Dynamic treatment effects: the case of Progresa/Oportunidades program

Available from: 
October 2013
Paper author(s): 
Hector Sandoval (University of Wisconsin-Madison)
Wallice Ao (University of Wisconsin-Madison)
Ying-Ying Lee (University of Wisconsin-Madison)
Topic: 
Poverty - Inequality - Aid Effectiveness
Year: 
2013


This paper studies the dynamic treatment effects of Mexico''s cash transfer program Progresa/Oportunidades by providing a dynamic analysis for the effects of the program as a sequence of interventions. We construct a rich panel of dataset which covers six waves of surveys, from 1997 to 2007. By exploiting the comprehensive information provided by our panel, we extend the methods developed in Lechner and Miquel (2009, Empirical Economics) to identify and estimate dynamic forms of treatment effects by a sequential randomization assumption, which is well-supported by the construction of the program. This novel approach allows us to provide new insights to the performance of the program. One of the main contributions of this paper is to give suggestions as to what the optimal amount of treatment (participation time and amount of transfer) for a household should be, conditional on their characteristics. Therefore, our results provide a rigorous evaluation of the Progresa/Oportunidades over time and provide policy-relevant suggestions to enhance the effectiveness of this program.

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Research section: 
Lacea 2013 annual meeting
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