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We estimate the impact of a large anti-poverty program -- the Uruguayan PANES -- on political support for the government that implemented it. The program mainly consisted of a monthly cash transfer for a period of roughly two and half years. Using the discontinuity in program assignment based on a pre-treatment score, we find that beneficiary households are 21 to 28 percentage points more likely to favor the current government (relative to the previous government). Impacts on political support are larger among poorer households and for those near the center of the political spectrum, consistent with the probabilistic voting model in political economy. Effects persist after the cash transfer program ends. We estimate that the annual cost of increasing government political support by 1 percentage point is roughly 0.9% of annual government social expenditures.

Zonder onderwerpscode: economie

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There is limited empirical evidence on whether unrestricted cash social assistance to poor pregnant women improves children's birth outcomes. Using program administrative micro-data matched to longitudinal vital statistics on the universe of births in Uruguay, we estimate that participation in a generous cash transfer program led to a sizeable 15% reduction in the incidence of low birthweight. Improvements in mother nutrition and a fall in labor supply, out-of-wedlock births and mother's smoking all appear to contribute to the effect. We conclude that, by improving child health, unrestricted unconditional cash transfers may help break the cycle of intergenerational poverty.

Zonder onderwerpscode: economie

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We estimate the impact of a large anti-poverty cash transfer program, the Uruguayan PANES, on political support for the government that implemented it. Using the discontinuity in program assignment based on a pre-treatment eligibility score, we find that beneficiary households are 11 to 14 percentage points more likely to favor the current government relative to the previous government. Political support effects persist after the program ends. A calibration exercise indicates that these persistent impacts are consistent with a model of rational but poorly informed voters learning about politicians' redistributive preferences.