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Long-Term Effects of Conditional Cash Transfers on Children: The Brazilian Case

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  • Gabriel Lyrio Oliveira
  • Andre Luis Squarize Chagas

Abstract

In this paper, we present some long-term effects of the largest Conditional Cash Transfers program in the world, and one of the pioneers, the Bolsa Família Program (BFP). We focus on the effects on Schooling attained in early adulthood and Labor Market outcomes of individuals more or less exposed during their childhood. The estimates were enabled by linking identified data from Formal Labor Market, BFP Payment Records, and the Single Registry (SR). In this Natural Experiment, the main identification strategy relies on a rich set of control variables, and on the fact that the release of BFP resources for registered families is automatized and based on municipality poverty parameters estimated by the government. In an alternative identification strategy, we consider an instrumental variable, the observed proxy for the municipality effort to register vulnerable families. These strategies help to solve the potential selection bias of families to the SR, and consequently to the treatment. Nonetheless, since the program selects the most vulnerable families, the threats to the identification suggest that the estimates are lower bounds. Our main results show positive long-term effects on Schooling, and on the Formal Labor Market participation, while mixed results are observed for Earnings. Heterogeneity tests suggest that the effects are stronger for boys, for smaller cities, and for families with never formally employed parents.

Suggested Citation

  • Gabriel Lyrio Oliveira & Andre Luis Squarize Chagas, 2020. "Long-Term Effects of Conditional Cash Transfers on Children: The Brazilian Case," Working Papers, Department of Economics 2020_16, University of São Paulo (FEA-USP).
    • Handle: RePEc:spa:wpaper:2020wpecon16
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    References listed on IDEAS

    as
    1. Teresa Molina Millán & Tania Barham & Karen Macours & John A Maluccio & Marco Stampini, 2019. "Long-Term Impacts of Conditional Cash Transfers: Review of the Evidence," The World Bank Research Observer, World Bank, vol. 34(1), pages 119-159.
    2. Susan W Parker & Tom Vogl, 2023. "Do Conditional Cash Transfers Improve Economic Outcomes in the Next Generation? Evidence from Mexico," The Economic Journal, Royal Economic Society, vol. 133(655), pages 2775-2806.
    3. Teresa Molina Millán & Tania Barham & Karen Macours & John A Maluccio & Marco Stampini, 2019. "Long-Term Impacts of Conditional Cash Transfers: Review of the Evidence," The World Bank Research Observer, World Bank, vol. 34(1), pages 119-159.
    4. Molina Millán, Teresa & Macours, Karen & Maluccio, John A. & Tejerina, Luis, 2020. "Experimental long-term effects of early-childhood and school-age exposure to a conditional cash transfer program," Journal of Development Economics, Elsevier, vol. 143(C).
    5. Hewings, Geoffrey J.D. & Azzoni, Carlos Roberto & Guilhoto, Joaquim José Martins & Haddad, Eduardo A. & Laes, M. A. & Moreira, Guilherme Renato Caldo, 2007. "Social policies, personal and regional income inequality in Brazil: an I-O analysis of the "Bolsa Família" program," MPRA Paper 54508, University Library of Munich, Germany.
    6. Azzoni, Carlos Roberto & Guilhoto, Joaquim José Martins, 2009. "Social policies, personal and regional income inequality in Brazil: an I-O analysis," MPRA Paper 54498, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Conditional Cash Transfers; Long-term effects; Human Capital; Labor Market; Bolsa Família;
    All these keywords.

    JEL classification:

    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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