TO CONDITION OR NOT TO CONDITION? 65


to their being dropped from the program. This had been the case with a pre- vious program providing milk powder for children, although it was not the case with the CCT (Morris et al. 2004). In Mexico and Nicaragua, a fair amount of stress was generated by fears over losing the benefit, although this had more to do with a lack of understanding of the targeting system than with the conditionality (Adato 2000; Adato and Roopnaraine 2010a). All of these exam- ples point to the need for conditions to be carefully designed and monitored to catch unanticipated consequences. They also point to the importance of effective and continuous communications with beneficiaries. In the CCT in Turkey, weakness in communications reduced program impacts (Adato et al. 2007; Ahmed et al. 2007). From an economics perspective, state influence on people’s decisions can


potentially be a strength for the broader society. If society places a value on certain outcomes, for example, a literate, educated female population or children who are vaccinated against contagious diseases, it may decide that the social benefits to imposing certain requirements outweigh the social costs to households of imposing a conditionality. People sometimes make invest- ment decisions that are not optimal from a societal standpoint. A common example in the context of CCTs would be a case in which parents choose not to continue their daughters’ education. An example in the context of families affected by AIDS is one in which families fostering orphans may choose not to invest in the fostered children’s health or education. These spillover effects at the societal level are referred to by economists as externalities and can be positive or negative. Where society perceives a net benefit from altering household decisions, a CCT that changes the incentives to influence those decisions is seen as a good thing. There are a number of reasons that parents make decisions that are per- ceived by others as suboptimal. In the case of education, they may not perceive sufficient value in education because of the structure of the local economy and their position within it. There may be no jobs to employ graduates, or parents and children may not be aware of job opportunities resulting from technological change or migration. Strengthening the economy and creating jobs could thus serve as a better incentive for educating children than a CCT. The need for the economy to be able to absorb new school graduates created by CCTs has been recognized as a major challenge in Mexico and Turkey.5 There are also social bases for parents’ schooling decisions. In parts of Turkey, some parents were reluctant to invest in their daughters’ education where the benefits would be reaped by their in-laws when the girls married; others


5This point was made with respect to Mexico by Santiago Levy in a seminar at the Brookings Institution in 2007. The findings for Turkey are from Adato et al. (2007).


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