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The unintended effects of cash transfers on fertility: evidence from the Safe Motherhood Scheme in India

The unintended effects of cash transfers on fertility: evidence from the Safe Motherhood Scheme in India

The Question

What are some of the unintended consequences of India’s Safe Motherhood Scheme (JSY), one of the largest conditional cash transfer programs for pregnant women in the world? How has the program affected fertility rates of women?

What we found

Using data from two large household surveys, we compare the probability of childbirth or pregnancy of women during three-year periods before and after the introduction of the program in 2005. We exploit the variation in cash incentive under JSY across socioeconomic groups and states in India, and use an econometric approach that match women from the intervention areas with similar women from nearby control areas. We find that JSY may have resulted in a 2.5–3.5 percentage point rise in the probability of childbirth or pregnancy in states already experiencing high population growth. The positive fertility effect of JSY varies between rural and urban areas, by women’s age, and educational levels of women and their partners. 

Why it matters

JSY was introduced in response to persistently high maternal and child mortality rates. It is the first large scale national conditional cash transfer program in India, with a coverage of over 11 million women in 2010-11. The program provides a cash incentive to socioeconomically disadvantaged pregnant women for delivering their babies at health facilities. The program is administered through community health workers who themselves also earn small cash incentives. Preliminary studies have shown that the program is a modest success, with small improvements on rates of institutional childbirths and perinatal and neonatal mortality.

As with any program, however, unintended effects are possible: in our study, we found that the program may have increased the probability of childbirth or pregnancy by 2.7 percentage points (equivalent to a 7% rise from baseline) among women who are either poor or belong to socioeconomically disadvantaged caste groups. Among the remaining women, the probability increased by about 12% from the baseline. These outcomes were seen for women who belonged to certain poorer states with high initial levels of population growth as compared with women from other states, thereby reducing the pace of demographic transition. It’s important that policymakers and researchers recognize such unintended effects of this and similar programs and incorporate that knowledge into future policymaking and any potential adjustments to the current program.