Via Business Insider:
Paul Niehaus, Michael Faye, Rohit Wanchoo, and Jeremy Shapiro came up with a radically simple plan shaped by their own academic research. They would give poor families in rural Kenya $1,000 over the course of 10 months, and let them do whatever they wanted with the money. They hoped the recipients would spend it on nutrition, health care, and education. But, theoretically, they could use it to purchase alcohol or drugs. The families would decide on their own.
GiveDirectly Gives Poor Kenyan Families $1000 - Business Insider
Points:
- “Ninety-two cents of every dollar donated to GiveDirectly is transferred to poor households through M-PESA, a cell phone banking service with 11,000 agents working in Kenya.”
- ”Initial reports from the field are positive. According to Niehaus, GiveDirectly recipients are spending their payments mostly on food and home improvements that can vastly improve quality of life, such as installing a weatherproof tin roof. Some families have invested in profit-bearing businesses, such as chicken-rearing, agriculture, or the vending of clothes, shoes, or charcoal.”
- “GiveDirectly remains an outlier in the development arena, perhaps the only organization that distributes private donations, made online, directly to the poor with no strings attached — no requirement to launch a business or to immunize one's child; no distribution of bed nets, solar lanterns, or goats.”
- “…other development experts who have tested unconditional cash transfers are enthusiastic about the approach. The trouble is convincing NGOs to invest in such programs beyond the pilot stages.”
- “Unconditional cash transfers to individuals do little to address the structural factors responsible for poverty, such as government corruption, gender discrimination, and the lack of quality jobs, schools, and health care.”
Ponder: In a world where access to technology is what separates the haves and have-nots, what is the best economic development model for closing the gap?
