Give cash directly to the extreme poor?
GiveDirectly facilitate payments from donors directly to the extreme poor. These are no strings attached gifts, based on the principle of free markets and that individual beneficiaries know their own needs best. It has had some big name supporters inc. Google.
I'm interested to get some other perspectives on this approach.
A great idea, a challenge is getting the right level and the balance between good targetting and the dangers of means-testing (benefit-traps, intrusiveness). A real step on the road to a Universal Basic Income.
I concur with Bobby that the right level is critical in making the money work, and it also depends on whether you are talking about one off payments or regular cash transfers.
A few years ago I evaluated a HIV/AIDS orphans and vulnerable children's programme which encouraged children to be housed within extended families who were often very poor. Cash incentives were given, but some of these families were so below the poverty line and using any cash they had for the purpose of consumption, or emergency payments for something (usually for medicine or doctor's fees) the amount given was simply not enough for them to break out of extreme poverty.
So knowing what the threshold should be is important - such that surplus can be invested towards that family's development (i.e. making the money work).
It is a great idea.
It has been tried, tested and defended by respectable people on the ground. Countries have done it with success.
As to who needs the money, local community leaders do know who needs the cash. More often than not, government, politicians, and even many NGOs do not know who is in need.
Money with no strings attached should be given to women as their sense of need is stronger than most men.
Money with no strings attached removes conditioning often placed by rich donors who want their own pet projects see the light of day, and these often do not address the most pressing needs.
Cash based approaches (both conditional and unconditional) are used increasingly as an appropriate method of aid within the humanitarian sector. The Cash Learning Partnership have a huge amount of information on this and have used research to advocate to others on its use... including working with UNOCHA to get cash considered routinely by the UN clusters (including the WASH cluster). They also have developed market assessment tools such as the EMMA. Not sure how much research has gone on within the development sector but am sure there is a lot of learning that directly translates. See http://www.cashlearning.org/
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