Ariel Fiszbein Chief Economist Human Development World Bank - PowerPoint PPT Presentation

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Ariel Fiszbein Chief Economist Human Development World Bank

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Title: Early Childhood Development in Latin America Author: nschady Last modified by: pallagi Created Date: 10/24/2005 4:23:12 PM Document presentation format – PowerPoint PPT presentation

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Title: Ariel Fiszbein Chief Economist Human Development World Bank


1
Ariel FiszbeinChief EconomistHuman
DevelopmentWorld Bank
2
Motivation
  • Many developing countries around the world have
    conditional cash transfer (CCT) programs in place
  • CCTs have shown positive results through credible
    impact evaluation studies source of their
    popularity
  • Focus on household behavior relevant for social
    policies in developed countries as well
  • Policy Research Report summarizes lessons of
    experience

3
Outline
  1. Present findings of report
  2. Discuss implications for social policy

4
The CCT revolution
5
The CCT Revolution
6
Motivation
  • Programs vary, but all share some basic
    characteristics
  • They transfer cash
  • They ask that households comply with a series of
    conditionsgenerally, school enrollment and
    attendance, often also attendance at health
    centers for young children
  • They are targeted to the poor
  • Twin objective promise of programs
  • Reduce current consumption poverty
  • Promote accumulation of human capital

7
A family of program approaches
8
CCT impacts on poverty
  • Message 1 CCTs have generally led to substantial
    reductions in consumption povertyin particular,
    when transfers are large
  • In Nicaragua, the Red de Protección Social, a
    pilot program, reduced the poverty gap among
    beneficiaries by 18 percent
  • In Mexico, PROGRESA (now Oportunidades), a
    program with national coverage, reduced the
    poverty gap in rural areas by 19 percent

9
Impacts on consumption and poverty
Mexico (1999) Nicaragua (2002) Colombia (2006) Honduras (2002)
Average transfer ( of per capita consumption) 20 30 13 11
Impact on per capita consumption () 8.3 20.6 10 7
Impact headcount index ( points) 1.3 5.3 2.9 --
Impact poverty gap ( points) 3.0 9.0 7.0 2.0
Impact sqd. poverty gap ( points) 3.4 8.6 2.2 2.0

10
CCT impacts on poverty
  • Why have CCTs reduced consumption poverty?
  • They are well-targeted
  • They have made transfers of (in some cases)
    substantial magnitude
  • They have not reduced adult labor market
    participation
  • They have not generally crowded out other
    transfers, and have not had substantial (local)
    general equilibrium effects
  • Transfers (which are generally made to women)
    have also changed the composition of consumption
  • More expenditures on food, and on higher-quality
    sources of calories

11
CCT impacts on food consumption
12
Impacts on health and education outcomes
  • Message 2 CCTs have resulted in substantial
    increases in the utilization of education and
    health services especially among poor
    households
  • Examples education
  • In Mexico, Oportunidades decreased dropout
    between 6th and 7th grade by 9 points
  • In Pakistan, the Punjab Education RSP increased
    the school enrollment of 10-14 year-old girls by
    11 points
  • In Cambodia, two pilot programs reduced the
    dropout between 6th and 7th grade by 20-30
    points
  • Examples health
  • In Colombia, Familias en Acción increased the
    proportion of children who had growth monitoring
    by 20-30 points
  • In Honduras, PRAF increased the proportion of
    children who had at least one preventive health
    visit by 20 points

13
Impacts on school enrollment

Age range Baseline enrollment Impact ( points) Size of transfer
Colombia 8-13 14-17 91.7 63.2 2.1 5.6 17
Chile 6-15 60.7 7.5 3-7
Ecuador 6-17 75.2 10.3 10
Mexico Grade 0-5 Grade 6 Grade 7-9 94.0 45.0 42.5 1.9 8.7 0.6 20
Nicaragua 7-13 72.0 12.8 30
Cambodia Grade 7-9 65.0 31.3 2
Pakistan 10-14 29.0 11.1 3
14
Impacts on health service utilization

Age range Baseline level Impact ( points) Size of transfer
Colombia lt24 months 24-48 months n.a. n.a. 22.8 33.2 17
Chile 0-6 years 17.6 2.4 7
Ecuador 3-7 years n.a. 2.7 10
Honduras 0-3 years 44.0 20.2 9
Mexico 0-3 years 69.8 8.4 20
Nicaragua 0-3 55.4 13.1 27
15
Impacts are concentrated on the poorest households
  • Example Nicaragua

16
Impacts on education and health outcomes
  • Message 3 Despite increase in service
    utilization, CCTs have had only mixed success in
    terms of improving final outcomes in education
    and health
  • Education
  • Increases in school enrollment and years of
    completed schooling have not come hand-in-hand
    with improved learning outcomes
  • Health
  • Some programs, but my no means all, have improved
    child nutrition (as measured by height-for-age,
    hemoglobin status)

17
CCT impact on child nutrition

Age range Baseline level Impact ( points) Size of transfer
Colombia lt24 months 24-48 months n.a. 0.16 0.01 17
Ecuador lt24 months 24-48 months -1.07 -1.12 -0.03 -0.06 10
Mexico 12-36 months n.a. 0.96 cm 20
Nicaragua lt60 months -1.79 0.17 27
Honduras lt72 months -2.05 -0.02 9
18
Impacts on child development (children age 3-6)
Nicaragua Ecuador (poorest 40) Ecuador (poorest 10)
Receptive language 0.223 (0.078) 0.011 (0.108) 0.177 (0.148)
Memory 0.092 (0.072) 0.192 (0.105) 0.228 (0.109)
Socio-emotional 0.067 (0.065) 0.150 (0.103) 0.389 (0.159)
Fine motor 0.150 (0.110) 0.160 (0.076) 0.288 (0.117)
Note all program impacts are in standard deviations. Note all program impacts are in standard deviations. Note all program impacts are in standard deviations. Note all program impacts are in standard deviations.
19
Outline
  1. Present findings of report
  2. Discuss implications for social policy

20
Designing transfers to maximize impact on human
development outcomes
  • Which behaviors should be targeted?
  • Quality of services what kind of services are
    beneficiaries of welfare programs actually
    receiving?
  • Incentives to service providers
  • Intermediation services
  • Conditioning on outcomes?
  • If under control of beneficiaries (e.g. STDs)
  • If combined with incentives to providers (e.g.
    learning outcomes)
  • Bonuses

21
Designing transfers to maximize impact on human
development outcomes
  • Change behaviors within households that prevent
    the accumulation of human capital.
  • Programs to improve parenting and early
    stimulation (as in the pláticas of
    Oportunidades or social-worker support as in
    Chile Solidario)
  • Targeting the right age group
  • Life-cycle skill formation as dynamic process
    (Heckman et al.)
  • Early stimulation and pre-school programs

22
Why condition?
  • Economic justifications
  • Persistently misguided beliefs
  • Incomplete altruism
  • Externalities
  • Political economy justifications
  • Greater support for a program that appears to ask
    beneficiaries to do something to help
    themselves
  • CCTs as new contract between the state and
    beneficiaries. Emphasis on co-responsibilities
    not conditions
  • Research on social perceptions (e.g. Brazilian
    press, Argentina opinion polls)

23
Do conditions work?
  • Conditions do play a role in increasing service
    use beyond income effect (at least in education)
  • Mexico Children in households w/o monitoring
    5.4 points less likely to enroll in school
  • Ecuador Program effects are only significant for
    households that believed transfer are
    conditional
  • Cambodia Program has no effect on enrollment for
    siblings at other levels

24
Avoiding negative effects of transfers
  • Why didnt CCTs have negative effects on labor
    supply?
  • Leisure effect low b/c of fine targeting
  • Avoided high marginal tax rates by use of
    proxy-means and infrequent update
  • Design options
  • Time limits (Chile)
  • Graduated benefits (Brazil)
  • Combining with other programs (e.g. workfare)

25
Institutional Issues
  • CCTs have had important institutional legacies
  • CCTs have led the way in the design of well-run
    administrative structures for beneficiary
    selection, payments, transparency
  • CCTs have been groundbreaking in terms of the
    importance they have paid to impact evaluation
    with credible counterfactuals

26
END
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