Ethnicity, Gender and Educational Expenditure in Bolivia: Evaluation of an Old-Age Cash Transfer Program

Monica Yanez Pagans, University of Illinois at Urbana-Champaign

This paper measures the impact of an old age unconditional cash transfer program in Bolivia (Bolivida) on children's human capital investments by ethnicity and gender of the recipient. Taking advantage of the regression discontinuity created by the program, I investigate whether this exogenous variation in income is allocated differently within indigenous, multiethnic, and non-indigenous families, conditional on having at least one eligible member and one school-age child living in the household. The paper finds that cultural factors play a key role in the intrahousehold human capital resource allocation process. Bolivida transfers to women and men both lead to increases in children's educational expenditure, however, women are more effective at promoting human capital accumulation. The pattern of allocation within ethnic groups is clear; non-indigenous and multiethnic beneficiaries have larger impacts on the expenditure in education than analogous indigenous beneficiaries. The children most benefited are those who were already enrolled in school.