The GiveWell Blog

New research on cash transfers


  • There has been a good deal of discussion recently about new research on the effects of cash transfers, beginning with a post by economist Berk Özler on the World Bank’s Development Impact blog. We have not yet fully reviewed the new research, but wanted to provide a preliminary update for our followers about our plans for reviewing this research and how it might affect our views of cash transfers, a program implemented by one of our top charities, GiveDirectly.
  • In brief, the new research suggests that cash transfers may be less effective than we previously believed in two ways. First, cash transfers may have substantial negative effects on non-recipients who live near recipients (“negative spillovers”). Second, the benefits of cash transfers may fade quickly.
  • We plan to reassess the cash transfer evidence base and provide our updated conclusions in the next several months (by November 2018 at the latest). One reason that we do not plan to provide a comprehensive update sooner is that we expect upcoming midline results from GiveDirectly’s “general equilibrium” study, a large and high-quality study explicitly designed to estimate spillover effects, will play a major role in our conclusions. Results from this study are expected to be released in the next few months.
  • Our best guess is that we will reduce our estimate of the cost-effectiveness of cash transfers to some extent, but will likely continue to recommend GiveDirectly. However, major updates to our current views, either in the negative or positive direction, seem possible.

More detail below.

Read More

Cash transfers vs. microloans

We’ve written that people in the developing world can get very high returns – in excess of 20% annually (and sometimes much more) – on cash transfers. We’ve previously argued that this is both plausible and empirically supported. However, it raises the question: “If people in the developing world can get such good returns on…

Read More

The case for cash

Our choice to name GiveDirectly as our #2 charity has drawn some surprise and criticism. GiveDirectly seeks to deliver 90c directly into the hands of the very poor (no strings attached) for every $1 of total organizational expenses. There are many people who consider this intervention “unproven” (since there is not research linking cash transfers…

Read More

Cost-effectiveness of nets vs. deworming vs. cash transfers

Update 12/5/2014: we update our cost-effectiveness models annually. The most up-to-date versions can be found here.  This post discusses how we see the relative “bang-for-the-buck” – good accomplished per dollar spent – of three interventions: Distribution of insecticide-treated nets to fight malaria, the intervention carried out by our #1 charity (the Against Malaria Foundation). Unconditional direct…

Read More

Evidence of impact for long-term benefits

We’ve recently published our updated review on the evidence on cash transfers. It elaborates on a claim we’ve made previously – that there is evidence for long-term benefits from cash transfers at high average rates of return. Some people have expressed skepticism of this evidence, pointing to several limitations: there are not many studies, some…

Read More

Giving cash versus giving bednets

We recently published a new review of GiveDirectly, a “standout” charity that gives cash directly to poor people in Kenya. As we were going through the process of discussing and vetting the new review, I found myself wondering how I would defend my preference to donate to distribute insecticide-treated bednets (ITNs) against a serious advocate…

Read More