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Opportunity NYC was the previous program. The current one is called Family Rewards 2.0 > On average, the program cost $13,459 per family, 48 percent of which

Opportunity NYC was the previous program. The current one is called Family Rewards 2.0 > On average, the program cost $13,459 per family, 48 percent of which was paid directly to families as cash rewards. This was over a three year period, which means that each family received 13459*.48/3 = $2150, or about $180/mo. So they provided between 2-5x as much money. I share your confusion though, as this is still categorically a lot smaller than I would've expected. I guess it's less of a UBI type program and focuses more on cash rewards for good health and educational outcomes. For a low income family, $2k/yr is non-trivial.

charlesdm 9y ago
> 48 percent of which was paid directly to families as cash rewards. So where did the other 52% go to? Working costs of the program?
- setgree 9y ago
  compliance and monitoring, most likely. The cash was conditioned on various attendance metrics, and the data collection process with such things is never as smooth as you'd like (I did a stint at a non-profit that ran experiments like this on behalf of economists).
  - r00fus 9y ago
    I wonder if it'd be more successful if that overhead were dropped to say 10-20% (via automation and simplification of qualifications)
    - wutbrodo 9y ago
      Why would it? The study said that they found no significant effect, not that the return was poor relative to costs. It's possible that shifting the saved administrative costs into more aid would appreciably change the outcome, but it seems more likely that it's a structural problem with the program: ie, that CCTs are optimizing the wrong input.
    - setgree 9y ago
      Regarding whether the effect would have been larger if the subjects got more cash -- in the original Progresa study, the ` size of the cash transfer is large, corresponding to about a 25 percent average increase in income of households living in extreme poverty' [0] (p.4). (Though in dollar amounts, if they are using the 'extreme poverty' metric of $1.25/day/person, we're talking about a lot less money in absolute terms). So there's something to this. But this is hard to square away with this newest study's findings of modest adverse impacts on labor participation rates. This, combined with null health effects, suggests that the CCTs are performing an income substitution effect, and that what people are doing with their newfound free-time is probably leisure rather than other forms of 'work' (i.e. exercising, cooking healthier meals, etc.) that policymakers might wish the subjects undertake. [0] https://www.povertyactionlab.org/sites/default/files/publications/449%20Progresa%20Health%20Gertler%202001.pdf https://www.povertyactionlab.org/sites/default/files/publica...
- boomboomsubban 9y ago
  They also offered things to help people earn more rewards. The brief linked mentions short term tutoring, uniforms for your job, and transportation to interviews. Still seems like a lot of overhead though.
brudgers 9y ago
$2k a year without strings attached is non-trivial. Tying the money to activities that may come with direct or indirect costs may make earning the money non-rational. At the granularity of paychecks, it's less than $45 a week. That's about four hours overtime at minimum wage. Or four hours of part time work at $11/hour. The value proposition of extra work is pretty straight forward. There's no bureaucratic process that might deny payment. There's no dependency on a health care provider or school filling out the paperwork correctly in a timely manner and correctly where "correctly" means to the satisfaction of bureaucratic process structured to say "no."
- wutbrodo 9y ago
  > $2k a year without strings attached is non-trivial. Tying the money to activities that may come with direct or indirect costs may make earning the money non-rational. At the granularity of paychecks, it's less than $45 a week. That's about four hours overtime at minimum wage. Or four hours of part time work at $11/hour. Sure, but we're talking about things that most people would agree is good anyway: kids doing well in school, being healthy, etc. The goal of the CCTs isn't to make people want to do things that they vehemently disagree with: it's to shift the incentive boundary so that they're on the right side of it for things they would like to do anyway.
- evolve2k 9y ago
  I'm really surprised now that consideration of the 'quantum of funds' was not mentioned at all in the report, even as a footnote. On face value, I would argue that $45/week extra although appreciated is not significant. As a thought experiment it's in the scale of, 1hr week spend more time help kids with homework, 1hr spend additional time job searching, 1hr deal with program administrative/reporting requirements. If a family say rewards themselves with a night out once a week for a dinner or movies etc, these funds are quickly gone. I think the scale here implies an incentive based around addressing a lack of will e.g. "Well if they just had a little more encouragement they'd spend more time helping their kids with education and seeking employment and good health". At this scale it does not address what I'll call 'incentive based on providing significant additional means for positive risk taking behaviour and structural optimization'. I define structural behavior as when a family makes significant changes to their own setup towards have an effect; like moving closer to the school, hiring a tutor, pursuing course further studies part time (2-3 days a week). Although the research process seems robust I agree the low quantum of funds discounts the greater significance of the findings. TLDR; Summary of findings: 'When we gave poor familes enough weekly funds to go out for dinner once a week alongside a bunch of criteria to seek improvement in their life, it made little difference'

charlesdm 9y ago

> 48 percent of which was paid directly to families as cash rewards. So where did the other 52% go to? Working costs of the program?

setgree 9y ago
compliance and monitoring, most likely. The cash was conditioned on various attendance metrics, and the data collection process with such things is never as smooth as you'd like (I did a stint at a non-profit that ran experiments like this on behalf of economists).
- r00fus 9y ago
  I wonder if it'd be more successful if that overhead were dropped to say 10-20% (via automation and simplification of qualifications)
  - wutbrodo 9y ago
    Why would it? The study said that they found no significant effect, not that the return was poor relative to costs. It's possible that shifting the saved administrative costs into more aid would appreciably change the outcome, but it seems more likely that it's a structural problem with the program: ie, that CCTs are optimizing the wrong input.
  - setgree 9y ago
    Regarding whether the effect would have been larger if the subjects got more cash -- in the original Progresa study, the ` size of the cash transfer is large, corresponding to about a 25 percent average increase in income of households living in extreme poverty' [0] (p.4). (Though in dollar amounts, if they are using the 'extreme poverty' metric of $1.25/day/person, we're talking about a lot less money in absolute terms). So there's something to this. But this is hard to square away with this newest study's findings of modest adverse impacts on labor participation rates. This, combined with null health effects, suggests that the CCTs are performing an income substitution effect, and that what people are doing with their newfound free-time is probably leisure rather than other forms of 'work' (i.e. exercising, cooking healthier meals, etc.) that policymakers might wish the subjects undertake. [0] https://www.povertyactionlab.org/sites/default/files/publications/449%20Progresa%20Health%20Gertler%202001.pdf https://www.povertyactionlab.org/sites/default/files/publica...
boomboomsubban 9y ago
They also offered things to help people earn more rewards. The brief linked mentions short term tutoring, uniforms for your job, and transportation to interviews. Still seems like a lot of overhead though.

brudgers 9y ago

$2k a year without strings attached is non-trivial. Tying the money to activities that may come with direct or indirect costs may make earning the money non-rational. At the granularity of paychecks, it's less than $45 a week. That's about four hours overtime at minimum wage. Or four hours of part time work at $11/hour. The value proposition of extra work is pretty straight forward. There's no bureaucratic process that might deny payment. There's no dependency on a health care provider or school filling out the paperwork correctly in a timely manner and correctly where "correctly" means to the satisfaction of bureaucratic process structured to say "no."

wutbrodo 9y ago
> $2k a year without strings attached is non-trivial. Tying the money to activities that may come with direct or indirect costs may make earning the money non-rational. At the granularity of paychecks, it's less than $45 a week. That's about four hours overtime at minimum wage. Or four hours of part time work at $11/hour. Sure, but we're talking about things that most people would agree is good anyway: kids doing well in school, being healthy, etc. The goal of the CCTs isn't to make people want to do things that they vehemently disagree with: it's to shift the incentive boundary so that they're on the right side of it for things they would like to do anyway.
evolve2k 9y ago
I'm really surprised now that consideration of the 'quantum of funds' was not mentioned at all in the report, even as a footnote. On face value, I would argue that $45/week extra although appreciated is not significant. As a thought experiment it's in the scale of, 1hr week spend more time help kids with homework, 1hr spend additional time job searching, 1hr deal with program administrative/reporting requirements. If a family say rewards themselves with a night out once a week for a dinner or movies etc, these funds are quickly gone. I think the scale here implies an incentive based around addressing a lack of will e.g. "Well if they just had a little more encouragement they'd spend more time helping their kids with education and seeking employment and good health". At this scale it does not address what I'll call 'incentive based on providing significant additional means for positive risk taking behaviour and structural optimization'. I define structural behavior as when a family makes significant changes to their own setup towards have an effect; like moving closer to the school, hiring a tutor, pursuing course further studies part time (2-3 days a week). Although the research process seems robust I agree the low quantum of funds discounts the greater significance of the findings. TLDR; Summary of findings: 'When we gave poor familes enough weekly funds to go out for dinner once a week alongside a bunch of criteria to seek improvement in their life, it made little difference'