who are just eligible with the outcomes of those who are just ineligible for the program. The discontinuity in the probability of participation in CS induced by the poverty index is not sharp but fuzzy, since not all families identified as target of the program in 2001 were immediately served. This happened due to supply constraints. CS was rolled out for a period of 5 years and about 20% of the 225,000 target families were enrolled each year, giving priority to the poorest (more than 95% of families invited to participate in CS accept the invitation). Thus, the cutoffs are unknown in the initial years of the program. We estimate the effective cutoffs using the procedures applied in Chay, McEwan and Urquiola (2005) and Card, Mas and Rothstein (2008). We show graphically that there are striking discontinuities in participation at the estimated cutoffs in several of the municipalities in Chile. In addition, for those municipalities where the discontinuity is not visible at the estimated threshold, it is not visible in outcomes. In other words, for municipalities where the discontinuity exists, which account for 80% of our sample, we are able to accurately estimate its location.

We show that the average impact of eligibility for CS on participation in the program in a given year/cohort is about 21% (for households with a poverty index in the neighborhood of the discontinuity). We then produce intention to treat (ITT) and instrumental variables (IV) estimates of the impact of CS, using eligibility to CS as an instrument for participation in the program. We use administrative records that cover a period of 10 years (2000-2009). We start observing families at least a year before the introduction of CS, and we follow them two, four and up to six years after entry into the program.

It is important to learn from a program such as CS, given its targeting of the extreme poor in a middle income country, and the intensity of the engagement with the target population. Governments in middle and high income countries repeatedly express concern with the poorest families in their countries, and with the difficulty of designing effective support policies for this group.

Although there have been attempts to study CS in previous papers, our study represents a substantial improvement over past studies for three main reasons. First, we are studying the program’s effectiveness almost 10 years after it was first implemented. This is important because programs of this type often take a few years until they become fully functional. In addition, the fact that we have a relatively long data horizon allows us to study both short and medium impacts of the program.

Second, the regression discontinuity estimator we implement is likely to produce more credible parameters than alternatives such as difference in difference estimators, which are likely to be affected by violations of the common trends assumption (since participants and non-participants in CS are probably on different trends, especially in the period studied in our paper, during which Chile experienced very high growth). It is unlikely there are serious threats to the internal validity of our estimates, but there are two challenges to their external validity. On one end, as in any 3