Adverse conditions early in life often have long-lasting negative effects. This column examines what policy-makers can do to mitigate the disadvantages faced by children born in tough times. Evidence from PROGRESA, a pioneering program of conditional cash transfers to poor families in Mexico, indicates that it was successful in improving the educational attainment of young people who were born during a drought or flood. The authors are cautiously optimistic about the potential of such programs to address systemic inequality deriving from early life disadvantage.
Adverse conditions early in life often have long-lasting negative impacts. Studies of exposure to influenza and malaria find that children born in disease-ridden environments grow up to have lower educational attainment and worse labor market outcomes. In agricultural settings, evidence from Indonesia shows that children born during years with low rainfall obtain less schooling and are in worse health as adults.
These findings are especially troubling for poor households in low-income countries. Families are often hit particularly hard by unavoidable shocks with serious economic consequences, such as droughts that lead to a bad harvest.
What can policy-makers do to prevent these shocks from permanently affecting children born during these tough times? Are there policies that can at least partially mitigate any disadvantage that might materialize? The lack of evidence on concrete solutions to this problem poses a challenge for academics and policy-makers alike.
Take schooling, for example. Many studies show that children exposed to various early life shocks eventually end up with lower educational attainment. At the same time, conditional cash transfer (CCT) programs, which provide cash to families conditional on their children attending school, have been consistently found to be effective at boosting educational attainment. Despite the well-documented effectiveness of these CCT programs overall, it is not clear that they would be able to solve the specific challenge of closing the gap created by early life disadvantage.
Specifically, while we know these programs do succeed in keeping children in school for longer, it is not clear that they would help disadvantaged children (those hit by a negative early life shock) catch up with the rest of their peers. We could imagine, for example, CCT programs having larger benefits for children who were unaffected by adverse events early in life. If this were the case, CCT programs would exacerbate the gap between affected and unaffected children.
To shed light on whether CCT programs would reduce or amplify the disadvantage generated by a negative early life shock, we study a landmark program in Mexico called Programa de Educación, Salud y Alimentación(PROGRESA). This program provided cash transfers to poor families conditional on a variety of education- and health-related requirements.
Our study focuses on the education component: bi-monthly cash transfers given to mothers if their child attended at least 85% of school days. For evaluation purposes, 320 randomly selected ‘treatment’ localities started receiving program benefits in 1998, while 186 ‘control’ localities did not join the program until the end of 1999.
Many earlier studies have documented PROGRESA’s success in improving educational outcomes. Our focus is different: we are interested in whether PROGRESA was able to reduce the disadvantage generated by an early life shock. Specifically, we investigate whether the program yielded larger benefits for children born during years of adverse rainfall, compared with those who were not.
We focus on rainfall because, in our study’s agricultural setting, weather plays an important role in determining a household’s income. Income, in turn, determines how much money a household can spend on nutrition and other health inputs. We focus on rainfall in the year of birth because we expect nutrition and health spending to be particularly important early in a child’s life.
We show that in our sample, a child who is born during a drought or flood is significantly more likely to be stunted in childhood than a child who is born during a year of normal rainfall. We argue that this is because droughts and floods reduce agricultural wages and, in turn, nutritional intake. In other words, bad weather translates into lower-income, and lower-income in the first year of life translates into poor health in childhood.
In addition, we show that children born during droughts or floods end up with lower educational attainment when they are aged 12 to 18. The negative health effects of adverse rainfall translate into a persistent disadvantage in terms of educational attainment.
Our most important result, however, relates to PROGRESA’s ability to remediate early disadvantage: did the program reduce the negative effects of adverse rainfall? To answer this question, we look at the gap in educational attainment between children born in years of normal rainfall and those born during droughts or floods – separately for treatment localities (which received PROGRESA) and control localities (which did not receive PROGRESA).
We find that the gap is much larger in the control group than in the treatment group. This means that PROGRESA improved educational attainment for the disadvantaged children (who were born during a drought or flood) by substantially more than it did for children who were not exposed to these negative weather events. In short, PROGRESA was successful in helping disadvantaged children catch up.
Our results show that broad-based programs like PROGRESA can indeed have targeted impacts on the most disadvantaged, establishing the scope for remediation. Our takeaway is cautious optimism for the ability of such programs to address systemic inequality deriving from early life disadvantage.
Achyuta Adhvaryu is an assistant professor in Business Economics and Public Policy at the University of Michigan.
Teresa Molina is an Assistant Professor in the Department of Economics at the University of Hawaii at Manoa.
Anant Nyshadham is an Assistant Professor in the Department of Economics at the Boston College.
Jorge Tamayo is an Assistant Professor of Business Administration in the Strategy Unit at Harvard Business School.