CREDIT Seminar: Marina Palma (Erasmus Rotterdam)

Title:  How and when: Cash and care effect of conditional cash transfers on birth outcomes (with Fernando Mattar and Cecilia Machado)

Abstract: While conditional cash transfers are a powerful tool to alleviate poverty and improve many short-run socioeconomic outcomes of targeted families, very little is known about how and when these programs improve in utero conditions of babies. Moreover, there is scarce evidence on whether additional transfers to already eligible families can improve outcomes at birth. This paper fills these two gaps by exploring quasi-random income variation on one of the world’s largest CCT programs – the Bolsa Família in Brazil – taking advantage of sharp eligibility criteria that are due to birth dates of family members. Overall, additional cash transfers to women reduce preterm birth by 10 per cent, with increased prenatal care as a potential mechanism for the results. The effects appear mainly for transfers that occur in the third trimester of pregnancy. For transfers in the first trimester of pregnancy, we find worse birth outcomes for our treatment families pointing at survival effects. Our findings speak to the role complementarity between prenatal care and family income in producing health at birth: even small amounts of cash transfers can be effective in improving birth outcomes when coupled with adequate prenatal care.