Do Conditional Cash Transfers for Schooling Generate Lasting Benefits? A Five-Year Follow-up of PROGRESA/Oportunidades

Latin America and the Caribbean

Mexico

Social Protection

Conditional Cash Transfers (CCT)

Behrman, J. R., J. Gallardo-García, S. W. Parker, P. E. Todd and V. Vélez-Grajales

2010

Behrman, J. R., J. Gallardo-García, S. W. Parker, P. E. Todd and V. Vélez-Grajales. 2011. “Do Conditional Cash Transfers for Schooling Generate Lasting Benefits? A Five-Year Follow-up of PROGRESA/Oportunidades.” Journal of Human Resources, 46 (1): 93-122.
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2011

Oportunidades

1997-2003

To increase household investment in education, health, and nutrition.

Oportunidades is targeted at poor households. In rural areas, these households are selected in two steps. First, the poorest rural communities are selected based on a “marginality index” constructed from 1990 National Census data. Next, households in each of those communities are ranked on the basis of a poverty index (based on the census 1997).

The program has two main subsidy components: a health and nutrition subsidy and a schooling subsidy. Schooling subsidy amounts increase with grade level, to offset the higher opportunity costs of working for older children. To receive the health and nutrition benefit, household members have to attend clinics for regular check-ups and attend informational health talks. To receive the school subsidy, children or youth in participating households have to attend school in one of the subsidy-eligible grade levels (grades 3-12) for at least 85% of school days. Households can choose to participate only in the health and nutrition component. And participating households can choose to send only a subset of their children to school for the required time.

• Children’s work: probability of working
• Children’s work: probability of participating in agricultural work
• Education: grades of schooling

Randomized control trial and non-experimental propensity score matching

Study design: The study contains two separate sets of results to investigate the long/run effects of Oportunidades. In the first set of results, the authors examine the impact of 5.5 years of exposure to Oportunidades versus 4 years of exposure. To do so, the authors exploit the original randomized evaluation in which 506 communities were randomly grouped into 320 treatment communities and 186 control communities. In the treatment communities Oportunidades was implemented in the spring of 1998 whereas the eligible households in the control group began receiving benefits at the end of 1999.
In the second set of results, the authors examine the impact of 5.5 years of exposure to Oportunidades to no exposure. To do so, the authors rely on non-experimental propensity score matching techniques to compare the original treatment group to a new comparison group drawn from rural areas that had not yet been incorporated into the program.
Estimation strategy: The authors estimate the impact of 5.5 years of exposure versus 4 years of exposure from a linear regression of the difference in the outcome variable before and after the program on an indicator of whether each program eligible individual resided in an original treatment or original control locality. Additional covariates are included as controls. To account for possible attrition biases, the authors estimate regressions of program impact, where both the treatment and control group observations are weighted to adjust for differences in the distribution of observable characteristics arising over time because of attrition.
To estimate the effect of 5.5 years of exposure versus no exposure the authors use difference in difference matching estimators. The DIDM propensity score matching estimators are estimated in two stages. In the first stage, the propensity score is estimated using a logistic model and a set of preprogram (1997) household and locality level characteristics. The second stage uses local linear regression to construct matched no-treatment outcomes for each treated individual.
Data: The 1997 Survey of Household Socio-Economic Conditions serves as a baseline survey for the study. This survey was originally used to select households in the eligible communities for participation in PROGRESA/Oportunidades. Between 1997 and 2000, evaluation surveys with detailed information on demographics, schooling, health, income and expenditures were administered every six months to all households covered by the baseline survey. In 2003, there was a new follow-up round of the rural evaluation survey that included all the households that could be located in the original 320 treatment communities, and the original 186 control communities.
The 2003 follow-up round also collected data on a new group of households drawn from rural areas that had not yet been incorporated into the program in 2003. The localities that were included in the sampling frame for this group were selected by matching on locality characteristics constructed using household information aggregated at the community level from the 1995 and 2000 Censuses on housing attributes, demographic structure, poverty levels, labor force participation, and ownership of durable goods. Selected localities were also constrained to come from the same states as the original 506 evaluation communities with the exception of one state where some communities from a neighbor state were used. All communities were constrained to satisfy PROGRESA/Oportunidades eligibility characteristics with regard to distance to schools and health clinics. For the new comparison group households recall data were collected to characterize their eligibility status in 1997.

Impact of 5.5 years of exposure versus 4 years of exposure: Education: By 2003, children in the original treatment group had on average completed about a fifth of a grade more than children in the original control group (0.18 for boys and 0.20 for girls). This finding implies that, over a 1.5 years additional exposure increased schooling grades completed by about 2.4% for boys and 2.7% for girls. The largest effects are observed for those who had completed five grades of schooling by 1997 (effects of 6.8% for girls, 4.4% for boys). The effects are most pronounced for those entering the last year of primary school at the time the program was introduced. Children’s work: The estimate of the impact of the 1.5 year differential exposure to the program shows that greater exposure does not significantly affect working 5.5 years later among children who were 9 to 10 in 1997 (15 to 16 in 2003). Impact of 5.5 years of exposure versus no exposure: Education: Boys age 9 to 10 pre-program (15 to 16 in 2003) accumulate 1.0 additional grades compared to boys without the program, while boys age 11-12 pre-program accumulate an additional 0.9 grades. Boys 13 to 15 pre-program accumulate about half a year of additional schooling. Impacts are also significant, although slightly smaller, for girls between the ages of 9 and 12 pre-program, who accumulate 0.7 to 0.8 grades of schooling. There are no significant impacts for older girls. Children’s work: boys aged 9 to10 in 1997 show a negative and significant impact on the probability of employment of 14 percentage points, consistent with many boys still attending school at this age (15 to 16 in 2003). There is no significant impact on working for younger girls.

Child Labour

Households

National

The estimate of the impact of the 1.5 year differential exposure to the program shows that greater exposure does not significantly affect working 5.5 years later among children who were 9 to 10 in 1997 (15 to 16 in 2003). Boys aged 9 to 10 in 1997 show a negative and significant impact on the probability of employment of 14 percentage points, consistent with many boys still attending school at this age (15 to 16 in 2003). There is no significant impact on working for younger girls.

By 2003, children in the original treatment group had on average completed about a fifth of a grade more than children in the original control group (0.18 for boys and 0.20 for girls). This finding implies that, over a 1.5 years additional exposure increased schooling grades completed by about 2.4% for boys and 2.7% for girls. The largest effects are observed for those who had completed five grades of schooling by 1997 (effects of 6.8% for girls, 4.4% for boys). The effects are most pronounced for those entering the last year of primary school at the time the program was introduced. Boys age 9 to 10 pre-program (15 to 16 in 2003) accumulate 1.0 additional grades compared to boys without the program, while boys age 11-12 pre-program accumulate an additional 0.9 grades. Boys 13 to 15 pre-program accumulate about half a year of additional schooling. Impacts are also significant, although slightly smaller, for girls between the ages of 9 and 12 pre-program, who accumulate 0.7 to 0.8 grades of schooling. There are no significant impacts for older girls.

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