Concept and origins
CCTs aim both to reduce current poverty through cash and to prevent future poverty by investing in children's education and health, an idea rooted in human capital theory. Levy (2006) explained that Progresa built rigorous evaluation into its design, helping it survive changes of government. Fiszbein and Schady (2009) documented its spread from Latin America to Asia and Africa.
Effects
Schultz (2004) found Progresa raised enrolment, especially in secondary school, and Gertler (2004) found reduced illness and greater height among children. Rawlings and Rubio (2005) and Lagarde and colleagues (2007) confirmed higher attendance and health service use, though effects on learning and long-term earnings are less clear.
The role of conditions
Baird, McIntosh and Özler (2011) found in Malawi that conditions raised schooling more, while unconditional cash reduced early marriage and teen pregnancy more. Critics note monitoring costs and the risk of excluding the poorest. The debate links to targeting, comparisons with workfare, and efforts to break the intergenerational poverty trap.
FAQ
- What are conditional cash transfers in simple terms?
- Governments give cash to poor families who send their children to school or attend health check-ups.
- Are conditions necessary?
- They raise school attendance, but unconditional cash performs better on some outcomes, so it is debated.
Sources reviewed: 2026-10-26
References
- Schultz, T. P. (2004). School subsidies for the poor: Evaluating the Mexican Progresa poverty program. Journal of Development Economics, 74(1), 199–250. The key evaluation of Progresa's schooling effects.
- Gertler, P. (2004). Do conditional cash transfers improve child health? Evidence from PROGRESA's control randomized experiment. American Economic Review, 94(2), 336–341. Randomised evidence on child health gains.
- Rawlings, L. B., & Rubio, G. M. (2005). Evaluating the impact of conditional cash transfer programs. The World Bank Research Observer, 20(1), 29–55. Reviews evaluations across countries.
- Lagarde, M., Haines, A., & Palmer, N. (2007). Conditional cash transfers for improving uptake of health interventions in low- and middle-income countries: A systematic review. JAMA, 298(16), 1900–1910. A systematic review of health service uptake.
- Levy, S. (2006). Progress against poverty: Sustaining Mexico's Progresa-Oportunidades program. Brookings Institution Press. The architect's account of design and political survival.
- Fiszbein, A., & Schady, N. (2009). Conditional cash transfers: Reducing present and future poverty. World Bank. The World Bank's comprehensive report.
- Baird, S., McIntosh, C., & Özler, B. (2011). Cash or condition? Evidence from a cash transfer experiment. The Quarterly Journal of Economics, 126(4), 1709–1753. Directly compares conditional and unconditional cash.