The Impact of the Bolsa Escola/Familia Conditional Cash Transfer Program on Enrollment, Drop Out Rates and Grade Promotion in Brazil

This paper examines the impact of Brazil's Bolsa Escola (later renamed Bolsa Familia) program on children's progress in school in Brazil. The Bolsa program, which started in the 1990s and expanded rapidly in 2001 and 2002, provides monthly cash payments to poor households if their children (between the ages of 6 and 15) are enrolled in school. Using eight years of school census data (from 1998 to 2005), our estimation method compares changes in enrollment and in dropout and grade advancement rates across schools that adopted the Bolsa program at different times. We estimate that, after accounting for cumulative effects, the Bolsa program has increased enrollment in Brazil by about 5.5 percent in grades 1-4 and by about 6.5 percent in grades 5-8. We also estimate that the program has lowered dropout rates by about 0.5 percentage points and raised grade promotion rates by about 0.9 percentage points for children in grades 1-4, and has reduced dropout rates by about 0.4 percentage points and increased grade promotion rates by about 0.3 percentage points for children in grades 5-8. Only about one third of Brazil’s children participate in the Bolsa program, so the assumption that these results are mainly due to the impact of the program on participants, with no effect on non-participants, implies that the impact of participating in the Bolsa program is about three times higher than these estimates. While these impacts cast a favorable light on the program, simple calculations based on the enrollment impacts suggest that the likely benefits in terms of increased wages may not exceed the costs of the program.