Temporary Employment Programs, Consumption Smoothing and Employability

This document attempts to identify the effects of the most comprehensive temporary employment program implemented in Bolivia, the Plan Nacional de Empleo de Emergencia (PLANE), on per-capita calorie intake and future prospects of employment and wages. Using methods for estimation and inference that assume unconfoundedness, we find that the PANE was successful as a consumption smoothing scheme – it increased per-capita calorie intake in households where at least one member had participated in the program, but did not have any effects neither on post-program probabilities of being employed nor on post-program wages. This evidence suggests that, although public employment programs might be useful as social protection policies in times of recession – they help smooth consumption of poor households with unskilled breadwinners; they are not good alternatives to improve the employability of vulnerable populations.