Can Unconditional In-Kind Transfers Keep Children Out of Work and in School? Evidence from Indonesia

Abstract

Abstract Child labour is a global issue which creates a need for evidence-based interventions such as cash and in-kind transfers. However, there is limited evidence about the effect of in-kind transfers on child labour, impeding policy development. We address this gap by examining the impacts of an unconditional in-kind transfer, a nation-wide subsidised rice program, on child labour and schooling using longitudinal household survey data from Indonesia. To identify the causal effect, we use coarsened exact matching with difference-in-differences estimator. The results indicate that the program is effective in decreasing the probability of working for boys though it does not have a significant impact on the probability of schooling. However, as an unconditional in-kind transfer, its ability to decrease child work for boys, especially of those who are both working and attending school, provides an important policy implication on how a food subsidy program can indirectly influence child wellbeing.