The Political Paradox of Cash Transfers

By Justin Sandefur , Nancy Birdsall and Mujobu Moyo

This study examines the educational impacts of a community-implemented conditional cash transfer pilot targeted at low-socioeconomic-status households in Tanzania.  

• Overall Impact: Cash transfers significantly increased children's school participation (by 8 to 10 percentage points) and primary school completion rates (by 14 to 16 percentage points).  

• Distribution of Gains: Benefits are not distributed uniformly across all demographics:  

  • Children from the lowest-income households experience greater gains along the extensive margin (a higher likelihood of ever attending school), whereas slightly better-off peers see greater gains along the intensive margin (a higher likelihood of completing primary school).  

  • Educational progress is heavily concentrated among students who demonstrated stronger academic performance at baseline.

  • Boys and girls benefit roughly equally, whereas orphans experience smaller improvements in school participation compared to non-orphans.  

• Conclusion: While safety net programs powerfully boost educational access, conditions alone do not overcome all barriers equally, indicating that policymakers need an array of complementary interventions to achieve universal enrollment for the most vulnerable children.  

  
  

Read the full article here:

https://www.cgdev.org/blog/political-paradox-cash-transfers