The genius of the CCTs in Mexico and in Brazil was not about how to get kids in school but rather about how to use the fact that almost all kids already were in school to generate welfare loss minimizing but nevertheless politically powerful symbolism to expand cash transfers. Many of these transfers were conditioned on the enrollment of children in age groups with near-universal enrollment. (In Brazil in 2001, for example, enrollment at ages 9–12 exceeded 95%.) As a strategy for getting kids into school, as a recent J-PAL note attests, this makes CCTs highly cost-ineffective. Does this make the transfers a silly giveaway or a political master stroke—maximizing the political symbolic value of a cash transfer while minimizing the burden on the recipients of conditions? Ask yourself: What did the designers think?
Miguel Székely, one of the designers of PROGRESA, writes, “The real underlying objective of external donors/investors in some circumstances might not be generating impact, but rather making the statement that they are supporting a particular cause. In such cases, the objective might well be a noble and legitimate one, and the measure of success will be the flow or resources itself, rather than its final impact, but neither the donor/investor nor the executor might have incentives to invest in evaluation.”
In other words, one common narrative—that the scaling up of CCTs is a good example of evidence based policy making because the use of randomization in the design of PROGRESA provided solid evidence that it was an effective program and hence other countries adopted a CCT because of this solid evidence—has it almost exactly backwards. The impact evaluation proved that PROGRESA was cost ineffective if it was considered as a mechanism to increase schooling. Everyone involved in the design knew this. They were not imposing the conditionality to get the behavior conditioned upon, but to get the transfer itself.