
How to rescue people from deep poverty, and why the best methods work - e15ctr0n
http://www.economist.com/news/international/21679812-how-rescue-people-deep-povertyand-why-best-methods-work-leaving-it-behind
======
panglott
"In the 1990s it became clear that microfinance, then the most exciting tool
in development economics, was not reaching the very poorest people... BRAC
came up with a scheme to help the ultra-poor. It gives them a small stipend
for food, followed by an asset such as a cow or a few goats, which they are
expected to manage. Field workers visit weekly for the next two years,
teaching recipients, for example, how to tell when a cow is in heat and how to
get it inseminated. The aim is to help women 'graduate' from extreme poverty
to the normal kind—as Sir Fazle puts it, 'to help them back into the
mainstream of poor people'. ...A study published earlier this year in
_Science_ showed that similar programmes run by other NGOs boosted consumption
in Ethiopia, Ghana, India, Pakistan and Peru, with the effects lasting at
least a year after they ended. ...Such programmes are pricey. In India and
Bangladesh they cost more than $1,000 per household at purchasing power
parity. Other research explains why. ...The poorest women, it turned out, did
far more hours of income-generating work...Yet they packed them into fewer
days... The reason is that they toil mostly as domestic servants and in the
fields—and casual agricultural work is seasonal. During planting and harvest
they work extremely hard; the rest of the year they do little. Better-off
women usually rear livestock, which is not only steady work but pays about
twice as much per hour. When the poorest women are given cows, they quickly
fill their idle time..."

~~~
kelukelugames
My family tried to do this in China. They donated a flock of sheep to a rural
village. But they were tricked into paying high prices for an inferior breed.
Keep in mind, my family is in China.

So how do we help foreign countries without losing our donations to swindles?

~~~
maxerickson
Monitoring for fraud and publicizing good and egregious bad actors probably
goes a long way against swindlers.

For example, these posts are critical of Heifer International:

[http://blog.givewell.org/category/heifer-
international/](http://blog.givewell.org/category/heifer-international/)

But they are mostly concerns about the whole concept of giving livestock, so
it's probably still an effective strategy for someone that wants to give
livestock to give money to Heifer International rather than trying to do
anything more direct.

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bglazer
> What is striking is not so much their greater wealth ... Their relatives
> have started talking to them. Asked to explain how their lives have changed,
> one of the first things they say is that they now get invited to weddings.

This is the most interesting part to me. Their escape from "deep poverty" has
allowed them access back into their social networks.

~~~
zo1
It's also very unfortunate because such social networks are key in preventing
individuals from going into "deep poverty" in the first place.

------
gadders
>>Such programmes are pricey. In India and Bangladesh they cost more than
$1,000 per household at purchasing power parity.

I wish there was a way I could send $1,000 directly to a named individual,
rather than the usual charity practise of putting mony in a pot and getting a
duplicated letter from your sponsored person.

~~~
thetmkay
GiveDirectly[0] provide a minimal 'charity layer' of such a service
(transferring money directly to the right people).

If you feel disillusioned by modern charity, effective altruism might interest
you. I recently read "Doing Good Better" by Will Macaskill and I recommend it
- it puts forward a very compelling case for how to optimise charity-giving.

[0][https://www.givedirectly.org/operating-
model.html](https://www.givedirectly.org/operating-model.html)

~~~
gadders
I guess what I want to do is help 100% of one person, rather than 0.001% of a
thousand.

~~~
morgante
Why? Isn't it the same in the end?

Money is fungible.

~~~
jdhawk
Some people like having concrete evidence of where their dollar was spent?

~~~
VikingCoder
Here's my thinking, along these lines... Everyone's all into Gamification,
right? Well... I started to wonder what would happen if you made the ultimate
cross between Entertainment and Philanthropy. Wrap it up as a video game you
can give to a teenager in the first world, to try to teach them some empathy.
I tried to describe what it's like to play this game, as if one teenager was
explaining it to another teenager.

...

"Save A Kid"

It costs $100 to buy the game, and it's $15 per month to play.

When you pick a character, you get to pick a Country of origin, and then an
age and a sex. Then you get to start customizing, by looking for a character
that has a given race or religion, if you care about that. For newbies, I'd
definitely recommend picking a character that speaks a language you can speak
fluently. And if you're an Expert, you can play a character that has different
Disadvantages. It doesn't give you any bonus attributes, but you get bragging
rights for playing one of them well. There's like, Orphan and Kid-With-AIDS,
and then there are harder ones like "Scarred by War" where the kids have
missing limbs, etc. Anyway, newbies should probably avoid those at first.

So, anyway, it's kind of like The Sims, or a Tamagotchi, or Farm Town, or
something.

You log on every day, and depending on the character you picked, you either
get an email, or maybe a voice mail or a video mail. The character tells you
about how much it appreciates the new computer
([http://latptop.org](http://latptop.org)) and the food
([https://www.fmsc.org/home](https://www.fmsc.org/home)). The first couple
levels, it's all about gaining Health Points. You can totally nerf your
character by spending some of your monthly allotment of extra gold points on
buffing the kid's parents ([http://www.kiva.org/](http://www.kiva.org/)), if
he has them. The parents start generating more gold points on their own, which
makes it a lot easier to play. Some people even buy buffs online
([http://www.heifer.org/](http://www.heifer.org/)), which I think is cheating,
but for a newbie, it's an easy way to keep your kid alive.

Anyway, you and your friends can make a clan, and all play characters in the
same village. I've even heard that some really crazy rich players can buy
buffs for the whole village, like a potable water and electricity system
(fora.tv/2008/07/03/Dean_Kamen_on_Potable_Water_and_Sustainable_Electricity).

There are Events in the game, where like the country the kid is in goes into
War. That sucks, because sometimes you lose your character, and the game is
perma-death, which is lame. They do a really good job making the game
realistic, because sometimes you even see in the news that the real country is
in war. Most of the time, they just make stuff up though, because most of the
wars never show up on TV, but your character won't shut up about them.

Anyway, it's a sandbox game, which some people don't like. But the AI is
incredible. Your character will like ask you how they can keep their food from
spoiling, and if you look it up online
([https://www.ashoka.org/fellow/mohammed-bah-
abba](https://www.ashoka.org/fellow/mohammed-bah-abba)), and explain to them
how to do it, they can save some of their food. Or like, how they can build a
windmill from scrap metal
([https://en.wikipedia.org/wiki/William_Kamkwamba](https://en.wikipedia.org/wiki/William_Kamkwamba)).

Anyway, you play the same character as long as you want to, but most people
get bored after the kid has a job and their own family, and they start over at
level one. Restarting costs another $100 though.

The game developers say if too many people play the game, they might even run
out of characters to play. I don't buy it. They'll always make up some new
War, or some world-shattering Disaster like a typhoon or something, and then a
bunch of new characters will open up. Expansion packs, and all that.

A lot of people play this game like 40 hours a week, or something ridiculous.
Some people say that playing this game has changed their lives or whatever,
and they give up their jobs and play it full time
([http://www.peacecorps.gov/](http://www.peacecorps.gov/)).

...

Anyway, I guess you can already play most of those mini-games in other forms,
but until they package it up in a nice box that you can buy at Best Buy, and
they set up some dedicated servers, and set up a scoring ladder (good grades
in school, etc.) and maybe some achievements ("high school diploma", "got a
job," etc.), oh and a nice technical support line to answer questions and give
advice, I don't think the game will really take off.

~~~
dragonwriter
I'm trying to figure out whether I more want to laugh at that -- or invest in
it.

~~~
VikingCoder
As Zoidberg would say... "Can't it be both?"

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grandvizier
what are the best methods? (for someone who doesn't want to register to read
the economist)

~~~
gadders
You get a few articles free, or go to the homepage and open in incognito mode.

~~~
grandvizier
a yes, those economists ain't got nothin on Incognito

------
Tepix
Sounds like BRAC is doing very promising work indeed. I wonder why I never
heard of them before.

~~~
cba9
To some extent, you probably _have_ heard of them, under the rubric 'direct
transfers' or cash payments. Direct transfers of valuable assets (cows or
cash) to the very poor have done very well when evaluated in randomized
experiments, and I suspect you've seen at least one article on them in the
past (albeit it might have been on GiveDirectly or one of the other programs
rather than BRAC itself).

------
RP_Joe
>Esther Duflo of the Massachusetts Institute of Technology showed that women
who were offered cows, goats and intensive training in the Indian state of
West Bengal not only did not fall back into indigent poverty but kept climbing
out of it.

Lets not minimize the effect of "intensive training". Education is just as
important as the goats.

------
RP_Joe
>This is a clue to why microfinance does not reach the poorest.

I have worked with the poor in developing countries. I am highly skeptical of
the claims made by microfinance. This work described here is VERY interesting
because it does not involve debt and it ADDS education.

------
merpnderp
I wonder if anyone has just tried giving these people the $1,000 up front?
Maybe with some resources on how they can invest that money?

I bet most would opt to move to a place with better opportunities, which isn't
a bad idea.

~~~
RP_Joe
Often the problem is that they do not have the talent to manage money. Giving
them livestock causes them to work for rewards. Its easier for them to learn.
There is a commitment required. Also people are willing to help them, in their
learning. If they show willingness to earn rather than beg, people are more
apt to help. Still, there needs to be an evaluation into the charter of the
recipient. Some could sell the livestock and buy booze.

------
oli5679
I'd be really interested in seeing the actual presentation. Does anyone have a
link to the slides?

------
known
[http://qz.com/566702/finland-plans-to-give-every-citizen-
a-b...](http://qz.com/566702/finland-plans-to-give-every-citizen-a-basic-
income-of-800-euros-a-month/) FTW

