Developing Economies

Sorry, Kids: No More Cash For Going To School.

A pilot project that paid poor kids for regular attendance at school, and paid their parents for things like going to the dentist, showed middling results.

Mike Bloomberg said three years ago that the program, which was launched in New York with private money, could be turned into a permanent, publicly funded program. But the private program ends in August, and city officials said yesterday that there are no plans to go forward with a public program, the New York Times reports.

The program did seem to help in some ways. It reduced "some housing and hunger hardships," according to a report that came out yesterday. But it did not improve achievement for students in elementary or middle school. It did appear to help one subset of students — high-school kids who were unusually well prepared when they started high school.

Payments ranged from two- to three-figures. Kids got $25 to $50 a month for regular school attendance, for example.

This type of program, known as a conditional cash transfer, has been used widely in the developing world. It's as straightforward an economic incentive as you can think of: Do this thing, and you'll get money.

Perhaps the most famous example is Oportunidades, a program in Mexico that pays parents to keep their children in school and take them for regular medical checkups.

But, as the mixed results of the New York program show, even an incentive as clear as a cash payment can be hard to put into practice in a way that drives results in the real world. "You always hope that you'll come across a magic silver bullet, and you never do," Bloomberg said yesterday, according to the NYT.

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