Long-Term Effects of Prospera on Welfare

50 Pages Posted: 12 Sep 2019 Last revised: 13 Nov 2019

See all articles by Arturo A Aguilar

Arturo A Aguilar

Instituto Tecnológico Autónomo de México (ITAM)

Cristina Barnard

Instituto Tecnológico Autónomo de México (ITAM)

Giacomo De Giorgi

University College London; NBER; Federal Reserve Banks - Federal Reserve Bank of New York

Date Written: September 10, 2019

Abstract

The long-term effects of Mexico's conditional cash transfer program, PROSPERA, on poor households are of great interest to policy makers and academics alike. This paper analyzes the long-term effects on the welfare of the original participant households and their offspring, about 20 years after the inception of the program. To complement other studies that look into the effects on schooling and health, the analysis focuses on a utilitarian definition of welfare and employs two empirical strategies. The first uses the 1997-2000 experiment as the cleanest, albeit limited, source of variation. The analysis finds that by 2017?18, the offspring of original beneficiary households are more likely to have formed their own households, to have migrated to different localities, and to have more durable assets and larger consumption expenditures than their control counterpart. The second strategy confirms and expands those findings using a difference-in-difference methodology based on the localities' rollout of the program and the age of the individuals, as a proxy of exposure. This second approach covers a much larger and representative sample, while also directly observing self-reported vulnerability in food consumption. The findings confirm the generally positive outlook in terms of durable assets and lower food vulnerability. Perhaps more interestingly and relevant for evaluating the success of the program is that it improved intergenerational mobility. Using the 1997-2000 experiment, the analysis finds that the young adults who benefited from the program improved with respect to their parents in education, assets holding, and income. They appear to be climbing the ladder of assets and income.

Keywords: Health Care Services Industry, Educational Sciences, Inequality, Disability, Access of Poor to Social Services, Economic Assistance, Services & Transfers to Poor, Labor Markets

Suggested Citation

Aguilar, Arturo A and Barnard, Cristina and De Giorgi, Giacomo, Long-Term Effects of Prospera on Welfare (September 10, 2019). World Bank Policy Research Working Paper No. 9002, Available at SSRN: https://ssrn.com/abstract=3450898

Arturo A Aguilar (Contact Author)

Instituto Tecnológico Autónomo de México (ITAM) ( email )

Av. Camino a Sta. Teresa 930
Col. Héroes de Padierna
Mexico City, D.F. 01000, Federal District 01080
Mexico

Cristina Barnard

Instituto Tecnológico Autónomo de México (ITAM)

Av. Camino a Sta. Teresa 930
Col. Héroes de Padierna
Mexico City, D.F. 01000, Federal District 01080
Mexico

Giacomo De Giorgi

University College London ( email )

Gower Street
London
United Kingdom

NBER ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Federal Reserve Banks - Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

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