Levy S ti ev
Santiago Levy at the
entrance to the drawing
room of Mexico’s
in Washington DC,
February 15, 2012.
The Creator of CCTs Looks to a New
Challenge to Social Inclusion
By Santiago Levy
ver the past decade and a half, Latin
American countries have developed
new programs to combat poverty.
Beginning in 1995 in Mexico (when
I was undersecretary of finance) and
in Brazil, a simple idea has taken hold.
Rather than transferring income to the poor through
price subsidies, food stamps or direct distribution
of foodstuffs (milk, tortillas, bread), it is better to
transfer income directly in monetary form.
But to ensure that such transfers are not
permanently needed, these programs are conditioned
on poor households’ investing in their human capital:
their health, nutrition and their children’s education.
The bet is that healthier and more educated
youngsters will enter the labor market under
better conditions than their elders, breaking the
intergenerational transmission of poverty.
These new programs, commonly known as
conditional cash transfer programs (CCTs), have
allowed the region to reduce the proportion of
households living in extreme poverty, and have
brought hope for a better future to a majority of Latin
Evaluations of CCT programs in Mexico, Brazil, and
Colombia, and of similar undertakings in Honduras,
Nicaragua, the Dominican Republic, and Ecuador,
show that CCTs are better at reaching the poor than
past social programs. And they have increased school
attendance, time spent in school, nutrition, and the
health of poor children.
The views expressed in this article are the
author’s own and do not necessarily reflect those
of the institution with which he is affiliated.
“The greatest triumph of Latin America’s CCTs would be
to gradually shrink as extreme poverty is eradicated.”
Americas Quarterly SPRING 2012
PHOTOGRAPH BY MAX HIRSHFELD