Can Conditional Cash Transfers Strengthen the Market for Healthcare?

Featuring
Margaret Triyana
Harris School of Public Policy, University of Chicago

Donors and developing country governments alike are increasingly using Conditional Cash Transfer programs (CCTs) to provide the poor with the funds they need to make investments in health and education. In a new paper, Maggie Triyana asks an intriguing question about the effect of a CCT program in Indonesia on the overall healthcare market. She discovers that the introduction of a CCT program directed at expecting mothers induces an increase in the demand for midwife services. Triyana exploits randomization in the geographic roll out of a CCT program in Indonesia to show how the program increases the use of midwives by 45%, that the program is associated with a 10% increase in the number of midwives and a 10% increase in the delivery fees they charged in the areas where the CCT was available.