Intra-Village Expansion of Welfare Programs

This paper studies, both theoretically and empirically, the intra-village expansion of the Oportunidades welfare program, to understand the relationship between the number of beneficiaries and the size of average treatment effects. At some point, the Mexican government relaxed the program's eligibility requirements. As a result, rural villages experienced a large increase in the share of residents receiving Oportunidades cash benefits. We compare, shortly before and after the inclusion of additional beneficiaries, the size of the average treatment effect (ATE) on households who were beneficiaries already prior to the program's intra-village expansion. Our findings suggests an increase in the ATE for nutrition and health, yet a decrease in the ATE for school enrollment and attendance. Disregarding possibly adverse affects on schooling, our analysis implies that geographic targeting would increase the program's global impact.