Social Programs and Formal Employment: Evidence from the Brazilian Bolsa Família Program

Author/Editor:

Anna Fruttero ; Alexandre Ribeiro Leichsenring ; Luis Henrique Paiva

Publication Date:

June 19, 2020

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

Employment is key to combating poverty. Thus, detractors of social assistance programs argue that they create disincentives to work. While there is substantial evidence showing limited effects of these programs on overall labor supply, the jury is still out with respect to their impact on formal employment. This paper exploits an unannounced change in the eligibility rule of the Bolsa Familia program in Brazil, one of the oldest and largest conditional cash transfers in the world, to identify the causal impact of the program on formal employment, combining three large administrative datasets. This paper finds that the program has a positive effect on entry in formal labor market, especially for younger cohorts.

Series:

Working Paper No. 20/99

Subject:

English

Publication Date:

June 19, 2020

ISBN/ISSN:

9781513547701/1018-5941

Stock No:

WPIEA2020099

Format:

Paper

Pages:

21

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