Does Money Matter ? The Effects Of Cash Transfers On Child Health And Development In Rural Ecuador

Abstract

This brief summarizes the results of a gender impact evaluation study, entitled Does money matter? : the effects of cash transfers on child health and development in rural Ecuador, conducted in 2003 in Ecuador. The study observed the impact of government-run cash transfer program targeted to poor mothers in rural Ecuador on the health and development of their children on the child level. Relatively modest unconditional cash transfers raised the hemoglobin levels of the poorest children, improved fine motor control, improved cognitive outcomes, and led to a reduction in reported behavioral problems. Program effects on cognitive development were generally larger for girls than boys, and for children with more highly-educated mothers but differences by child gender are not big, and are precisely estimated. The implied program effects are much larger than will be expected from the cross-sectional elasticities of outcomes with respect to expenditures for households in the control group. The findings suggest that these gains may have been accomplished though better nutrition and the use of de-worming medication, although not through the use of growth monitoring check-ups and better parenting. Funding for the study derived from the Center for Economic and Policy Studies at Princeton University, the Government of Ecuador, and The World Bank.