Conditional cash transfer programs and household labor supply

Employment correlates with the reduced risk of poverty. Through a randomized controlled trial, we evaluate the impact of a conditional cash transfer (CCT) program offered to low-income families with dependent children on household members’ labor supply. Recipients are required to attend labor-market-oriented mentoring courses as a condition for receiving the transfer. One year after admission to the program, fathers assigned to the CCT program are more likely to work (+14 percent) than fathers assigned to an unconditional cash transfer program or to a pure control group. No effect is observed for mothers. Results seem to be explained by improved family networks and increased investments, especially for fathers, in activities that enhance labor market opportunities.