Debt Accumulation of Poor CCT Beneficiary Households: Evidence from Brazil using a novel rich administrative dataset

Debt Accumulation of Poor CCT Beneficiary Households: Evidence from Brazil using a novel rich administrative dataset

• Author
• Felipe Goulart Tomkowski
• Abstract

• Using rich Brazilian administrative data, we investigate the effect of conditional cash transfers (CCT) on poor households’ debt accumulation by exploring a beneficiary status discontinuity around the adulthood year of the youngest child. Debt accumulation and delinquency rates response to CCT depend on whether credit supply is sensitive to the benefit. Moreover, credit card expenditures increase in response to the loss of CCT, indicating it works as a substitute for cash transfers. The expenditure increase comes partially from higher labor income.

• Keywords
• access to credit, conditional cash-transfer, debt accumulation.
• Subject Area
• Corporate Finance, Intermediation, and Banking

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