Do conditions imposed by Conditional Cash Transfers (CCTs) influence the outcomes they seek to improve? This paper presents the results of a randomized experiment in rural Burkina Faso to estimate the impact of conditional and unconditional cash transfers on education. The study of the two-year pilot programme found that unconditional and conditional cash transfers had a similar impact in increasing the school enrolment of children who are traditionally favoured by parents for school participation. However, the conditional transfers were significantly more effective in improving the enrolment of ‘marginal’ children, such as girls, younger children, and lower ability children.In addition, CCTs were estimated to be more cost-effective than unconditional transfers in improving enrolment.
The two-year pilot programme randomly distributed cash transfers that were either conditional or unconditional. Families under the conditional schemes were required to have their children ages 7–15 enrolled in school and attending classes regularly. There were no such requirements under the unconditional programs. Findings include the following:
- With yearly transfer amounts of $17.6 for children ages 7-10 and $35.2 for children ages 11-15, CCTs led to statistically significant increases in enrolment of 20.3 percent for girls, 37.3 percent for younger children, and 36.2 percent for low ability children relative to mean enrolment in those sub-groups. For these same categories of marginal children, UCTs either had no statistically significant impact or showed an impact that was significantly smaller than the CCT effect.
- UCTs and CCTs have similar impacts in increasing the enrolment of children who are already enrolled at baseline or are traditionally prioritised by parents for school participation, including boys, older children, and higher ability children. The study found enrolment increases due to CCTs and UCTs respectively of 21.8 and 22.2 percent for boys, 17.4 and 14 percent for older children, and 27.0 and 28.5 percent for higher ability children.
- In addition, estimates indicated that CCTs (despite their higher administrative costs) are more cost-effective at improving enrolment, particularly for marginal children.
The policy implications emerging from the results are as follows:
- If the policy objective is to increase overall school enrolment, UCTs might have comparable effects to CCTs. Since CCT programmes are generally significantly more costly to administer per recipient than UCT programmes, due to the expenses associated with monitoring that the conditions are met, UCTs are generally assumed to be more cost-effective under that objective. However, this is not what this study found.
- If the policy objective also includes an emphasis on improving the enrolment and educational outcomes of categories of children who are less likely to be part of the education system, then CCTs are likely to have larger impacts and be more cost-effective.
- CCTs can be implemented and be effective in an environment with limited administrative capacity. The pilot cash transfer programme relied on existing government structures and was implemented in an environment where there is no systematic population registration and where formal banking is almost non-existent.