Effects of unconditional cash transfers on family processes and wellbeing among mothers with low incomes

Abstract

This study examines causal impacts of unconditional cash transfers on economic hardship and key family processes that may affect children's development. The study randomized 1000 mothers of newborns, with prior-year household income below the federal poverty threshold, to receive unconditional cash transfers of $333 or $20 per month (Clinical Trial Registry number NCT03593356). Data collected approximately 12, 24 and 36 months after the child's birth show a moderate increase in household income and reductions in poverty; no statistically significant improvements in subjective economic hardship reports or quality of play with infants; and small, mostly statistically non-significant, increases in parental psychological distress and declines in mothers' relationship quality. However, mothers receiving the higher amount reported more frequently engaging in enriching child activities than mothers receiving the lower amount. Cash support may provide other benefits for families and children, but moderate support levels do not appear to address self-reported economic hardship or standard survey measures of maternal well-being. However, these results do not rule out the possibility of very small effects.

Fig. 1. Adaptation of the family stress model.

Authors’ adaptation of the Family Stress Model. The adapted model projects that an increase in (1) economic resources decreases (2) economic pressure in the household. A decrease in economic pressure decreases (3) parent psychological distress, which subsequently increases both (4a) interparental relationship quality and (4b) parenting quality, which are interlinked. Improvements in parenting quality decreases (5) child and adolescent problems. The surrounding environment’s (6) risk and protective factors directly affect each component of the model (1–5) and also moderate the relationships between the components (1–5).

Fig. 2. Standardized effect size ITT estimates of the impact of the BFY high-cash gift with adjusted and unadjusted confidence intervals.

All presented estimates come from the two-sided intent-to-treat regression analysis pooling measures across ages found in Tables 4–6, clustering the standard errors at the individual level and controlling for baseline covariates, child age at interview, and phone interview status. Standardized treatment effects are represented by the square markers, and the whiskers (lines) represent unadjusted and adjusted 95% confidence interval (CI) estimates. Effect sizes are standardized by the standard deviation of the low-cash gift group and adjusted for multiple hypothesis testing with Westfall and Young step-down resampling methods. Based on the adjusted p-value, degrees of freedom, and estimated effect size, the corresponding t-statistic and the standard error estimates were calculated to approximate the adjusted standard error and CI. Confidence intervals adjusted for multiple comparisons are represented by thin lines, and unadjusted confidence intervals are represented by thick lines. Filled square marker indicates that the estimate is statistically significant at the 0.05 level using the unadjusted p-value. Hypothesized direction of cash-gift treatment effects (preregistered) are presented in the “Hypoth.” column with “+” indicating a directional increase in outcome and “-” indicating decrease in outcome. Blue shows impact estimates that were in the expected direction; red shows those that were not in the expected direction. Standardized estimates for spanking disciplinary strategy, a dichotomous outcome, come from a linear probability model. Raw linear probability model coefficients are presented in Table 4. Applying a logistic regression model and converting the resulting log of odds ratio into Cohen’s d by a factor of the square root of 3 divided by pi estimates the effect sizes to be −0.14 for spanking disciplinary strategy (unadjusted p = 0.15).