Are Conditions on Cash Transfers Necessary to Improve Rural Education Outcomes? Evidence from Nicaragua

Across Latin America, conditional cash transfer programs (CCTs), in which governments pay poor families conditional on their children attending school, have successfully increased enrollment and attendance rates. No empirical evidence supports the need for costly conditionality, however, and I compare the effect of Nicaraguan unconditional remittances to the effect of CCTs to determine which more strongly influences educational investment. I test the outcomes of school enrollment and attendance and find that unconditional transfers more strongly impact enrollment, while conditional transfers more strongly increase attendance