Mon, 22 Jul, 2019

More Than Good Intentions

By Sushil Awale

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In the last fifty years, the developed nations have spent more than $16 trillion in the fight against global poverty, but still more than two billion people live on less than $3.10 per day, and 896 million of those live on less than $1.90 per day. Despite all these efforts, why has the world not been able to eradicate poverty to its roots? In the public dialogue, people argue that not enough has been spent to fight against poverty, and some argue that aid is not the answer. Whatever the reason may be, we need solutions.

In the book “More than Good Intentions”, Dean Karlan, a Yale economist and Jacob Appel, a field researcher have provided with a solution to the fight against poverty. The book talks about how the funding can be put to its best use by designing better projects to solve poverty. The book written in a very engaging manner would appeal to any lay-person.

The book starts with a story about monks in California. In this simple story, the authors did a fantastic job of portraying their argument about why just having more than good intentions is not enough in our fight against poverty.  Every couple of weeks, a group of monks would buy some fish from the fishermen. Then, they would set up a table in the dock, and keep the fishes at the center in a bowl. They would say some prayers, bow a couple of times and release the fishes in the ocean. This was a ritual for the monks, and it was their way of setting something right that they thought was wrong.  Obviously, the monks had a very good intention, and maybe it would give them a spiritual satisfaction, but would it make any significant difference? Or was their effort the best way to save the lives of fish?

The monks' effort gives the best analogy to our effort against poverty- ineffective. The book then talks about a two-pronged attack to fight against poverty. The first prong is behavioral economics i.e. understanding what people do and why they do it. And, the second prong is a rigorous evaluation.

The book explains that it is very crucial to understand the behavior of people when designing poverty alleviation programs. The book gives real world examples of innovative and working programs. For example, Mexico's government providing uniform for children to make them attend schools. Most of the poor students don't go to school because they can't afford to buy a decent uniform, and without it, they are discriminated by their classmates. Providing free uniform to the children made a significant improvement in the number of children who attended school.

In the rigorous evaluation, the book explains, an RCT(Randomized Control Trial) can be conducted. RCT is a method widely used in medical science for testing a new drug. RCT is one of the best ways to find if a solution is effective or not. In the project of providing uniform to the children in Mexico, the government could divide the students into two random groups, and provide only one group with the uniform. Then, both these groups can be studied for a period of time. If the group with the uniform responds better than the group without the uniform, we can ensure that the positive response is due to the distribution of uniform and not any other factors.

In the later part of the book, the authors have provided many real world examples of projects that have been successful and those that have failed. The examples are based on research, personal experiences, and empirical studies.