Family Networks, Schooling Outcomes and Investment in Mexico
Last registered on June 03, 2016

Pre-Trial

Trial Information
General Information
Title
Family Networks, Schooling Outcomes and Investment in Mexico
RCT ID
AEARCTR-0001232
Initial registration date
June 03, 2016
Last updated
June 03, 2016 11:50 AM EDT
Location(s)
Region
Primary Investigator
Affiliation
University College London (UCL)
Other Primary Investigator(s)
PI Affiliation
Duke University
PI Affiliation
Stanford University
PI Affiliation
University of Arizona
Additional Trial Information
Status
Completed
Start date
1997-10-01
End date
2003-11-30
Secondary IDs
Abstract
We present evidence on whether and how a household’s behavior is influenced by the presence and characteristics of its extended family. Using data from the PROGRESA program in Mexico, we exploit information on the paternal and maternal surnames of heads and spouses in conjunction with the Spanish naming convention to identify the inter- and intra-generational family links of each household to others in the same village. We then exploit the randomized research design of the PROGRESA evaluation data to identify whether the treatment effects of PROGRESA transfers on secondary school enrolment vary according to the characteristics of extended family. We find PROGRESA only raises secondary enrolment among households that are embedded in a family network. Eligible but isolated households do not respond. The mechanism through which the extended family influences household schooling choices is the redistribution of resources within the family network from eligibles that receive de facto unconditional cash transfers from PROGRESA, towards eligibles on the margin of enrolling children into secondary school.
External Link(s)
Registration Citation
Citation
Angelucci, Manuela et al. 2016. "Family Networks, Schooling Outcomes and Investment in Mexico." AEA RCT Registry. June 03. https://www.socialscienceregistry.org/trials/1232/history/8604
Experimental Details
Interventions
Intervention(s)
PROGRESA is an ongoing, publically funded social assistance program in Mexico designed to alleviate poverty by providing cash transfers to households conditional on their children’s primary and secondary school attendance. We sought to explore how families living in the same village in rural Mexico share resources. PROGRESA offered the conditional cash transfer program to 320 randomly assigned villages, while the remaining 186 villages served as the comparison group. We documented the paternal and maternal surnames of household heads and their spouses across these 506 villages in total, covering 22,000 families and about 130,000 individuals. Relying on Mexico’s unique naming convention, we were able to identify inter-generational links, (e.g. between the head of household and their parents) and intra-generational links (e.g. between the head of household and their siblings) within villages to determine if other members of a household’s extended family lived in the same village.
Intervention Start Date
1998-05-01
Intervention End Date
1999-11-30
Primary Outcomes
Primary Outcomes (end points)
- Secondary school enrollment (2010 paper)
- Consumption patterns (2015 paper)
- Investment patterns (2015 paper)
Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
We exploit three key data features. First, we combine information on the paternal and maternal surnames of household heads and their spouses, with the Spanish naming convention to build two types of extended family link within the same village — (i) inter-generational links, such as those from the head and spouse to their parents, and to their adult sons and daughters; (ii) intra-generational links, such as those from the head and spouse to their brothers and sisters. Combined with information from household rosters that identify extended family members that co-reside in the household, this provides an almost complete mapping of extended family structures across 506 villages, covering around 22,000 households and over 130,000 individuals.

Second, we exploit the multiple components of PROGRESA, each of which provides cash transfers conditional on a different household behavior. One component provides cash transfers conditional on the attendance of children in primary and secondary school. However, as preprogram initiation primary school enrolment rates are above 90%, transfers provided for this purpose represent a de facto unconditional cash transfer for households with primary school aged children. In contrast pre-program secondary enrolment rates are 65% so that for many households cash transfers will be obtained only if a change in behavior is induced. This is important because the value of transfers only corresponds to between one half to two thirds of the full time child wage in the survey villages [Schultz 2004], and so do not fully compensate for foregone earnings of secondary school aged children employed full time in the labor market. Hence if households are credit constrained, PROGRESA’s effect on secondary enrolment may be a function of the presence of primary school aged children, who receive de facto unconditional transfers. In particular, households can use these transfers to supplement those specifically conditioned on secondary school enrolment, thus fully offsetting the opportunity costs of enrolling children into full time secondary school. This channel affects both connected and isolated households. In addition, if families share resources, and in particular they share the unconditional transfers obtained from the primary school component of PROGRESA, the response of connected households will also depend on the demographic composition of eligible households within their family network. This drives a wedge between the program responses of connected and isolated households in terms of secondary enrolment.

Third, we exploit the randomized research design used to evaluate PROGRESA. Of the 506 sampled villages, 320 were randomly assigned to be a treatment group, namely villages where PROGRESA would be implemented, and 186 villages were controls. Data was collected on a panel of around 22,000 households every six months over the pre and post-program initiation periods. In each village the baseline survey provides a complete census of all eligible and all non-eligible households. Under standard assumptions this research design identifies the average treatment effect of PROGRESA from a comparison of eligibles in treatment and control villages. The core of our analysis identifies whether this treatment effect varies across connected and isolated households.

The 2015 paper combines both insights by studying whether extended family networks pool resources and thus help network members: (i) smooth consumption against idiosyncratic income risk; (ii) relax credit constraints, enabling additional investments to be undertaken. In this paper we first develop a stylized framework to make precise how consumption and investment decisions are interlinked for households subject to idiosyncratic income shocks and imperfect credit markets. We do so for two types of household: those we describe as being connected because they are embedded within an extended family network that pools resources among its members, and those that are isolated and have none of their family members in close geographic proximity and therefore have to self-insure. This simple framework demonstrates how relative to isolated households, family networks can both insure their members against consumption risk and relax credit constraints member households face in investment choices. We are also able to study the long run impacts of positive resource inflows by exploiting a final wave of data from November 2003, some five years after households first experience receipt of transfers. This allows us to provide insights on whether the increased capacity of family networks to insure against income risk and relax credit constraints leads to sustained increases in consumption and investment outcomes for network members relative to isolated self-insuring households.
Experimental Design Details
Randomization Method
N/A since data was not collected by researchers
Randomization Unit
Village
Was the treatment clustered?
Yes
Experiment Characteristics
Sample size: planned number of clusters
506 villages (2010 paper)
503 villages (2015 paper)
Sample size: planned number of observations
22,553 households (2010 paper); 14,440 households (2015 paper)
Sample size (or number of clusters) by treatment arms
treatment group: 320 villages; control group: 186 villages (2010 paper)
treatment group: 320 villages; control group: 183 villages (2015 paper)
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB
INSTITUTIONAL REVIEW BOARDS (IRBs)
IRB Name
University of Chicago
IRB Approval Date
2006-07-27
IRB Approval Number
H06182
IRB Name
Stanford University
IRB Approval Date
2008-09-15
IRB Approval Number
349 (Panel: 2)
Post-Trial
Post Trial Information
Study Withdrawal
Intervention
Is the intervention completed?
Yes
Intervention Completion Date
November 30, 1999, 12:00 AM +00:00
Is data collection complete?
Yes
Data Collection Completion Date
November 30, 2003, 12:00 AM +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
506 villages (2010 paper)
503 villages (2015 paper)
Was attrition correlated with treatment status?
No
Final Sample Size: Total Number of Observations
17,030 households (2010 paper)
14,440 households (2015 paper)
Final Sample Size (or Number of Clusters) by Treatment Arms
2010 paper: treatment group: 320 villages (with 10,559 households); control group: 186 villages (with 6,471 households) 2015 paper: treatment group: 320 villages (with 10,426 households); control group: 183 villages (with 4,014 households)
Data Publication
Data Publication
Is public data available?
No
Program Files
Program Files
Reports and Papers
Preliminary Reports
Relevant Papers
Abstract
This paper links two ideas in development economics: (i) extended families are a key institution through which households insure against idiosyncratic risk; (ii) a defining feature of households in agrarian economies is the interlinkage between their consumption and investment/ production decisions. We exploit the Progresa experimental evaluation data, in which extended family networks can be identified and households are subject to exogenous resource increases, to document that family networks pool resources to both insure their members against consumption risk and relax credit constraints members face in undertaking non-collateralizable investments. On consumption, we document that for every dollar that accrues to the family network, food consumption expenditures increase by 60-70c/ for both households eligible for Progresa transfers and ineligible members of the same family network. Hence the marginal propensity of families to invest/save out of every dollar is around .2-.3, and we document how this is pooled with other family resources to ease credit constraints eligible network members face in financing non-collateralizable investments into their children’s human capital. Finally, we show these consumption and investment benefits of being embedded within an extended family network are sustained five years after households first experience resource transfers from Progresa. Hence the interplay between resource inflows and resource pooling by family networks places them on sustained paths out of poverty.
Citation
Angelucci, Manuela, Giacomo de Giorgi, and Imran Rasul. "Resource Pooling within Family Networks: Insurance and Investment." Working Paper, November 2015.
Abstract
We present evidence on whether and how a household’s behavior is influenced by the presence and characteristics of its extended family. Using data from the PROGRESA program in Mexico, we exploit information on the paternal and maternal surnames of heads and spouses in conjunction with the Spanish naming convention to identify the inter- and intra-generational family links of each household to others in the same village. We then exploit the randomized research design of the PROGRESA evaluation data to identify whether the treatment effects of PROGRESA transfers on secondary school enrolment vary according to the characteristics of extended family. We find PROGRESA only raises secondary enrolment among households that are embedded in a family network. Eligible but isolated households do not respond. The mechanism through which the extended family influences household schooling choices is the redistribution of resources within the family network from eligibles that receive de facto unconditional cash transfers from PROGRESA, towards eligibles on the margin of enrolling children into secondary school.
Citation
Angelucci, Manuela, Giacomo de Giorgi, Marcos A. Rangel, and Imran Rasul. 2010. "Family Networks and School Enrolment: Evidence from a Randomized Social Experiment." Journal of Public Health Economics 94:197-221.