Spillovers in Social Program Participation: Evidence From Chile
AbstractWe analyse how peers affect the participation in a family allowance for poor families in Chile called Subsidio Unico Familiar (SUF) using a regression discontinuity design. To identify this spillover effect, we exploit variation in the information about social programs due to a home-visitation program for families in extreme poverty introduced in 2002 called Chile Solidario (CS). Conditional on an index of wealth, eligibility to receive the home-visits are random around municipality level cutoffs. We find that individual participation in CS increases the take-up of SUF by 30% and neighbors' participation in CS also increases the take-up of SUF by 7%. We also study heterogeneity by proximity to the municipality's office given that the distance between households and the municipality office might be a measure of participation costs. Effectively, we find positive direct effect of CS (33%) and spillover effects (9%) on the take up of SUF only for those families who are distant to the office, suggesting that neighbor
s are an important channel of information transmission.