Research Insights: Can Cash Transfer Programs Increase Labor Supply?

Starting in 2006, Bolivia implemented a non-targeted, nationwide conditional cash transfer program that delivered transfers to households of school-age children conditional on attendance. The program increased the probability of working and the number of weekly work hours among parents of eligible children, mainly in areas with limited access to formal financial services. The program allowed mothers of eligible children to work more as they used the transfers to start or scale up small businesses. In turn, as mothers entered the labor force, overworked fathers were able to work fewer hours.