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Culture and Human Capital Investments: Evidence of an Unconditional Cash Transfer Program in Bolivia

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Author Info
Yanez-Pagans, Monica () (University of Illinois at Urbana-Champaign)

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Abstract

This paper uses a policy quasi-experiment created by the introduction of an old-age unconditional cash transfer program in Bolivia to study the intra-household income allocation process towards children's educational expenditure by ethnicity and gender of the recipient. Taking advantage of a sharp discontinuity created by the program assignment mechanism, I investigate the heterogeneity in the patterns of allocation within indigenous, multiethnic, and non-indigenous families, conditional on having one elder and one school-age child living in the household. I find that cultural factors (proxied by ethnicity) count in the decision making process of human capital investments. In particular, the allocation of resources within indigenous families follows rules closely related to patriarchal family structures (in which women have limited decision-making power) and is consistent with unitary, dictatorial, and common preferences theoretical household models. Conversely, non-indigenous families follow decision rules more closely related to collective and bargaining behavior models.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3678.

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Length: 23 pages
Date of creation: Sep 2008
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Handle: RePEc:iza:izadps:dp3678

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Related research
Keywords: Bolivia; culture; Bolivida; educational expenditure;

Find related papers by JEL classification:
H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
I12 - Health, Education, and Welfare - - Health - - - Health Production
D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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References listed on IDEAS
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  1. Vani Borooah & Sriya Iyer, 2005. "Vidya , Veda , and Varna : The influence of religion and caste on education in rural India," The Journal of Development Studies, Taylor and Francis Journals, vol. 41(8), pages 1369-1404, November. [Downloadable!] (restricted)
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  2. Case, Anne & Deaton, Angus, 1998. "Large Cash Transfers to the Elderly in South Africa," Economic Journal, Royal Economic Society, vol. 108(450), pages 1330-61, September. [Downloadable!] (restricted)
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  3. Psacharopoulos, George, 1992. "Ethnicity, education, and earnings in Bolivia and Guatemala," Policy Research Working Paper Series 1014, The World Bank. [Downloadable!]
  4. Edmonds, Eric V., 2006. "Child labor and schooling responses to anticipated income in South Africa," Journal of Development Economics, Elsevier, vol. 81(2), pages 386-414, December. [Downloadable!] (restricted)
  5. Skeels, Christopher L. & Vella, Francis, 1999. "A Monte Carlo investigation of the sampling behavior of conditional moment tests in Tobit and Probit models," Journal of Econometrics, Elsevier, vol. 92(2), pages 275-294, October. [Downloadable!] (restricted)
  6. Imbens, Guido W. & Lemieux, Thomas, 2008. "Regression discontinuity designs: A guide to practice," Journal of Econometrics, Elsevier, vol. 142(2), pages 615-635, February. [Downloadable!] (restricted)
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  7. McDonald, John F & Moffitt, Robert A, 1980. "The Uses of Tobit Analysis," The Review of Economics and Statistics, MIT Press, vol. 62(2), pages 318-21, May. [Downloadable!] (restricted)
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