Targeting child benefits in a transition economy

Transition economies use their child benefit programmes to provide additional economic support for families with children. However, budgetary pressures limit social spending in many countries. Therefore, targeting child benefit programmes to the poorest households may be a sensible solution to the problem of supporting families with children when social spending is in decline. Few transition economies have attempted to target child benefits. Hence evidence on the efficacy of means‐testing for child benefits is scarce. This study considers the implementation of one of the few means‐tested child benefit programmes in a transition economy and finds relatively little evidence of targeting problems. Moreover, means‐testing for child benefit substantially alters the distribution of benefits in comparison with the distribution in the more typical universal child benefit programme.