The age gradient in the effects of poverty alleviation program on schooling. Evidence from the Vietnam hunger eradication and poverty reduction program

Abstract

This paper estimates the effect of the Vietnam Hunger Eradication and Poverty Reduction (HEPR) program on school enrollment and shows how it changes by age at first treatment. Using longitudinal data that span over 15 years and a difference-in-differences research design, we find that early treatment (age 8) increases enrollment by 9.9 percentage points. In contrast, the enrollment of children receiving treatment at later ages (age 12 and 15) is either unaffected or even reduced in rural areas, where it is paralleled by an increase in labor market participation. These divergent results by age and area of residence depend on two components: first, the effect of subsidizing education declines with the age of first treatment; second, starting from age 15, HEPR beneficiaries residing in rural areas are entitled with free access to the Vocational Training Program, which favors a prompt transition to the labor market.