthelongerrun,theprogrammightincreaseworking.
- TheDIDestimateoftheimpactoftheoneandahalfyeardifferentialexposuretotheprogramonworkingfiveandahalfyearslatershowsthatgreaterexposuresignificantlydecreasestheproportionworkingby4.1percentforboyswithnosignificanteffectsforgirls.
- Effectsdonotsignificantlydifferbyagegroupsorbypreprogramschoolinglevel.
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Longer-runimpactofshortdifferentialexposure
DoEffectsChangeOverTime?
- Impactestimatesfortheyear2000arebasedoncomparingthetreatmentgroupwhichhadtwoandahalfyearsversusthecontrolgroupatnearlyayearofbenefits.Thatis,wetestwhetherimpactestimatesbasedon2000followup dataaredifferentfromthosebasedonthe2003datausedinthispaper
- Estimatesshowsignificantlyhigherestimatedimpactsfor2003than2000,thelargemajorityofthe18reportedestimatesdonotrejectthenullhypothesisofequality.TheresultssuggestthatPROGRESA/Oportunidades impactsonschoolingdonotdiminishovertime.
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Longer-runimpactofshortdifferentialexposure
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Longer-RunPROGRESA/OportunidadesImpactsafterFiveandaHalfYearsofDifferentialExposure
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Longer-runimpactoflongerdifferentialexposure
- Wecomparetheoriginaltreatmentgroups(T1998andT2000)withthenewcomparisongroup(C2003)thatwasdrawnfromruralareasthathadnotyetbeenincorporatedintotheprogramin2003.
- BecausetheC2003groupwasnotselectedrandomly,weusematchingmethodstotakeintoaccountdifferencesinobservedcharacteristicsbetweentheT2000andC2003samplesandbetweentheT1998andC2003samples.
- DIDMisanalogoustothestandardDIDregressionestimator,butdoesnotimposefunctionalformrestrictionsinestimatingthecondi- tional expectationoftheoutcomevariableandreweightstheobservationsaccordingtotheweightingfunctionsimpliedbythematchingestimators.
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Longer-runimpactoflongerdifferentialexposure
ImpactonSchooling
- Thefindingsconfirmsignificantlylargerimpactsonschoolingwithalongertimeofexposuretotheprogramthanforthosewithshortertimeofexposure.
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Longer-runimpactoflongerdifferentialexposure
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Longer-runimpactoflongerdifferentialexposure
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Girls:
Longer-runimpactoflongerdifferentialexposure
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Boys:
Longer-runimpactoflongerdifferentialexposure
ImpactonWorking
- Foryoungerboys—thatis,thoseaged9–10prepro- gramin1997—showanegativeandsignificantimpactontheprobabilityofem- ployment,consistentwithmanyboysstillattendingschoolatthisage(15–16in2003).
- Fortheolderagegroups,thereisnosignificantimpactoftheprogramonworking,whichmaymasknegativeimpactsfromsomeboyscontinuingtostudyandpositiveimpactsfromthosehavingcompletedtheirstudiesandenteringtheworkforce.
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Longer-runimpactoflongerdifferentialexposure
ProbabilityofWorkinginAgriculture
- Girlshavemuchlowerparticipationinagriculturalworkthanboys.
- Foroldergirls,forwhomtherewasasignificantincreaseintheprobabilityofworking,thereisnosignificantincreaseintheprobabilityofparticipatinginagriculturalwork,suggestiveofincreasingnonagriculturalwork.
-Thereductionsinagriculturalworkforboysaged9–10preprogramaresimilartothepercentagereductionsinwork,implyingsimilarreductionsinagriculturalasnonagriculturalwork.
- Forolderboys,onwhichtherewerenooverallsignificantprogrameffectsonworking,therearesignificantreductionsinagriculturalwork
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Longer-runimpactoflongerdifferentialexposure
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Benefit-CostEstimates
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Benefit-CostEstimates
- Hereweassumethebenefitsfromtheprogramarisefromincreasesinfutureearningsonlyasaresultoftheincreaseinschoolingattainmentfromtheprogram.
- Estimatethereturntoschoolingcontrollingforpotentialendogeneity
- Focusingonthesampleofmen,asimpleOLSestimateofreturnstoschoolingattainmentgivesavalueof7.5percentperyearforthisagegroup(16–24),theIVestimateofwagefunctionsincreasesthevaluetoabout10percent
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Benefit-CostEstimates
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SpecialThanksforYourAttendance
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