Intra-household time allocation in rural Mexico: Evidence from a randomized experiment

This chapter examines the effects of Oportunidades, a conditional cash transfer program, on the allocation of time of household members in rural Mexico. I exploit the random placement of benefits across communities in the evaluation sample and the program's eligibility criteria and scheme of incentives to identify effects. The majority of Oportunidades benefits are linked to children's school attendance, implying a reduction in the price of schooling. I argue that changes in relative prices lead to substitution effects, whereas the (almost) unconditional nutritional transfer translates into an income effect. Findings show increases in schooling and reductions in children's participation in market and non-market work. Although the program does not seem to substantially alter adults’ time allocation, evidence suggests that adult women substitute for children's time in non-remunerated activities.