This paper presents nonparametric evidence on the effects of the expansion of the Old Age Pension program in South Africa on child health. Did
this increase in household resources improve child health and nutrition? Does the gender of the recipient of the pension affect its impact?
The answers to these questions have very important policy implications. There is evidence that inadequate nutrition during childhood (and even in utero) affects long-term physical development, as well as the development of cognitive skills. This in turn affects productivity later in life (see Partha Dasgupta, 1993; John Strauss and Duncan Thomas, 1998; T. Paul Schultz, 1999). In the United States, the evidence suggests that monetary transfers to the poor have very little impact on child welfare (Janet Currie, 1995; Susan Mayer, 1997). However, the effects of parental income and monetary transfers on child outcomes are likely to be of greater magnitude among poor households in developing countries. The South African Pension program provides an unusual opportunity to evaluate the possible effects of such a monetary transfer.