Protecting Vulnerable Children from Uninsured Risk: A New Role for Conditional Cash Transfer Programs?

Alain de Janvry, Elisabeth Sadoulet, Pantelis Solomon, and Renos Vakis September 2006 Conditional cash transfer (CCT) programs have proved to be effective in inducing chronic poor households to invest in the human capital of their children while helping reduce poverty. They have also protected child human capital from the shocks that affect these households. In this paper, we argue that many non-poor households exposed to uninsured shocks have to use children as risk coping instruments, creating long term irreversibilities in child human capital development. We review recent experiences to explore how CCT programs can be designed to serve as safety nets for the vulnerable non-poor when hit by a shock This would help them not use children as risk coping instruments, thus avoiding long term irreversibilities in child human capital development and creation of a source of new poor.