Hostname: page-component-848d4c4894-4rdrl Total loading time: 0 Render date: 2024-06-22T09:06:40.914Z Has data issue: false hasContentIssue false
  • English
  • Français

Can poverty alleviation programs crowd-in private support? Short- and Middle-Run Effects of a Conditional Cash Transfer Program on Inter-Household Transfers

Published online by Cambridge University Press:  19 May 2020

SANDRA GARCÍA Open the ORCID record for SANDRA GARCÍA [Opens in a new window]  and
JORGE CUARTAS
SANDRA GARCÍA
Affiliation:
Associate professor, Alberto Lleras Camargo School of Government, Universidad de los Andes, Cra. 1 No. 19-27, Bloque Au, Piso 3. Bogotá-Colombia, email: sagarcia@uniandes.edu.co
JORGE CUARTAS
Affiliation:
Harvard University, email: jcuartas@g.harvard.edu
Get access Rights & Permissions [Opens in a new window]

Abstract

Conditional cash transfer (CCT) programs have become an important component of social assistance in developing countries. CCTs, as well as other cash subsidies, have been criticized for allegedly crowding out private transfers. Whether social programs crowd out private transfers is an important question with worrisome implications, as private support represents an important fraction of households’ income and works as a risk sharing mechanism in developing countries. Furthermore, empirical evidence on the effect of public transfers on private transfers is mixed. This paper contributes to the literature by using a unique dataset from the quasi-experimental evaluation of a CCT in Colombia and an empirical strategy that allows us to correct for pre-existing differences between treated and control groups. Our results suggest that the public transfer did not crowd out private transfers, neither in the short-run nor in the middle-run. Instead, it increased the probability of receiving support in cash, in kind, and in non-paid labor from different private sources by approximately 10 percentage points. Moreover, we find that the monetary value of private transfers increased by 32-38% for treated households.

Keywords

conditional cash transferpublic transfersprivate transfersinter-household transferscrowding-out
Type
Article
Information
Journal of Social Policy , Volume 50 , Issue 3 , July 2021 , pp. 511 - 532
Copyright
© The Author(s), 2020. Published by Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Acción Social. (2010), Entre la memoria y el olvido: voces de las madres. Bogotá, Colombia.Google Scholar
Acción Social and DNP (2010), El camino recorrido: diez años de Familias en Acción. Departamento Nacional de Planeación. Bogotá, Colombia.Google Scholar
Albarran, P. and Attanasio, O. P. (2003), Limited commitment and crowding out of private transfers: Evidence from a randomised experiment. The Economic Journal, 113(486), C77–C85.CrossRefGoogle Scholar
Angelucci, M., Attanasio, O. and Di Mario, V. (2012), The impact of oportunidades on consumption, savings and transfers. Fiscal Studies, 33(3), 305–334.CrossRefGoogle Scholar
Attanasio, O., Fitzsimons, E., Gomez, A., Gutiérrez, M. I., Meghir, C. and Mesnard, A. (2010), Children’s schooling and work in the presence of a conditional cash transfer program in rural Colombia. Economic Development and Cultural Change, 58(2), 181–210.CrossRefGoogle Scholar
Attanasio, O., Polania-Reyes, S. and Pellerano, L. (2015), Building social capital: Conditional cash transfers and cooperation. Journal of Economic Behavior & Organization, 118, 22–39.CrossRefGoogle Scholar
Baird, S., McIntosh, C. and Özler, B. (2019), When the money runs out: Do cash transfers have sustained effects on human capital accumulation? Journal of Development Economics, 140, 169–185.CrossRefGoogle Scholar
Barro, R. J. (1974), Are government bonds net wealth? Journal of Political Economy, 82, 1095–1117.CrossRefGoogle Scholar
Becker, G. S. (1974), A theory of social interactions. Journal of Political Economy, 82(6), 1063–1093.CrossRefGoogle Scholar
Bernal, R. and Peña, X. (2011), Guía práctica para la evaluación de impacto. Ediciones Uniandes, Bogotá: Colombia.Google Scholar
Cecchini, S. and Atuesta, B. (2017), Conditional cash transfer programmes in Latin America and the Caribbean: Coverage and investment trends. ECLA – Social Policy Series N° 224, Economic Commission for Latin America.CrossRefGoogle Scholar
Curchin, K. (2019), The illiberalism of behavioural conditionality: A critique of Australia’s ‘No Jab, No Pay’ policy. Journal of Social Policy, 48(4), 789–805.CrossRefGoogle Scholar
Cox, D., Eser, Z. and Jimenez, E. (1998), Motives for private transfers over the lyfe cycle: An analytical framework and evidence for Peru. Journal of Development Economics, 55, 57–80.CrossRefGoogle Scholar
Cox, D. and Jimenez, E. (1990), Achieving social objectives through private transfers: A review. The World Bank Economic Review, 5(2), 205–218.Google Scholar
Cox, D. and Jimenez, E. (1992), Social security and private transfers in developing countries: The case of Peru. World Bank Economic Review, 6(1), 155–169.CrossRefGoogle Scholar
DNP. (2006), Programa Familias en Acción Impacto del Programa a un año y medio de su ejecución. Departamento Nacional de Planeación. Bogotá, Colombia.Google Scholar
Fafchamps, M. (2011), Risk sharing between households. In Benhabib, J., Bisin, A. and Jackson, M. (Eds.), Handbook of Social Economics (pp. 1255–1279), Elsevier B.V. Google Scholar
Fiszbein, A., Schady, N., Ferreira, F.H.G., Grosh, M., Kelleher, N., Olinto, P. and Skoufias, E. (2009), Conditional Cash Transfers: Reducing Present and Future Poverty. World Bank Policy Research Report. Washington, DC: World Bank.CrossRefGoogle Scholar
García, S. and Saavedra, J. E. (2017), Educational impacts and cost-effectiveness of conditional cash transfer programs in developing countries: A meta-analysis. Review of Educational Research, 87(5), 921–965.CrossRefGoogle Scholar
Gerardi, K. and Tsai, Y. (2014), The effect of social entitlement programmes on private transfers: New evidence of crowding out. Economica, 81: 721–746.CrossRefGoogle Scholar
Gómez, L.C., Attanasio, O., Corral, LC., Alviar, C. and Llanes, L. (2004), Evaluación del impacto del programa Familias en Acción – subsidio condicionados de la red de apoyo social: informe final línea de base. IFS, Econometría S.A., SEI. Colombia.Google Scholar
Hainmueller, J. (2012), Entropy balancing for causal effects: a multivariate reweighting method to produce balanced samples in observational studies. Political Analysis, 20(1), 25–46.CrossRefGoogle Scholar
Ibarrarán, P., Medellín, N., Regalia, F. and Stampini, M. (2017), How Conditional Cash Transfers Work: Good Practices after 20 Years of Implementation Washington DC: Inter-American Development Bank.CrossRefGoogle Scholar
Kananurak, P. and Sirisankanan, A. (2016), Do public transfers crowd-out private transfers? Evidence from the Thai socio-economic panel survey. Applied Economics Journal, 23(2), 29–47.Google Scholar
Iacus, S. M., King, G. and Porro, G. (2011), Causal inference without balance checking: coarsened exact matching. Political Analysis, 20(1), 1–24.CrossRefGoogle Scholar
IFS-Econometria-SEI. (2003), Methodological Report on the Evaluation of Familias en Acción. Bogotá.Google Scholar
Imbens, G. and Wooldridge, J. (2007), Difference-in-difference estimation. NBER Lecture 10: What’s New in Econometrics?Google Scholar
Jensen, R. T. (2003), Do private transfers ‘displace’ the benefits of public transfers? Evidence from South Africa. Journal of Public Economics, 88, 89–112.CrossRefGoogle Scholar
Juarez, L. (2009), Crowding out of private support to the elderly: Evidence from a demogrant in Mexico. Journal of Public Economics, 93(3-4), 454–463.CrossRefGoogle Scholar
Jung, H., Pirog, M. and Lee, S.K. (2016), Do public pensions crowd out private transfers to the elderly? Evidence from South Korea. Journal of Pension Economics and Finance, 15(4), 455–477.CrossRefGoogle Scholar
Kang, S.J. and Sawada, Y. (2003), Are private transfers altruistically motivated? The case of the Republic of Korea before and during the financial crisis. The Developing Economies, XLI-4, 484–501.CrossRefGoogle Scholar
Kazianga, H. (2006), Motives for household private transfers in Burkina Faso. Journal of Development Economics, 79(1), 73–117.CrossRefGoogle Scholar
Lai, M. S. and Orsuwan, M. (2009), Examining the impact of Taiwan’s cash allowance program on private households. World Development, 37(7), 1250–1260.CrossRefGoogle Scholar
Molina-Millán, T., Barham, T., Macours, K., Maluccio, J. and Stampini, M. (2019), Long-term impacts of conditional cash transfers: Review of the evidence, The World Bank Research Observer, 34(1) 119–15.CrossRefGoogle Scholar
Mozumder, P., Bohara, A., Berrens, R. and Halim, N. (2009), Private transfers to cope with a natural disaster: evidence from Bangladesh. Environment and Development Economics, 14(2), 187–210.CrossRefGoogle Scholar
Nielsen, M. E. and Olinto, P. (2007), Do conditional cash transfers crowd out private transfers? Evidence from randomized trials in Honduras and Nicaragua. Unpublished manuscript.Google Scholar
Presidencia de la República (2002), Cuidados para crecer sanos, fuertes y felices. Informative Booklet, Programa Familias en Acción. ColombiaGoogle Scholar
Presidencia de la República (2004), Baraja de Familias en Acción. Deck of informative cards, Programa Familias en Acción. ColombiaGoogle Scholar
Presidencia de la República (2005), Por un espacio que nos pertenece ¿cómo preservar los beneficios que ha generado Familias en Acción?. Informative Booklet, Programa Familias en Acción. ColombiaGoogle Scholar
Rosenzweig, M. and Wolpin, K. I. (1994), Are there increasing returns to the intergenerational production of human capital? Maternal schooling and child intellectual achievement. The Journal of Human Resources, 29(2), 670–693.CrossRefGoogle Scholar
Schoeni, R. F. (2002), Does unemployment insurance displace familial assistance? Public Choice, 110, 99–119.CrossRefGoogle Scholar
Sulaiman, M. (2010), Incentive and crowding out effects of food assistance: evidence from randomized evaluation of food-for-training project in Southern Sudan. London: London Schoool of Economics and BRAC.Google Scholar
Strobbe, F. and Miller, C. (2011), Cash transfers in an epidemic context : the interaction of formal and informal support in rural Malawi (English). Policy Research working paper; no. WPS 5824. Washington, DC: World Bank. http://documents.worldbank.org/curated/en/898521468048891114/Cash-transfers-in-an-epidemic-context-the-interaction-of-formal-and-informal-support-in-rural-Malawi CrossRefGoogle Scholar
Teruel, G. and Davis, B. (2000), Una evaluación del impacto de los apoyos en efectivo de Progresa sobre las transferencias privadas entre los hogares. Progresa Report: 2000, Washington, D.C. International Food Policy Research Institute.Google Scholar
Supplementary material: File

García and Cuartas supplementary material

García and Cuartas supplementary material

Download García and Cuartas supplementary material(File)
File 18.3 KB