Conditional Transfers and Living Arrangements in Rural Mexico

Luis Rubalcava, University of California, Los Angeles and Centro de Investigación y Docencia Económicas (CIDE)

We analyze the impact of PROGRESA on living arrangement. Beneficiary households are compared to eligible households in communities with no program. Results based on double differences propensity score matching compare the change in demographic composition, over five years before and after the Program’s implementation. We find that PROGRESA promotes young adults to exit their homes. Males leave relatively more than females, so do sons relative to daughters. We show a partition effect: PROGRESA provides independence to individuals that whish to constitute their own families. The program also allowes households to shelter new members: absent sons and daughters return while non- corresident parents and grandparents join the household. Data on migration show that PROGESA increases the probability of females to out-migrate due to marriage, whereas teenagers are more likely to leave to another state or the United States. However, prime-age members stay more in their communities as a consequence of PROGRESA