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The long-term effects of cash transfer programmes on young adults' mental health: a quasi-experimental study of Colombia, Mexico, and South Africa

Author

Listed:
  • Zimmerman, Annie
  • Avendano, Mauricio
  • Lund, Crick
  • Araya, Ricardo
  • Diaz, Yadira
  • Ariza Sanchez, Juliana
  • Hessel, Philipp
  • Garman, Emily
  • Evans-Lacko, Sara

Abstract

Poverty is associated with poorer mental health in early adulthood. Cash transfers (CTs) have been shown to improve child health and education outcomes, but it is unclear whether these effects may translate into better mental health outcomes as children reach young adulthood. Using a quasi-experimental approach that exploits variation across countries in the timing of national CT programme introduction, we examine whether longer exposure to CTs during childhood (0–17 years) reduces depressive symptoms in early adulthood (18–30 years). Based on harmonized data from Colombia, Mexico, and South Africa (N = 14 431), we applied logistic regression models with country and birth-cohort fixed effects to estimate the impact of cumulative years of CT exposure on mental health, educational attainment, and employment outcomes. Our findings indicate that each additional year of CT exposure during childhood is associated with a 4% reduction in the odds of serious depressive symptoms in early adulthood [odds ratio (OR) = 0.96, 95% confidence intervals (CIs): 0.93, 0.98]. We find no consistent effect of years of exposure on completion of secondary school (OR = 1.01, 95% CIs: 0.99, 1.03) and a negative effect on the probability of employment in early adulthood (OR = 0.90, 95% CIs: 0.88, 0.91). These results suggest that longer exposure to CTs may contribute to modest but meaningful reductions in population-level depressive symptoms during early adulthood.

Suggested Citation

  • Zimmerman, Annie & Avendano, Mauricio & Lund, Crick & Araya, Ricardo & Diaz, Yadira & Ariza Sanchez, Juliana & Hessel, Philipp & Garman, Emily & Evans-Lacko, Sara, 2025. "The long-term effects of cash transfer programmes on young adults' mental health: a quasi-experimental study of Colombia, Mexico, and South Africa," LSE Research Online Documents on Economics 125924, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:125924
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    References listed on IDEAS

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    1. Flávio Cunha & James Heckman, 2016. "Decomposing Trends in Inequality in Earnings into Forecastable and Uncertain Components," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages 31-65.
    2. Susan W Parker & Tom Vogl, 2023. "Do Conditional Cash Transfers Improve Economic Outcomes in the Next Generation? Evidence from Mexico," The Economic Journal, Royal Economic Society, vol. 133(655), pages 2775-2806.
    3. Cecchini, Simone & Atuesta, Bernardo, 2017. "Conditional cash transfer programmes in Latin America and the Caribbean: Coverage and investment trends," Políticas Sociales 42109, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
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