Cash for grades or money for nothing? Evidence from regression discontinuity designs

This paper estimates the impact of a Chilean cash for grades programme, the Bono por Logro Escolar (BLE) in 2013, on future educational outcomes. The cash transfer was targeted using two scores from 2012, an income index and academic performance. I implement a sharp regression discontinuity design along these two running variables. I show that students marginally at each side of the two thresholds used only differed in receiving the BLE in 2013. The main causal estimates for the outcomes are not statistically significantly different from zero. Additionally, the main causal estimates are centred around zero and their standard errors are small. If a local average effect of the BLE in 2013 exists this is at best modest in magnitude. Any potential impact of the BLE in 2013 would have been at least smaller than those found in developing countries, where effects of at least 0.17 of a standard deviation on test scores have been observed