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Household Responses to cash Transfers

Denni Tommasi

Working Papers ECARES from ULB -- Universite Libre de Bruxelles

Abstract: This paper estimates a collective model of the household and investigates how parents reach decisions to allocate household resources. Using data from PROGRESA, we test the restrictions of collective rationality on a large variety of specifications and show that, contrary to previous results, this modeling approach cannot rationalize the household decision process. We provide some evidence that the observed inefficiency is driven by the group receiving the cash transfers. These results are consistent with the idea that a possible indirect effect of CCT programs may be to enhance disagreements between the spouses which trigger an inefficient allocation of their resources.

Keywords: collective model; bargaining power; efficiency; PROGRESA; conditional cash transfers (search for similar items in EconPapers)
JEL-codes: D13 I38 J12 J16 O15 (search for similar items in EconPapers)
Pages: 52 p.
Date: 2016-05
New Economics Papers: this item is included in nep-dev and nep-lab
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Working Paper: Household Responses to Cash Transfers (2017) Downloads
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