The Effect of a Monthly Unconditional Cash Transfer on Children’s Development at Four Years of Age: A Randomized Controlled Trial in the U.S.

Developmental differences between children growing up in poverty and their higher-income peers are frequently reported. However, the extent to which such differences are caused by differences in family income is unclear. To study the causal role of income on children’s development, the Baby’s First Years randomized control trial provided families with monthly unconditional cash transfers. One thousand racially and ethnically diverse mothers with incomes below the U.S. federal poverty line were recruited from postpartum wards in 2018-19, and randomized to receive either $333/month or $20/month for the first several years of their children’s lives. After the first four years of the intervention (n=891), we find no statistically significant impacts of the cash transfers on four preregistered primary outcomes (language, executive function, social-emotional problems, and high-frequency brain activity) nor on three secondary outcomes (visual processing/spatial perception, pre-literacy, maternal reports of developmental diagnoses). Possible explanations for these results are discussed.