The effect of cash transfers on maternal health seeking: Evidence from Ecuador

Governments often aim to increase health service uptake using financial incentives. In the case of maternal healthcare, where the quality gradient between informal and formal care is quite steep, these incentives have the potential to improve birth outcomes significantly. However, whether these programs encourage care ultimately depends on the elasticity of demand for care. We examine the effects of one such program in Ecuador that aimed to incentivize care through conditional cash transfers for antenatal care and lump-sum grants to facilitate delivery. We employ a difference-in-discontinuities approach, exploiting a discontinuity created by the program's targeting method to identify its causal impact. Our findings reveal a 10 percent increase in institutional deliveries, a 3.5 percent increase in trained delivery care, and a 20 percent increase in births at private facilities. We do not see evidence of a complementary increase in the uptake of antenatal care services, which was already high before the program. Our results also suggest a marginal decrease in birth weights as a result of the program, which we attribute to selection into measurement. We show that our difference-in-discontinuity approach improves precision compared to traditional regression discontinuity designs, but does so at the cost of increased specification error.¹.