Can Four Young Economists Build the Most Efficient Charity Ever?

It's holiday giving season. Would you donate cash to a poor family, and let them spend it on whatever they wish? That's the radically simple premise of the new philanthropy GiveDirectly, which I report on today at The Atlantic:

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 netssolar lanterns, orgoats.

The economics might be sound. But the politics within the non-profit world are more complicated. Niehaus, now a professor at the University of San Diego, says 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.

"We had conversations with people [in the non-profit sector] who said there was a lot of internal resistance to unconditional transfers," Niehaus told me. "If this works, what are we all here for? Why do we have jobs? There's an industry that exists that tries to make decisions for poor people and determine what's best for them. In some ways, that's the industry I came from. But the value of that hasn't been proven."

Read the whole piece!

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