Paper short abstract:

This article provides an empirically grounded analysis of the Bono de Desarrollo Humano programme and the politics of exclusion associated with its targeting scheme. Furthermore, it simulates various universal and targeted designs that the BDH could adopt in a context of limited fiscal resources.

Paper long abstract:

Conditional cash transfers (CCTs) marked a transition away from universal and collective social protection schemes towards targeted and individualised regimes. As originally designed, CCTs were conceived as limited interventions with the ultimate objective of securing a permanent way out of poverty, i.e. graduation. Such an emphasis on targeting and graduation has been attributed to constraints related to external financial conditions, e.g. donor support, or pressure on social protection budgets. It is often argued that in a context of limited fiscal resources, narrowly targeted social protection programmes are more effective in reducing poverty than universal alternatives. Yet, perfect targeting is uncommon. Proxy-means tests—the preferred targeting modality in developing countries—are plagued with exclusion errors. Small errors, gaps and biases in data collection and modelling can lead to significant biases in access to social protection programmes. And given their statistical complexity, beneficiaries are unable to decode the technicalities that determine their participation in these programmes. This article provides an empirically grounded analysis of the Bono de Desarrollo Humano (BDH) programme in Ecuador, flagging the politics of exclusion associated with narrow targeting modalities. Based on detailed tax-benefit microsimulation techniques allowing to assess the extent of income protection provided by the BDH, the central argument is that proxy-means tests lack transparency and limit the agency of beneficiaries, deepening processes of exclusion. Furthermore, the article presents various institutional alternatives modelled for the Ecuadorian context, considering both targeted and universal modalities, that the BDH could adopt to expand citizenship rights within the current fiscal constraints.