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Household Responses to Cash Transfers

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  • Bram De Rock
  • Tom Potoms
  • Denni Tommasi

Abstract

This paper exploits the experimental setup of the cash transfer program PROGRESA (Programa de Educacion, Salud y Alimentacion) in rural Mexico to estimate a collective model of the household in order to investigate how parents allocate household resources. We show that household decisions are compatible with the testable implications of the collective model, based on so-called distribution factors, at the beginning of the program but reject them later on. We discuss a number of possible explanations for these findings and provide several arguments, consistent with our model, suggesting that this rejection may indicate that the treatment is not only empowering women but also possibly changing individual preferences.

Suggested Citation

  • Bram De Rock & Tom Potoms & Denni Tommasi, 2022. "Household Responses to Cash Transfers," Economic Development and Cultural Change, University of Chicago Press, vol. 70(2), pages 625-652.
    • Handle: RePEc:ucp:ecdecc:doi:10.1086/713539
    DOI: 10.1086/713539
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    Cited by:

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    2. Jos'e Alfonso Mu~noz-Alvarado, 2023. "Power to the teens? A model of parents' and teens' collective labor supply," Papers 2307.09634, arXiv.org.
    3. Tommasi, Denni, 2019. "Control of resources, bargaining power and the demand of food: Evidence from PROGRESA," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 265-286.
    4. Gast'on P. Fern'andez, 2023. "Does personality affect the allocation of resources within households?," Papers 2307.02918, arXiv.org.
    5. José L. Casco, 2024. "Intra-household resource shares under poverty transfers: evidence from Ecuador," Review of Economics of the Household, Springer, vol. 22(3), pages 1243-1274, September.
    6. Shubhangi Agrawal & Sambit Bhattacharyya & Chirantan Chatterjee & Somdeep Chatterjee, 2024. "Income shock and Women’s Health Spending:Evidence from India," Working Paper Series 1324, Department of Economics, University of Sussex Business School.

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    More about this item

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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