The Welfare Impacts of Local Investment Projects: Evidence from the Guatemala FIS

This paper assesses the welfare impacts of local investments projects in rural areas of Guatemala. Using census track data from two rounds of the Guatemalan population census, we find, as expected, that local investment in schools significantly boost enrollment and normal progression in school, that investments in water and sewerage significantly improved measures of access to water. We also show that the amount of investment matters. Using a dose-response functions based on generalized propensity score we also find that larger investments are associated with larger welfare improvements. We find no evidence of effectiveness of investments on child mortality. In terms of productive projects, there was a significant and consistent impact on consumption. We did not find evidence to suggest complementarities of impacts.