Utility-Bill Stratification Targeting
Observational StudyReview
Public voucher programs often face administrative enforcement challenges when attempting to restrict subsidies to low-income families without relying on complex income verification processes.
Picture this
Instead of requiring complicated income tax forms that low-income families may not possess, an agency verifies eligibility using a household electricity bill that rates neighborhood poverty levels. This creates a low-friction, tamper-resistant filter ensuring social benefits reach only disadvantaged households.
What the evidence says
Mandatory utility bill stratification restricted participation to poor households, resulting in 53.5% of vocational voucher applicants residing in the poorest neighborhood tier in Bogotá.
- Who was studied
- N = 125,000 human secondary school voucher recipients across low-income neighborhoods in Colombia.
- How
- Administrative policy evaluation tracking eligibility compliance restricted to households in the lowest two socioeconomic strata (strata 1 and 2 out of 6) and public primary school graduates.
What to do
Utilize residential utility billing stratification as a low-friction administrative mechanism to target social subsidies toward low-income households.
From the source
"To enforce the eligibility rule, parents were required to present a utility bill with household stratification. In addition, vouchers were only available to students attending public primary schools."
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