Paper short abstract:

This paper examines the impact of Bono Juancito Pinto (BJP) on schooling and child labour. Results indicate that BJP increased the likelihood of school enrolment but has no sizeable effect on the incidence of child labour.

Paper long abstract:

In this paper, we investigate the schooling and labour market impacts of Bolivia's Bono Juancito Pinto (BJP). Different from other cash transfer programmes in Latin America, BJP does not follow a strict poverty targeting mechanism, but instead, is nearly universal in its coverage, as it covers

90 per cent of school-age children that are enrolled in public schools.

The programme began in 2006, providing income support of 200 Bolivianos per year (about $25 USD) to children enrolled in grade 1 to 5 of primary school. In subsequent years the government gradually expanded its coverage to include children in secondary education, raising the number of beneficiaries from nearly 1.1 million of school-age children in 2006 to 2,1 million in 2014.

Using data from the Bolivian National Living Standards Survey, we exploit the exogenous variation in the timing of the announcement of the programme expansion, as well as the age eligibility criteria, for identification. More specifically, we resort to difference- in-differences estimators to measure the effect of the programme on schooling and the incidence and intensity of child labour. Overall, we find evidence of a positive and significant effect of BJP on schooling decisions, although the effect is largely driven by children living in rural areas, particularly girls. However, We found no evidence of sizeable programme effects on labour market outcomes, which we attribute, at least partly, to the small size of the transfer, and the structure of the labour market and the school system in Bolivia.