Income Gains to the Poor from Workfare: Estimates for Argentina's Trabajar Program

Abstract

A workfare program was introduced in response to high unemployment in Argentina. An ex-post evaluation using matching methods indicates that the program generated sizable net income gains to generally poor participants. Jalan and Ravallion use propensity-score matching methods to estimate the net income gains to families of workers participating in an Argentinian workfare program. The methods they propose are feasible for evaluating safety net interventions in settings in which many other methods are not feasible.

The average gain is about half the gross wage. Even allowing for forgone income, the distribution of gains is decidedly pro-poor. More than half the beneficiaries are in the poorest decile nationally and 80 percent of them are in the poorest quintile - reflecting the self-targeting feature of the program design. Average gains for men and women are similar, but gains are higher for younger workers. Women's greater participation would not enhance average income gains, and the distribution of gains would worsen. Greater participation by the young would raise average gains but would also worsen the distribution.

This paper - a product of Poverty and Human Resources, Development Research Group - is part of a larger effort in the group to improve methods for evaluating the poverty impact of Bank-supported programs.