A Comparative Study on the Conditional Cash Transfer Programs in Latin America and the Caribbean

Abstract

This thesis is a comparative case study of nationwide Conditional Cash Transfer (CCT) programs in Brazil, Colombia, Jamaica and Mexico. These four countries were chosen on the basis that each one of them have vastly different political, social and economic backgrounds yet all have implemented standardized CCT programs. The main reasons for employing CCT programs are the same and twofold: first, to create a safety net for the poor so that the cash transfer could alleviate some of the immediate effects of poverty

and second, to reduce the transmission of intergenerational poverty by promoting the accumulation of human capital development through improved education and health performances. In order to accomplish these feats, the CCTs impose specific health and education conditions upon program recipients in exchange for cash transfers. After the first generation of CCT programs yielded glowing international reviews, many Latin American countries rushed to adopt their own programs. As a result, the programs have become widespread in the region and demands for them show no signs of abating. The CCT programs attained positive short-term results as the stipends granted by the programs effectively soothed immediate effects of poverty such as starvation. Furthermore, the majority of recipients adhered to the health and educational conditions, which was a gain for certain factors such as increased enrollment rates. However, the long-term effects on poverty reduction are not so clear. Thus, the quick spread of CCT programs during the early 2000s may be more of a concern since the outcomes of the CCT programs may not correlate to advancements in human capital development, through education and health gains, as expected. This study is guided by the premise that the recipients of CCT programs in countries that hold at least an upper-middle income level will experience larger improvements in health and education performance than those from lower income levels. These differences in health and education outcomes appear despite the fact that the programs have been implemented similarly with standard conditionalities. To elaborate, an upper-middle income level is essential to guarantee the availability of adequate educational, health and financial resources in the country. This is because the lack of the necessary services will result in a negligible and disappointing outcome in terms of the health and education performances. Moreover, the availability of adequate resources should be pervasive within the country so that there are not large disparities amongst different regions.