The Impact of Unconditional Cash Transfers on Parenting and Children

This paper examines the impact of a large, randomized cash transfer on parental behaviors, investment in children, children's social, behavioral, and educational outcomes, and pregnancy and childbearing. We find that parents who were randomly selected to receive a $1,000 per month unconditional cash transfer for three years spent more on their children each month and reported better parenting behaviors (such as supervising their children more closely) compared to those randomized to receive $50 per month over the same period. However, possibly due to this closer monitoring, parents in the treatment group also reported that their child was experiencing more developmental difficulties and stress. Parents with the lowest incomes at baseline experienced the largest improvements in parenting; among these parents, the transfer also increased the use and quality of non-parental child care. The transfer did not have a meaningful effect on most educational outcomes measured in school administrative records, nor did it affect characteristics of the home environment, child food security, exposure to homelessness, or parental satisfaction. Although treated families were more likely to move, we did not detect changes in most measures of neighborhood quality, though proximity to child-focused amenities such as daycares appeared to increase in the treatment group relative to the control group. The transfer did not affect childbearing, pregnancy, or outcomes related to contraception. While the transfer reduced parents' stress and mental distress in the first year of the program, these effects were short-lived and dissipated by the second year of the transfer, analogous to what was documented previously in the full population of participants.