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Welfare programs and labor supply in developing countries: experimental evidence from Latin America

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  • María Alzúa
  • Guillermo Cruces

    ()

  • Laura Ripani

Abstract

This study looks at the effect of welfare programs on work incentives and the adult labor supply in developing countries. The analysis builds on the experimental evaluations of three programs implemented in rural areas: Mexico’s Programa Nacional de Educación, Salud y Alimentación (PROGRESA), Nicaragua’s Red de Protección Social, and Honduras’ Programa de Asignación Familiar. Comparable results for the three countries indicate that the effects that the programs have had on the labor supply of participating adults have been mostly negative but are nonetheless small and not statistically significant. However, the evidence does point to the presence of other effects on labor markets. In the case of PROGRESA, there is a small positive effect on the number of hours worked by female beneficiaries and a sizeable increase in wages among male beneficiaries and a resulting increase in household labor income. Moreover, PROGRESA seems to have reduced female labor-force participation in ineligible households. These results imply that large-scale interventions may have broader equilibrium effects. Copyright Springer-Verlag Berlin Heidelberg 2013

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Bibliographic Info

Article provided by Springer in its journal Journal of Population Economics.

Volume (Year): 26 (2013)
Issue (Month): 4 (October)
Pages: 1255-1284

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Handle: RePEc:spr:jopoec:v:26:y:2013:i:4:p:1255-1284

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Keywords: Welfare programs; Income support; Labor supply; Work incentives; Conditional cash transfers; Randomized control trials; Developing countries; J08; J22; I38;

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Citations

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Cited by:
  1. Sebastian Galiani & Patrick J. McEwan, 2013. "The Heterogeneous Impact of Conditional Cash Transfers," CEDLAS, Working Papers 0149, CEDLAS, Universidad Nacional de La Plata.
  2. Asel Isakova & Alexander Plekhanov & Jeromin Zettelmeyer, 2012. "Managing Mongolia’s resource boom," Working Papers 138, European Bank for Reconstruction and Development, Office of the Chief Economist.
  3. Mariano Bosch & Marco Manacorda, 2012. "Social Policies and Labor Market Outcomes in Latin America and the Caribbean: A Review of the Existing Evidence," CEP Occasional Papers 32, Centre for Economic Performance, LSE.
  4. Lia Chitolina & Miguel Nathan Foguel & Naercio Menezes-Filho, 2013. "The Impact of the Expansion of the Bolsa Família Programme on the Time Allocation of Youths and Labour Supply of Adults," Working Papers 120, International Policy Centre for Inclusive Growth.
  5. Solomon Asfaw & Silvio Daidone & Benjamin Davis & Josh Dewbre & Alessandro Romeo & Paul Winters & Katia Covarrubias & Habiba Djebbari, 2012. "Analytical Framework for Evaluating the Productive Impact of Cash Transfer Programmes on Household Behaviour ? Methodological Guidelines for the From Protection to Production Project," Working Papers 101, International Policy Centre for Inclusive Growth.
  6. Armando Barrientos & Juan Miguel Villa, 2013. "Antipoverty transfers and labour force participation effects," Brooks World Poverty Institute Working Paper Series 18513, BWPI, The University of Manchester.
  7. Andrés Ham, 2010. "The Effect of Conditional Cash Transfers on Educational Opportunities - Experimental Evidence from Latin America," CEDLAS, Working Papers 0109, CEDLAS, Universidad Nacional de La Plata.
  8. Rafael Novella & Laura Ripani & Guillermo Cruces & Maria Laura Alzuá, 2012. "Conditional Cash Transfers, Female Bargaining Power and Parental Labour Supply," IDB Publications 78223, Inter-American Development Bank.
  9. Fernando Fernandez & Victor Saldarriaga, 2014. "Do benefit recipients change their labor supply after receiving the cash transfer? Evidence from the Peruvian Juntos program," IZA Journal of Labor & Development, Springer, vol. 3(1), pages 1-30, December.
  10. Leibbrandt, Murray & Lilenstein, Kezia & Shenker, Callie & Woolard, Ingrid, 2013. "The influence of social transfers on labour supply: A South African and international review," SALDRU Working Papers 112, Southern Africa Labour and Development Research Unit, University of Cape Town.
  11. Leonardo Gasparini & Guillermo Cruces, 2010. "Las Asignaciones Universales Por Hijo. Impacto, Discusión y Alternativas," CEDLAS, Working Papers 0102, CEDLAS, Universidad Nacional de La Plata.
  12. Alderman, Harold & Yemtsov, Ruslan, 2013. "How can safety nets contribute to economic growth ?," Policy Research Working Paper Series 6437, The World Bank.
  13. Nicola Brandt, 2012. "Reducing Poverty in Chile: Cash Transfers and Better Jobs," OECD Economics Department Working Papers 951, OECD Publishing.
  14. Debowicz, Dario & Golan, Jennifer, 2013. "The impact of Oportunidades on human capital and income distribution: A top-down/bottom-up approach," IFPRI discussion papers 1257, International Food Policy Research Institute (IFPRI).
  15. Alzúa, María Laura & Cruces, Guillermo & Ripani, Laura, 2012. "Welfare Programs and Labor Supply in Developing Countries: Experimental Evidence from Latin America," IZA Discussion Papers 6959, Institute for the Study of Labor (IZA).

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