CCT's and Human Capital
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Jeppesen, Anders Gade1, Forfatter
Rand, John2, Vejleder
1Det Samfundsvidenskabelige Fakultet, Københavns Universitet, København, Danmark, diskurs:7001              
2Økonomisk Institut, Det Samfundsvidenskabelige Fakultet, Københavns Universitet, København, Danmark, diskurs:7014              
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Ukontrollerede emneord: Development economics, Economics of education, impact evaluation, Conditional Cash Transfer
 Abstract: Among the many challenges faced by developing countries, two of the cornerstones are to increase economic growth in the long run and reduce poverty in the short run. Standard policy options however, often seem to imply a trade-off between these two goals. Advocates of Conditional Cash Transfers (CCT’s) argue that this approach can effectively reach both goals at once. The transfers will alleviate poverty in the short term, if correctly targeted towards the poorest citizens. In the longer run poverty is to be reduced through making the transfers conditional on human capital enhancing behaviour such as attending school and receiving health check-ups for the families’ children.

This thesis presents what is currently known about the effectiveness of CCT’s in increasing human capital and discusses the theoretical framework for this approach to work.

The main part uses census data as well as school records of nationwide tests, to evaluate the effectiveness of Brazil’s CCT program Programa Bolsa Família (PBF) on increasing human capital with respect to years of completed schooling, actual learning as measured by test scores, and wages. Level of exposure to PBF is an effect of cohort of birth and municipality level residence in the school years. Although identification of a causal effect is complicated by the non-random nature of PBF intensity, by combining these two dimensions of differences in treatment intensity the endogeneity of PBF allocation due to unobserved level effects are implicitly dealt with. Estimates suggest that years of schooling and wages are positively impacted.

Acknowledging that these estimates could be caused by some omitted variable a falsification tests are carried out assigning “placebo” PBF intensities to cohorts that were not affected by PBF due to their age at the implementation of the program. Several of these cohorts are estimated to be positively affected by PBF, which suggests that claiming a causal interpretation of the estimates in the main section might not be warranted. A few possible mechanisms are discussed and analysed, but no specification fully removes the significant effect from the cohorts that should not have been affected. Although this implies that the no certainty can be assigned to the causal nature of the effect, it is noteworthy that the estimates for the cohorts that should be affected are much larger than those that were not.

As increasing quantity of education does not by itself guarantee increased human capital a section is devoted to analyse the effect of PBF on actual learning as measured by nationwide test scores. Identifying a causal effect in this setting is severely made more difficult by the fact that tests are only carried out for those attending school. As PBF has an effect on attendance, the composition of classrooms changes accordingly. Econometric analyses imply that the average test score is negatively affected by PBF for 4th grade while no effect is estimated in the preferred specification for 8th grade. Comparing these findings to regressions showing that the average level of education for students’ parents is lower as an effect of PBF, reveals that the negative effect on average test scores for 4th grade is partly or fully explained by the changing compositions of the classrooms. The missing effect on average test scores for 8th grades suggest that learning is positively affected by PBF.
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Bogmærk denne post:
 Type: Speciale
Alternativ titel: An Evaluation of Brazil's Bolsa Familia on Final Educational Outcomes
Alternativ titel: En evaluering af Brasiliens Bolsa familia på endelige uddannelsesmæssige variable
Alternativ titel: CCT programmer og human kapital
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Sprog: English - eng
 Datoer: 2013-08-05
 Sider: -
 Publiceringsinfo: København : Københavns Universitet
 Indholdsfortegnelse: -
 Note: -
 Type: Speciale
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