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Income Effect on Labor Outcomes for People Living in Poverty: the case of PROGRESA

Author

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  • Juliana Mesén Vargas

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

This paper studies the income effect of cash transfers on adult labor outcomes. I use data of PROGRESA, a large cash transfer program in Mexico that provides money to households subject to the condition that school aged kids go to school. I focus on a subsample of the eligibles for whom the conditionality is not a constraint. This allows me to shut-down the substitution effect that the conditionality of the transfer may induce. In practice, it is as if PROGRESA was an unconditional cash transfer for this subpopulation. Contrary to standard beliefs, I find that the income effect on labor outcomes is not negative.

Suggested Citation

  • Juliana Mesén Vargas, 2018. "Income Effect on Labor Outcomes for People Living in Poverty: the case of PROGRESA," LIDAM Discussion Papers IRES 2018015, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2018015
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    Conditional Cash Transfers; Poverty; Labor Supply;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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