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Can Conditional Cash Transfers Serve as Safety Nets to Keep Children at School and Out of the Labor Market?

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  • de Janvry, Alain
  • Finan, Frederico
  • Sadoulet, Elisabeth

Abstract

Conditional cash transfer (CCT) programs for education are known to be effective in increasing educational achievements among the rural poor. Using panel data from the Progresa experience with randomized treatment, we show that there is strong state dependence in school attendance. Short term shocks that take children out of school will consequently have long term consequences on their educational achievements. We show that idiosyncratic and covariate shocks do indeed push parents to take children out of school and to use child labor as risk coping instruments. However, CCT help protect children from these shocks, creating an additional benefit from these programs as effective safety nets with long term benefits.

Suggested Citation

  • de Janvry, Alain & Finan, Frederico & Sadoulet, Elisabeth, 2004. "Can Conditional Cash Transfers Serve as Safety Nets to Keep Children at School and Out of the Labor Market?," CUDARE Working Papers 25075, University of California, Berkeley, Department of Agricultural and Resource Economics.
    • Handle: RePEc:ags:ucbecw:25075
    DOI: 10.22004/ag.econ.25075
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    3. Gitter, Seth R. & Barham, Bradford L., 2007. "Credit, Natural Disasters, Coffee, and Educational Attainment in Rural Honduras," World Development, Elsevier, vol. 35(3), pages 498-511, March.

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