The Long-Run Effects of Conditional Cash Transfers

Working Paper 2025-684

Abstract

Conditional Cash Transfers (CCTs) have become a key antipoverty policy in Latin America inthe last 25 years. The ultimate goal of this kind of programs is to break the intergenerationaltransmission of poverty through the promotion of human capital accumulation of children invulnerable households. In this paper, we explore this issue by estimating the long-run effectsof the largest CCT in Latin America: the Brazilian Bolsa Familia. Through a combinationof the two-stage-two-sample method and a difference-in-differences approach, we find evidenceconsistent with a positive long-run impact of Bolsa Familia among former beneficiaries. Inparticular, we find a significant positive effect on education and labor income, and a negativeeffect on the likelihood of being a current beneficiary of this social transfer.

Authors: Guido Neidhofer, Luis Laguinge, Leonardo Gasparini.