An International Study of Impacts on Income and Wealth
International child sponsorship has long been a common way for people in industrialized countries to connect with the poor in developing countries. We estimate that there are at least 9 million internationally sponsored children today, which means that there may be up to 100 million people today in families that are directly affected by child sponsorship (9 million sponsored children and their family members, and 9 million sponsors and their family members) Sponsorship typically involves payments of $30-$40 per month to an NGO to help support an overseas child's schooling, health, and other needs. Some faith-based programs also place a strong emphasis on the spiritual mentorship of sponsored children. But the question remains--does it work? Our research shows that sponsorship translates to higher education levels and future earnings for formerly sponsored children.
We studied the life outcomes of 10,144 adults, 1,860 of whom were children sponsored by Compassion International. The remainder were either unsponsored siblings of the sponsored children, children from households without sponsorship but in a village where Compassion was present, or children from a nearby village where Compassion did not operate. Our goal was to examine the impacts of sponsored children, not during or immediately after the program, but the impacts of the program in adulthood. We did this by exploiting an age-eligibility rule dictating that only children 12 years of age or younger were eligible to be sponsored when the program began sponsoring children in a child's village. Thus we could compare children just below the cutoff with their siblings who were slightly too old. In addition, we could compare the difference between sponsored and unsponsored siblings with the difference between siblings in unsponsored households, both in Compassion and non-Compassion villages.
We first studied outcomes such as how much schooling individuals ultimately received, what kinds of jobs they held as adults, and community leadership. This was the subject of our 2013 paper which appeared in the Journal of Political Economy. We found large and statistically significant impacts on sponsored children, where international sponsorship increased the probability of secondary school completion by 12–18 percentage points over a 44.5% baseline, increased adult white-collar employment by 6.5 percentage points over an 18.5% baseline, and increased the probability of being a community leader. In our forthcoming article in the World Bank Economic Review, we explore the impacts of sponsorship on the adult income and wealth of formerly sponsored children. Here we find that international child sponsorship increased monthly income by $13–$17 over an untreated baseline of $75, an increase of approximately 20%, principally from inducing higher labor market participation. While sponsorship induces higher future wages through labor market participation for both men and women, it does not translate to increased wages for women conditional on employment. Results also vary between countries, with the highest impact in India (a 28.5% increase in income), and statistically insignificant results in Uganda, Kenya and Bolivia. Our results also show modest effects of child sponsorship on delayed marriage and reduced childbearing in adulthood. Additionally, we find that formerly sponsored children are more likely to live in homes with electricity and with higher quality floors and roofs. They are also more likely to own a mobile phone.
Why do we find these impacts? We believe sponsorship, at least in the Compassion model, not only provides for some basic educational and health needs, but is very good at raising aspirations among sponsored children through a weekly tutoring and spiritual mentorship program. A follow-up study among currently sponsored children in Kenya and Indonesia (with Phillip Roth, a doctoral student at Boston University) indicates that the higher aspirations for more education and a better job as an adult tend to mirror the bigger impacts we find in adult life outcomes. In another follow-up study using a digital coding of children's self-portraits, we find that sponsored children rank about 0.66 standard deviations higher in hope than non-sponsored siblings and children on the waitlist.
In short, yes, it seems that child sponsorship works.
International child sponsorship has long been a common way for people in industrialized countries to connect with the poor in developing countries. We estimate that there are at least 9 million internationally sponsored children today, which means that there may be up to 100 million people today in families that are directly affected by child sponsorship (9 million sponsored children and their family members, and 9 million sponsors and their family members) Sponsorship typically involves payments of $30-$40 per month to an NGO to help support an overseas child's schooling, health, and other needs. Some faith-based programs also place a strong emphasis on the spiritual mentorship of sponsored children. But the question remains--does it work? Our research shows that sponsorship translates to higher education levels and future earnings for formerly sponsored children.
We studied the life outcomes of 10,144 adults, 1,860 of whom were children sponsored by Compassion International. The remainder were either unsponsored siblings of the sponsored children, children from households without sponsorship but in a village where Compassion was present, or children from a nearby village where Compassion did not operate. Our goal was to examine the impacts of sponsored children, not during or immediately after the program, but the impacts of the program in adulthood. We did this by exploiting an age-eligibility rule dictating that only children 12 years of age or younger were eligible to be sponsored when the program began sponsoring children in a child's village. Thus we could compare children just below the cutoff with their siblings who were slightly too old. In addition, we could compare the difference between sponsored and unsponsored siblings with the difference between siblings in unsponsored households, both in Compassion and non-Compassion villages.
We first studied outcomes such as how much schooling individuals ultimately received, what kinds of jobs they held as adults, and community leadership. This was the subject of our 2013 paper which appeared in the Journal of Political Economy. We found large and statistically significant impacts on sponsored children, where international sponsorship increased the probability of secondary school completion by 12–18 percentage points over a 44.5% baseline, increased adult white-collar employment by 6.5 percentage points over an 18.5% baseline, and increased the probability of being a community leader. In our forthcoming article in the World Bank Economic Review, we explore the impacts of sponsorship on the adult income and wealth of formerly sponsored children. Here we find that international child sponsorship increased monthly income by $13–$17 over an untreated baseline of $75, an increase of approximately 20%, principally from inducing higher labor market participation. While sponsorship induces higher future wages through labor market participation for both men and women, it does not translate to increased wages for women conditional on employment. Results also vary between countries, with the highest impact in India (a 28.5% increase in income), and statistically insignificant results in Uganda, Kenya and Bolivia. Our results also show modest effects of child sponsorship on delayed marriage and reduced childbearing in adulthood. Additionally, we find that formerly sponsored children are more likely to live in homes with electricity and with higher quality floors and roofs. They are also more likely to own a mobile phone.
Why do we find these impacts? We believe sponsorship, at least in the Compassion model, not only provides for some basic educational and health needs, but is very good at raising aspirations among sponsored children through a weekly tutoring and spiritual mentorship program. A follow-up study among currently sponsored children in Kenya and Indonesia (with Phillip Roth, a doctoral student at Boston University) indicates that the higher aspirations for more education and a better job as an adult tend to mirror the bigger impacts we find in adult life outcomes. In another follow-up study using a digital coding of children's self-portraits, we find that sponsored children rank about 0.66 standard deviations higher in hope than non-sponsored siblings and children on the waitlist.
In short, yes, it seems that child sponsorship works.
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