Do Conditional Cash Transfers Reduce Household Vulnerability in Rural Mexico?


This study empirically examines the vulnerability of rural households in Mexico and the impact of the conditional cash transfer (CCT) programme on them. Using the two most recent Mexican rural household panel datasets (2003 and 2007), I adopt Townsend's (1994) model and Kurosaki's (2006) modified version with instrumental variable methods. The empirical results confirmed better risk-sharing functions in basic needs (food) and the effects of CCT, together with other factors such as larger family size, 11 landholdings, and self-consumption, on reducing household vulnerability; however, the effects of remittances were somewhat opposite.


Consumption smoothing, Household vulnerability, PROGRESA-Oportunidades

JEL Classification

O12, D12, O54


World Language and Society Education Centre, Tokyo University of Foreign Studies (TUFS)