Randomized controlled trials are the popular centerpiece of an emerging data-driven approach to figuring out precisely the best way to end poverty. Can a return to the scientific method fix the global aid industry?
For too long, “accountability” in the aid industry has meant nothing more than ensuring that a donor’s money was spent the way an agency said it would be. Rarely did organizations examine whether their spending achieved a positive impact (improved access to water, for example), much less one that stood the test of time (meaning the well didn’t dry up).
But recently, many aid organizations, including theInternational Rescue Committee, a New York humanitarian aid group specializing in refugee assistance, have used RCTs to, among other things, evaluate methods for nudging parents in Liberia toward more effective parenting techniques and tocreate highly effective community savings-and-loan programs to combat poverty in Burundi. It’s easy to see why charities are attracted to RCTs: They can make an aid agency’s work more efficient and generate solid evidence of progress to show funders.
As organizations continue to conduct more of them, RCTs are disproving many myths upon which we’ve designed development aid for years, not least of which is our longtime preference for projects over cash. If the data shows, as the RCT of GiveDirectly’s Kenya program did, that it’s most effective to hand a family $1,000 with no strings attached, then that’s precisely what we should do.
Read the full article in the July/August print edition of Pacific Standard or online.
Instead of handing over billions of dollars to bureaucrats to devise ways to help the world’s poor − and make aid vulnerable to ‘leakage’ in the process − why not just send one-time disbursements of cash directly to recipients so that they could lift themselves out of poverty?
Last month, I travelled to western Kenya to interview some of the recipients of cash transfers in those communities. (My research was funded by GiveWell, a non-profit organisation that vets the work of international charities).
“People used the money in different ways, to pay their children’s school fees, to buy a motorbike, to build a new house like you see my neighbour has done here,” one recipient explained. “I think everybody has used it well according to their own needs.”
louis vuitton belts mens
This is precisely what makes cash transfers different, and superior, to traditional forms of aid, proponents say. In an article for the Cato Institute Journal, former Lead Economist in the World Bank’s research group, Branko Milanovic, wrote: “By delivering aid in cash, we do not tell poor people what they should do…and how they should spend their money. We just allow them to decide, without paternalism, on their own. And we improve, ever slightly, their condition.”