Marie Michael Library

Evaluating targeted cash transfer programs: A general equilibrium framework with an application to Mexico

Coady, David; Harris, Rebecca Lee

This report focuses on the indirect and direct effects of transfer programs.  It demonstrates how modelling results can be combined with information from household surveys to provide an analysis of the direct impact of such programs and the indirect impacts arising from domestic financing mechanisms.  This suggests that a poverty alleviation strategy must have a financing strategy underlying it, and the need for domestic financing can have consequences for household incomes.  The report focuses on the introduction in Mexico of a poverty alleviation transfer program called PROGRESA, which has been used in simliar programs.