Designing Cost-Effective Cash Transfer Programs To Boost Schooling among Young Women in Sub-Saharan Africa

As of 2007, 29 developing countries had some type of Conditional Cash Transfer (CCT) program in place, with many others planning or piloting one. However, the evidence base needed by a government to decide how to design a new CCT program is severely limited in a number of critical dimensions. We present one-year schooling impacts from a CCT experiment among teenage girls and young women in Malawi, which was designed to address these shortcomings: conditionality status, size of separate transfers to the schoolgirl and the parent, and village-level saturation of treatment were all independently randomized. We find that the program had large impacts on school attendance: the re-enrollment rate among those who had already dropped out of school before the start of the program increased by two and a half times and the dropout rate among those in school at baseline decreased from 11% to 6%. These impacts were, on average, similar in the conditional and the unconditional treatment arms. While most schooling outcomes examined here were unresponsive to variation in the size of the transfer to the parents, higher transfers given directly to the schoolgirls were associated with significantly improved school attendance and progress – but only if the transfers were conditional on school attendance. We find no spillover effects within treatment communities after the first year of program implementation. Policymakers looking to design cost-effective cash transfer programs targeted towards young women should note the relative insensitivity of these short-term program impacts with respect to conditionality and total transfer size. JEL Codes: I21, O12, C93 1 Baird is at George Washington University, McIntosh at UC San Diego, and Özler at the World Bank. Please send correspondence to [email protected]. We gratefully acknowledge funding from the Global Development Network, the Bill and Melinda Gates Foundation, the Knowledge for Change Trust Fund (TF090932), World Development Report 2007 Small Grants Fund (TF055926), and Spanish Impact Evaluation Fund (TF092384). The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not nec essarily represent the views of the International Bank for Reconstruction and Development or the World Bank.