PROGRESA/Oportunidades

Project Overview:
Started in 1997, this ongoing program is the first nationwide controlled randomized anti-poverty program in a developing country to offer "conditional cash transfers" in order to promote incentives for positive behavior. The program offers transfers to poor families in Mexico conditional on their participation in health and nutrition programs (such as prenatal care, well-baby care and immunization, nutrition monitoring and supplementation, and preventive checkups), along with incentives to promote children's school attendance.

Households were surveyed at baseline to identify target communities and to select poor households within those communities. Villages were randomly phased into treatment, allowing researchers to identify the impact of transfers on a variety of child health and educational outcomes.

Main Results:
SEGA researchers have been involved in all aspects of the program, from the design phase to a series of completed and ongoing studies. Some major findings:

• The program made significant improvements in children's health. After 24 months in the program, treatment children aged 0-35 months at baseline experienced a reduction of 39.5 percent in illness rates relative to control children.
• Children born during the two-year intervention to families in the treatment group experienced an 25.3 percent lower illness rate in the first six months of life relative to control children.
• The effect of the program increases the longer the children stayed on the program, suggesting that program benefits are cumulative.
• Treatment children were 25.3 percent less likely to be anemic and grew about 1 centimeter more during the first year of the program.
• Economic shocks to household income are highly prevalent, and children's enrollment in school is highly sensitive to these shocks. Once taken out of school, children are 11 percent less likely to attend in the next semester (relative to a base enrollment rate of 81 percent. The conditional transfer largely or completely eliminates the shocks' effect on school enrollment.
• Child labor is also frequent and sporadic, and economic shocks have large effects on child work. The transfer only weakly mitigates the effect of shocks on child labor. This is likely due to the fact that the transfer, approximately 20 to 30 percent of household income every two months, was too small to prevent families from having children work in times of crisis.

SEGA Researchers:
Paul Gertler, Alain de Janvry, David Levine, Elisabeth Sadoulet

Academic Publications:

Alain de Janvry, Frederico Finan, Elisabeth Sadoulet, and Renos Vakis. Forthcoming. Can conditional cash transfer programs serve as safety nets in keeping children at school and from working when exposed to shocks? Journal of Development Economics.

Alain de Janvry and Elisabeth Sadoulet, Making Conditional Cash Transfer Programs More Efficient: Designing for Maximum Effect of the Conditionality, World Bank Economic Review, 2006, 20:1-29.

Alain de Janvry and Elisabeth Sadoulet. 2003. Depasser Bono: Comment rendre plus efficiente l'aide au développement. Revue-d'Économie-du-Développement. 0(4): 63-76.

Paul Gertler. 2004. Do Conditional Cash Transfers Improve Child Health? Evidence from PROGRESA's Control Randomized Experiment. American Economic Review (Papers and Proceedings) 94(2): 336-341.

Policy Papers:

Paul Gertler. 2000. Final Report: The Impact of PROGRESA on Health. International Food Policy Research Institute, Washington, D.C.

Working Papers:

Alain de Janvry, Frederico Finan, and Elisabeth Sadoulet. 2005. Using a Structural Model of Educational Choice to Improve Program Efficiency.

Alain de Janvry and Elisabeth Sadoulet. 2005. Making Conditional Cash Transfer Programs More Efficient: Designing for Maximum Effect of the Conditionality.

Paul Gertler and Simone Boyce. 2001. An Experiment in Incentive-Based Welfare: The Impact of PROGRESA on Health in Mexico.

In the News:

New York Times "Economic Scene" column Putting Development Dollars to Use, South of the Border, 2 May 2002