The Impact of Conditional Cash Transfer Programs on Educational Outcomes in Developing Countries. A Case Study: Bolsa Família in Brazil

Sammanfattning: Bolsa Família is one of the largest conditional cash transfer programs in the world. It provides cash transfers to poor households, conditional on human capital requirements such as minimum school attendance. The literature emphasizes that more schooling increases the human capital formation of children, which leads to improved employment outcomes and will break the inter-generational transmission of poverty. Despite the importance of schooling for poverty reduction, there is little evidence on Bolsa Família’s impact on children’s education. This thesis estimated the impact of Bolsa Família on school enrollment and literacy rates by using data from the Brazilian household survey PNAD 2014. A Regression Discontinuity Design was applied, and impacts were estimated by using logistic regressions. The results using the baseline sample suggest that Bolsa Família did not have any statistically significant effect on school enrollment for children between six and 17 years of age in 2014. However, when the initial assumptions were relaxed it was revealed that Bolsa Família’s effects on education were stronger among the poorest. This was attributed to higher school enrollment rates within this group. In addition, a heterogeneous treatment effect was found: the impact of Bolsa Família on school enrollment was larger among boys than girls, as well as, among younger children. Furthermore, the models suggest a lower chance of being literate for Bolsa Família beneficiaries. However, those results were not statistically significant and therefore no clear effect could be identified.