Incentives in Brazilian Bolsa Família CCT Program: Adverse selection, moral hazard, improving mechanisms and simulations

dc.creatorBugarin, Mauricio Soares
dc.creatorGadelha, Sérgio
dc.creatorSantos, Artur
dc.creatorDuarte, Janete
dc.creatorAmaral Jr., João B.
dc.creatorNeves, José
dc.creatorOliveira, Plinio
dc.creatorRegatieri, Rebeca
dc.date2020-08-17
dc.date.accessioned2022-11-03T21:19:42Z
dc.date.available2022-11-03T21:19:42Z
dc.identifierhttps://bibliotecadigital.fgv.br/ojs/index.php/bre/article/view/79098
dc.identifier.urihttps://repositorioslatinoamericanos.uchile.cl/handle/2250/5048102
dc.descriptionThe Bolsa Família CCT Program (BFP) has successfully reduced poverty in Brazil. However, the theoretical literature on associated economic incentives is scarce. A mechanism-design analysis identifies problems of adverse selection and moral hazard in the BFP. The paper proposes simple improving incentive-mechanisms. The Citizens’ Contribution Mechanism (CCM) requires beneficiaries to devote time to the PBF encouraging recipients with higher income to leave. The Graduation Mechanism (GM) offers financial incentives to ensure sustainable emancipation of qualified beneficiaries. The Human Capital Incentive Mechanism (HCM) increases transfers to efficient municipalities. We show that the CCM solves the adverse selection problem, the GM solves the moral hazard problem of beneficiaries and the HCM solves a moral hazard problem of local managers. A simulation based on 2010 census data shows that the mechanisms allow, within 6 years, significant increases in the reach and precision of the PBF and yields cost reductions of over R$4.6 billion.en-US
dc.formatapplication/pdf
dc.languageeng
dc.publisherSociedade Brasileira de Econometriaen-US
dc.relationhttps://bibliotecadigital.fgv.br/ojs/index.php/bre/article/view/79098/78196
dc.rightsCopyright (c) 2020 Brazilian Review of Econometricspt-BR
dc.sourceBrazilian Review of Econometrics; Vol. 40 No. 1 (2020); 1-58en-US
dc.sourceBrazilian Review of Econometrics; v. 40 n. 1 (2020); 1-58pt-BR
dc.source1980-2447
dc.subjectConditional Cash Transfersen-US
dc.subjectInequalityen-US
dc.subjectIncentives Theoryen-US
dc.subjectAsymmetric Informationen-US
dc.subjectTargeting.en-US
dc.subjectD86en-US
dc.subjectH53en-US
dc.subjectI38en-US
dc.titleIncentives in Brazilian Bolsa Família CCT Program: Adverse selection, moral hazard, improving mechanisms and simulationsen-US
dc.typeinfo:eu-repo/semantics/article
dc.typeinfo:eu-repo/semantics/publishedVersion


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