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The Brazilian cash transfer programme, regional effects, and its impact on the labour market

Abstract The aim of this paper is to discuss the effects of the Bolsa Família Programme on the Brazilian labour market. The data analysed derive from a sample from the Family Budget Survey, 2008–2009. The descriptive analysis highlights the importance of Bolsa Família in the composition of families’ income, especially in the case of those families that live in less economically developed regions of Brazil such as North and Northeast, as well as rural areas. The empirical analysis carries out econometric models (Seemingly Unrelated Bivariate Probit model and Instrumental Variables (IV)), and demonstrates both a strong and negative effect of the cash transfer provided by Bolsa Família on the Brazilian labour market.