Conditional Cash Transfers, Sometimes it’s the Simple Things That Catch on Quickest

CCTs, otherwise known as Conditional Cash Transfers, are used throughout the developing world now with the principal objective of reducing poverty in the future by promoting investment in human development in the present. Sound vague, it is. In other words, areas like health and education are targeted with goals such as getting the required amount of vaccinations for a newborn during the first year, monitoring school attendance, improving nutrition, etc. When the metrics are met, the family receives a CCT (i.e., $$$$).

To give you a sense of how these programs work, the table on page 3 on this doc has a nice review:

I put CCTs in the category of a great initiative that was probably skipped over because on the surface it just seems to simplistic. Give a parent a financial incentive to keep their kid in school throughout the month, and surprise, they do. In practice there is a lot that can go wrong,  but smartly designed, CCTs have a bright future.

The exit/graduation strategy however can be a bit rough, on the last page of the doc they talk about this specifically.


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