Opening Up Pandora’s Box: The Effect of Gender Targeting and Conditionality on Household Spending Behavior in Mexico’s Progresa Program

This paper evaluates the behavioral impact of conditionality and gender targeting on spending behavior in the Progresa conditional cash transfer (CCT) program from rural Mexico. Results indicate that transfer income is not spent differently from general income, suggesting that transfers exert only an income effect. In addition, women who have increased control over their extra cash are not significantly more likely to spend it in a “family-friendly” way than they do household earned income. Both features entail significant costs to beneficiaries and program budgets; our results indicate that further evidence is needed to confidently advocate for their inclusion in cash transfer (CT) programs.