Leonardo Bursztyn, Lucas C. Coffman

The Schooling Decision: Family Preferences, Intergenerational Conflict, and Moral Hazard in the Brazilian Favelas

Can parental incentives impact school attendance?

In the favelas of Brazil, internal household dynamics have been a “black box” that makes it difficult to understand why so many poor children do not attend school. To address this question, Bursztyn uses a novel experimental approach to elicit preferences and to understand the informational structure within these households. The study asked parents to choose between monthly government transfers conditional on their adolescent child attending school; and guaranteed, unconditional transfers of varying sizes. In the baseline treatment, an overwhelming majority of parents prefer conditional transfers to larger unconditional transfers. However, few parents prefer conditional payments if they are offered text message notifications whenever their child misses school. These findings suggest important intergenerational conflicts in these schooling decisions, a lack of parental control and observability of school attendance, and an additional rationale for conditional cash transfer programs—the monitoring they provide. Families affected by conflict face similar educational challenges, and insights from this study can lead to policies that encourage parents to return their children to school.

Journal of Political Economy (2012)

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