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Evidence of eligibility manipulation for conditional cash transfer programs

Author

Listed:
  • Sergio Firpo

    (C-Micro – FGV, Escola de Economia de São Paulo (EESP) – FGV, Brazil)

  • Renan Pieri

    (C-Micro – FGV, Escola de Economia de São Paulo (EESP) – FGV, Brazil)

  • Euclides Pedroso Jr.

    (C-Micro – FGV, Escola de Economia de São Paulo (EESP) – FGV, Brazil)

  • André Portela Souza

    (C-Micro – FGV, Escola de Economia de São Paulo (EESP) – FGV, Brazil)

Abstract

This paper assesses whether eligibility for conditional cash transfer programs has been manipulated, as well as the impact of this phenomenon on time allocation within households. To perform this analysis, we use data from the 2006 PNAD (Brazilian national household survey) and investigate the eligibility manipulation for the Bolsa Família (Family Stipend) program during this time period. The program assists families with a monthly per capita income of around R$120.00 (US$60.00). By applying the tests developed by McCrary (2008), we find suggestive evidence that individuals manipulate their income by voluntarily reducing their labor supply in order to become eligible to the program. Moreover, the reduction in labor supply is greater among women, especially single or divorced mothers. This evidence raises some concern about the unintended consequences related to the eligibility criteria utilized by Bolsa Família, as well as the program's impact on individuals living in extreme poverty..

Suggested Citation

  • Sergio Firpo & Renan Pieri & Euclides Pedroso Jr. & André Portela Souza, 2014. "Evidence of eligibility manipulation for conditional cash transfer programs," Economia, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics], vol. 15(3), pages 243-260.
    • Handle: RePEc:anp:econom:v:15:y:2014:3:243_260
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    2. Bazzi, Samuel & Sumarto, Sudarno & Suryahadi, Asep, 2015. "It's all in the timing: Cash transfers and consumption smoothing in a developing country," Journal of Economic Behavior & Organization, Elsevier, vol. 119(C), pages 267-288.
    3. Barrientos, Armando & Debowicz, Darío & Woolard, Ingrid, 2016. "Heterogeneity in Bolsa Família outcomes," The Quarterly Review of Economics and Finance, Elsevier, vol. 62(C), pages 33-40.
    4. Nawaz, Saima & Iqbal, Nasir, 2021. "How cash transfers program affects environmental poverty among ultra-poor? Insights from the BISP in Pakistan," Energy Policy, Elsevier, vol. 148(PB).
    5. Gibran da Silva Teixeira & Giácomo Balbinotto Neto & Pedro Henrique Soares Leivas, 2020. "Evidence on Rule Manipulation and Moral Hazard in the Brazilian Unemployment Insurance Program," International Journal of Social Science Studies, Redfame publishing, vol. 8(1), pages 67-78, January.
    6. Pinto, Thiago L.S. & Tabak, Benjamin Miranda & Cajueiro, Daniel O., 2023. "How politics can influence the allocation of social program benefits: A case study of the Brazilian poverty reduction program Bolsa Família," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 77-89.
    7. Awaworyi Churchill, Sefa & Iqbal, Nasir & Nawaz, Saima & Yew, Siew Ling, 2021. "Unconditional cash transfers, child labour and education: theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 186(C), pages 437-457.
    8. Yörük, Erdem & Öker, İbrahim & Şarlak, Lara, 2019. "Indigenous unrest and the contentious politics of social assistance in Mexico," World Development, Elsevier, vol. 123(C), pages 1-1.
    9. Samir Cury & Euclides Pedrozo, 2016. "Cash Transfer Policies, Taxation and the Fall in Inequality in Brazil An Integrated Microsimulation-CGE Analysis [equilibrium model, microsimulation model, Brazil. Classification-JEL: C68, D58, I38," International Journal of Microsimulation, International Microsimulation Association, vol. 9(1), pages 55-85.
    10. Nawaz, Saima & Iqbal, Nasir, 2020. "The impact of unconditional cash transfer on fuel choices among ultra-poor in Pakistan: Quasi-experimental evidence from the Benazir Income Support Program," Energy Policy, Elsevier, vol. 142(C).

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    More about this item

    Keywords

    Conditional cash transfers; Brazilian Bolsa Família; Regression discontinuity; Eligibility manipulation;
    All these keywords.

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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