Conditional Cash Transfers, Civil Conflict, and Insurgent Influence

Conditional cash transfer (CCT) programs are an increasingly popular tool for reducing poverty in conflict affected areas. Despite their growing popularity, there is limited evidence on how CCT programs affect conflictand theoretical predictions are ambiguous. We estimate the effect of conditional cash transfers on civil conflict in the Philippines by exploiting an experiment that randomly assigned eligibility for a CCT program at the village level. We find that cash transfers caused a substantial decrease in conflict-related incidents in treatment villages relative to control villages in the first nine months of the program. Using unique data on local insurgent influence, we also find that the program reduced insurgent influence in treated villages. An analysis of possible spillovers yields inconclusive results. While we find no statistical evidence of spillovers, we also cannot rule out that the village level effect was due to displacement of insurgent activity from treatment to control villages.

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