Measuring the effect of the disbursement mechanism for paying a government cash transfer in Chile, on eligible workers labour market and economic outcomes.

Last registered on December 01, 2020

Pre-Trial

Trial Information

General Information

Title
Measuring the effect of the disbursement mechanism for paying a government cash transfer in Chile, on eligible workers labour market and economic outcomes.
RCT ID
AEARCTR-0006574
Initial registration date
December 01, 2020

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
December 01, 2020, 1:25 PM EST

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
Experimental Policy Unit - Chilean Budget Office

Other Primary Investigator(s)

PI Affiliation
Chilean Budget Office
PI Affiliation
World Bank

Additional Trial Information

Status
In development
Start date
2021-01-03
End date
2022-12-31
Secondary IDs
Abstract
Cash transfer programs are one of the most widely adopted approaches to poverty relief across the globe, especially in Latin America. While research has examined the impacts of cash transfer program eligibility and benefit generosity on the labor market, very few studies have investigated the implications of the payment modality. This paper investigates the impact of a change in the payment modality of Chile’s Asignación Familiar (AF) on labour market and economic outcomes. The AF is a monthly cash transfer provided to low-income workers in the formal sector. Traditionally, AF benefits have been paid to workers via employers, who are later reimbursed by the state. We use an experimental design to investigate the impacts of changing this payment modality to a “direct pay” model in which the state directly transfers monthly benefits to eligible workers. Although it is assumed that workers receive the full amount of the AF benefit, in practice employers may share the gains by capturing a portion of the benefit. Thus, the change in payment modality may have both direct and indirect effects on the share of AF benefits eligible workers actually receive and possibly on their labor market behaviour.
External Link(s)

Registration Citation

Citation
Carranza, Eliana, Ryan Cooper and Leonardo González. 2020. "Measuring the effect of the disbursement mechanism for paying a government cash transfer in Chile, on eligible workers labour market and economic outcomes.." AEA RCT Registry. December 01. https://doi.org/10.1257/rct.6574
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Experimental Details

Interventions

Intervention(s)
The intervention is a change in the payment modality of the Asignación Familiar, a national cash transfer program for low-income formally employed workers in Chile. Currently, monthly AF benefits are paid to workers via employers, who are later reimbursed by the state. The proposed change in payment modality is a “direct pay” model in which the state directly transfers monthly AF benefits to eligible workers. The intervention thus removes firms from the AF payment process.
Intervention Start Date
2021-01-03
Intervention End Date
2021-12-31

Primary Outcomes

Primary Outcomes (end points)
Average wage or monthly salary
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Number of workers employed per firm
Monthly AF benefit deposit amount
Secondary Outcomes (explanation)
Monthly AF benefit deposit: the amount of AF monthly benefit actually deposited into eligible workers’ bank accounts (rather than the amount they are eligible for). This outcome measure depends on access to bank deposit data.

Additional information to be collected: indicators of workers’ exposure to COVID

Experimental Design

Experimental Design
A randomized experiment in which firms are randomly assign to a treatment group which implements the direct pay model or a control group which maintains the current employer-paid delivery model. All AF-eligible workers within a firm will receive the treatment assigned to their firm. Impacts will be evaluated at both the firm and worker level. We use administrative data to assess impacts of the treatment on key labor market outcomes.
Experimental Design Details
Not available
Randomization Method
Randomization done in office by computer.
Randomization Unit
The unit of randomization if the cluster (employer)
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
Approximately 5200 employers.
Sample size: planned number of observations
Approximately 30000 eligible workers.
Sample size (or number of clusters) by treatment arms
2600 employers in treatment group and 2600 employers in control group.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Using simulation method, the stratified randomization, impact measurement considering 2 periods (outcome baseline and one follow-up) and a power level of 0,86, detects 0.05 standard deviations. For the actual experimental analysis, it will be possible to use longitudinal data that can further increase statistical power.
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number