labor (Cambodian Center for Human Rights, 2014). Strikes organized by the garment trade unions are common and headlines of confrontation between workers and official authorities often fill the pages of national and international newsletters.<sup>2</sup> Similarly, although the garment industry is the only sector in the economy for which there is a minimum wage,<sup>3</sup> workers often complain that wage increases are often met with steep increases in rents and food costs.

Against this background, this paper contributes to the contentious debate on the socio-economic advantages of the garment industry in Cambodia. It uses a rigorous empirical approach to explore the benefits of household participation in the textile and apparel sector. Instead of focusing on the labor market outcomes or the working conditions of garment workers, as most studies have, it explores the relationship between garment participation and monetary and non-monetary welfare indicators at the household level. More specifically, the study uses propensity score matching (PSM) estimators to identify the effect of having at least one household member employed in the garment sector<sup>4</sup> on a wide array of household level welfare-related measures using data from the Cambodia Socio-Economic Survey (CSES) collected in 2011. Monetary dimensions of welfare include consumption per capita, poverty and extreme poverty status, including the poverty gap, and asset ownership; while non-monetary indicators comprise the proportion of children aged 6-14 attending school and the self-reported incidence of food insufficiency.

In the absence of a good instrument for garment sector participation, we resort to PSM, an approach that has been widely used to estimate causal treatment effects in the evaluation literature. Its applications include, among others, the evaluation of labor market policies (Dehejia and Wahba, 1999; Bryson, 2002) and, closer to this paper, the identification of the effects of migration and remittances on household outcomes (Acosta, 2011; Cox-Edwards and Rodr ́ıguez-Oreggia, 2009; Jimenez-Soto and Brown, 2012; Bertoli and Marchetta, 2014). PSM estimators have the advantage of not requiring the introduction of functional forms of the relationship between household characteristics, participation in the garment sector and the measures of welfare. Our preferred specification uses kernel weights and estimates the standard errors using bootstrap, which provides a valid inference given that the estimator is asymptotically linear (Abadie and Imbens, 2008). However, since there is an on-going debate on whether the methodology can consistently produce unbiased estimates in the absence of an experimental approach (Dehejia and Wahba, 1999, 2002; Dehejia, 2005; Smith and Todd, 2001, 2005,b), Rosenbaum’s bounding sensitivity test is used to assess the robustness of the estimates to unobserved heterogeneity (Rosenbaum, 2002, 2010).

Results suggest that garment households are 0.9 percentage point less likely to exhibit food insufficiency and 3.3 percentage points more likely to have children attending school relative to households who are not involved in the textile and apparel industry. Surprisingly, garment participation appears to be negatively associated to consumption and asset ownership. Nonetheless, the sign of these point estimates is reversed when we exclusively analyze the treatment effects for the bottom 40 percent of the consumption distribution. Amongst the poorest households, participation in the garment sector raises per capita consumption by 3 percent and enhances asset ownership by 2.6 percentage points. Benefits in

> 2“Violent Clash as Garment Strike Intensifies” The Phnom Penh Post, 12/28/2013; “Cambodia Garment Workers Killed in Clashes with Police” BBC News, 01/03/2014.

> 3As of January 2016, the minimum wage in the garment sector is USD 140 per month.

> 4Not necessarily living in the same household.

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