This study analyse how conditional cash transfers targeted at women affect household decision making and women's empowerment.
We study a policy intervention in the Republic of Macedonia, the Macedonian Conditional Cash Transfer (CCT) for Secondary School Education, offering cash transfers to poor households, conditional on having their children attending secondary school. The program is a social protection program aiming to increase secondary school enrolment and completion rates among children in the poorest households of the population. It was first implemented by the Macedonian Ministry of Labour and Social Policy (MLSP) in the Fall of 2010, and provided transfers to households conditional upon school-age children attending secondary school at least 85% of the time. The program was offered to beneficiaries of Social Financial Assistance (SFA), which is the largest income support program in Macedonia, accounting for around 0.5% of GDP, and 50% of total spending on social assistance (Verme, 2008). SFA is a mean-tested monetary transfer granted to people who are fit for work, who are socially not provided for, and who cannot support themselves. It is considered as the benefit of last resort, which means that it is provided if, after other benefits are taken-up, household income is still below a given threshold.
In this program, The gender of the recipients of the transfer was randomized, allowing payments to be received by either the mother of the child or the household head.3 The household head is the recipient of the SFA transfer, and is generally a male. Among SFA recipients, the household head is the male partner in 90% of non single-parent households, which represent 88% of SFA households. Randomization of the payment modality was done at the municipality level, after stratifying mu- nicipalities by population size. The 84 municipalities composing the Republic of Macedonia were first divided into 7 groups depending on population size, and then randomized into two groups, one of which has 42 municipalities and where the transfer is paid to the mother of the child, and the other which also has 42 municipalities and where the transfer is paid to the household head, regardless of gender.
The random allocation of the recipient of the payment allow studying different aspects of women's empowerment:
- First, using data collected to evaluate the conditional cash transfer program, we study how the gender of the recipient has an effect on the structure of expenditure shares. Focusing on food, different studies find that following an increase in total expenditure induced by a CCT transfer, households tend to allocate a larger share of total expenditures to food. This contradicts the usual assumption that food is a necessity, and therefore, that its share should decrease following an increase in total consumption. One possible explanation for this pattern is that the increase in food budget shares results from a change in control over household resources, which is induced by the transfer. The design of the CCT program and the richness of the expenditure data allow us to examine whether expenditure patterns on non-durable goods differ depending upon the gender of the recipient of the transfer.
- Secondly, we use a novel identification strategy to measure women's willingness to pay to receive cash transfers instead of their partner receiving it. We apply this using an incentive lab-setting among women living in poor households in urban Macedonia and selected to participate in the evaluation of the program. We match experimental data with the unique policy experiment introduced by the CCT program.