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The Impact Of Educational Grants On Basic Education Completion: Do The Poor Benefit?

  • Raymond, Melanie
  • Sadoulet, Elisabeth

Cash transfers can help poor families to meet the costs associated with sending their children to school. Demand constraints are a major impediment to schooling attainment in rural areas. Educational grants can contribute to raise schooling attainment in rural areas and thereby to close the gap between educational levels in rural areas and national levels. In 1997, the Mexican government initiated such a program of cash transfers, called PROGRESA, targeted to children living in poor and extremely poor rural regions. The present work shows that the program effectively retains children in school leading to important gains in schooling attainment. The grants succeed at lowering the drop out rates by 30-45\% for the eligible grades of primary and secondary school. On average, the program increases the schooling attainment of the poor by almost 5 months, from 6.9 years to 7.4 years. Moreover, the program successfully reaches the poorest and benefits them most. Children from the second lowest well-being quintile, as measured by a poverty index, are the ones that gain most from the program, along with children of uneducated parents. Finally, relaxing demand constraints with some financial help counters effectively the school accessibility constraints at the secondary school level.

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File URL: http://purl.umn.edu/20585
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Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2001 Annual meeting, August 5-8, Chicago, IL with number 20585.

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Date of creation: 2001
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Handle: RePEc:ags:aaea01:20585
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  1. Aysit Tansel, 1998. "Determinants of School Attainment of Boys and Girls in Turkey," Working Papers 9810, Economic Research Forum, revised Jul 1998.
  2. Elizabeth King & Eric Bettinger & Erik Bloom & Joshua Angrist & Michael Kremer, 2002. "Vouchers for private schooling in colombia: Evidence from a randomized natural experiment," Natural Field Experiments 00203, The Field Experiments Website.
  3. Paul Glewwe & Hanan Jacoby, 1994. "Student Achievement and Schooling Choice in Low-Income Countries: Evidence from Ghana," Journal of Human Resources, University of Wisconsin Press, vol. 29(3), pages 843-864.
  4. West, Edwin G, 1997. "Education Vouchers in Principle and Practice: A Survey," World Bank Research Observer, World Bank Group, vol. 12(1), pages 83-103, February.
  5. Kim, Jooseop & Alderman, Harold & Orazem, Peter F, 1999. "Can Private School Subsidies Increase Enrollment for the Poor? The Quetta Urban Fellowship Program," World Bank Economic Review, World Bank Group, vol. 13(3), pages 443-65, September.
  6. Lillard, L.A. & Willis, R.J., 1993. "Intergenerational Educational Mobility: Efects of Family and State in Malaysia," Papers 93-38, RAND - Labor and Population Program.
  7. Kiefer, Nicholas M, 1988. "Economic Duration Data and Hazard Functions," Journal of Economic Literature, American Economic Association, vol. 26(2), pages 646-79, June.
  8. Behrman, Jere R & Sengupta, Piyali & Todd, Petra, 2005. "Progressing through PROGRESA: An Impact Assessment of a School Subsidy Experiment in Rural Mexico," Economic Development and Cultural Change, University of Chicago Press, vol. 54(1), pages 237-75, October.
  9. Antoine Bommier & Sylvie Lambert, 2000. "Education Demand and Age at School Enrollment in Tanzania," Journal of Human Resources, University of Wisconsin Press, vol. 35(1), pages 177-203.
  10. Lopez Acevedo, Gladys, 1999. "Learning outcomes and school cost-effectiveness in Mexico : the PARE program," Policy Research Working Paper Series 2128, The World Bank.
  11. Behrman, Jere R & Knowles, James C, 1999. "Household Income and Child Schooling in Vietnam," World Bank Economic Review, World Bank Group, vol. 13(2), pages 211-56, May.
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