by Kate McFarland | Nov 17, 2017 | News
The US charity GiveDirectly has officially launched its trial of basic income in rural Kenya, and is now enrolling experimental participants.
The US$30 million experiment will be the largest trial of basic income to date, in terms of both size and duration. All residents of about 120 rural Kenyan villages, comprising more than 16,000 people in total, will receive some type of unconditional cash transfers during the experiment; some of these villages, moreover, will receive the universal basic income for twelve years.
It is also unique among current experiments in that it is designed as a randomized controlled trial in which the experimental units are villages rather than individuals. This means that, unlike the studies occurring in Finland, Ontario, the Netherlands, and elsewhere, the GiveDirectly experiment will be able to capture community-level effects of the basic income [*].
The experiment will include three treatment groups. In two groups, villages will receive a universal basic income of about US$23 per resident per month (roughly half of the average income in rural Kenya). In one group, comprising 80 villages, the payments will continue for two years; in the other, comprising 40 villages, the payments will continue for twelve years. In the third treatment group, all residents of each village will receive a single lump-sum payment equal in amount to the two-year basic income (i.e. about US$276). Another 100 rural Kenyan villages have been randomly assigned to a control group.
Chief Financial Officer Joe Huston announced the official launch in a blog post dated November 13, declaring, “It has begun! As I write, field officers in Bomet County, Kenya are beginning to enroll the first (post-pilot) households into the largest basic income initiative in history.”
The launch had been delayed from its originally anticipated date in September, due in part to political disruptions in Kenya surrounding a contested presidential election.
Since October 2016, GiveDirectly has been running a preliminary pilot in a single Kenyan village. All residents of this village (numbering 95 at the start of the pilot) were guaranteed a monthly unconditional cash payments, which will continue in this village for 12 years.
This preliminary study was conducted to help the researchers fine-tune the implementation of the full-scale experiment, and data collected from the pilot village will not be included in the analysis of the experiment. Because of the latter, GiveDirectly has decided to make data and information from pilot village available to the public (no data collected from the experiment itself will publicized until the trial has concluded). For example, the charity has published responses to a survey of participants and is now running a three-part series on “lessons drawn” from a year of observing the pilot village.
[*] In describing the experiment on its website, GiveDirectly suggests that it is interested mainly in individual-level (rather than community-level) effects of basic income, stating, “We will assess the impact of a basic income against a broad set of metrics, including: economic status (income, assets, standard of living); time use (work, education, leisure, community involvement); risk-taking (migrating, starting businesses); gender relations (especially female empowerment); aspirations and outlook on life.” This does not render the community-level effects irrelevant, however, since individual attitudes and behavior can be influenced by social multiplier effects.
Correction (Nov 17): An earlier version of this article stated that the experiment would include 200 villages in total (with 80 in the lump-sum payment treatment group), amounting to around 26,000 total recipients. This statement was based on out-of-date information, and has now been corrected. In fact, approximately 120 villages will be included in the study (totaling more than 16,000 recipients), with a reduction of the number of villages in the lump-sum treatment arm.
Reviewed by Russell Ingram
Photo CC BY-SA 2.0 David Brossard
by Ashley | Sep 10, 2017 | News
Pictured: Kenyan village to receive GiveDirectly’s guaranteed basic income Source: Nichole Sibecki for NPR
GiveDirectly offers to give every adult in a Kenyan village a guaranteed basic income of 27,258 Kenyan Shillings- or 264 US dollars- per year for the next 12 years without any conditions. Providing unconditional cash transfers directly to people has proven to increase economic outcomes and psychological well-being.
GiveDirectly, a US-based nonprofit, is challenging the traditional structure of international aid by shifting the power dynamics between donors and people who receive aid. In our current structure, donors decide what people receive since most aid provided by governments, nonprofits and individuals is given as an in-kind donation. Instead, the purpose of GiveDirectly’s donation structure is to trust the expertise of people experiencing poverty to choose how best to spend the money. GiveDirectly will be measuring the long-term outcomes.
According to the first part in an NPR series on emerging aid models to redress global poverty, GiveDirectly will provide every adult in a village in Kenya a guaranteed basic income of 2,271.50 Kenyan shillings per month, or 22 US dollars for the next 12 years. Typically, adults live on less than 206.50 Kenyan Shillings per day, or 2 US dollars. For two-parent households, this donation boosts their monthly income by 50 percent. The money is wired to a bank account connected to each villager’s phone. Some families have used this additional income to better support household nutrition and education outcomes for children. The US-based nonprofit plans to expand the guaranteed income to 200 villages in Fall 2017 and assess the long-term impacts by comparing the outcomes with 100 villages that do not receive the payments.
Already, a study published in the Quarterly Journal of Economics discovered how, in Kenya, unconditional cash transfers (UCTs) have a significant impact on economic outcomes and psychological well-being in communities. UCTs contribute to local economic development by increasing consumption rates. They also improve social and emotional development in communities that heavily rely on social networks for supports and services that may otherwise be inaccessible.
Research from Canada’s Mowat Centre also shows that providing money with no strings attached can help support social entrepreneurs that may be experiencing financial hardship to get their ventures off the ground. For example, one Kenyan family that is a beneficiary of GiveDirectly’s donation, is focused on investing in an entrepreneurial venture to grow a forest of eucalyptus trees and sell the fuel from the plants. Profits from the family’s venture would be used to fund high school tuition for four children as an investment in breaking the intergenerational cycle of poverty.
In contrast to GiveDirectly’s aid model, Zambia’s government is choosing to filter who receives aid and under what conditions. Originally, a government program gave families in a rural west Zambian village 164, 628.31 Zambian Kwacha, or 18 US dollars, every other month for the past five years. The program proved to be successful: families used this additional support to invest in creating multiple business ventures to multiply their capital. To help aid these business ventures, the usage of related software can make this a lot easier, and with advancements in technology, businesses are able to conduct remotely accessing Sage software services so they are always on point with what they require. The government has therefore decided to scale up the program to increase the population receiving this cash aid. Simultaneously, the government has decided to limit the cash transfer to exclude people such as those who initially received the money in the pilot program: two-parent households, people who are employed, and people who are able-bodied. Instead, Zambia will provide aid only to single-parent households, people with disabilities, seniors, and people who are unable to work. This limitation on providing aid based on who is deemed eligible is what GiveDirectly is challenging.
GiveDirectly’s guaranteed income in Kenya is increasing access for all with the goal of improving health outcomes and building towards financial security. It can be particularly valuable for people with disabilities who often experience job discrimination and barriers to financial self-sufficiency. For them, this monthly influx of cash provides a foundation for independence. People with disabilities often struggle to afford medication and rely on financial support from other family members to sustain themselves. This additional monthly income will help to mitigate the costs of medication and basic necessities for everyone.
Grassroots savings clubs in low-income communities are another asset to consider when measuring the long-term impacts of GiveDirectly’s guaranteed income. Some people do not have access to banks or struggle to save money when it is easily accessible from an electronic savings account. Savings clubs are typically groups of 10-15 community members who collectively pool their resources each month. The total amount is then provided to a different individual from the savings club to look after for a month. This community-based savings account relies on faith in the community members to manage the money for everyone else. Some villagers have noted how critical this social bonding is to allow them to maintain their savings since they know the community is depending on them to effectively manage their budget. Researchers have found in case studies around the world, from Bangladesh to Central/South America and West Africa, that savings club serve as a common element of the economic infrastructure in low-income neighborhoods.
Giving cash directly to children and families, with no strings attached is being shown to improve the quality of life in a number of communities, particularly in boosting economic, health, and education outcomes. As more organizations begin measuring the long-term impacts of unconditional cash transfers and basic incomes, we will continue to gain evidence on whether these are viable solutions to deeply entrenched social issues like global poverty.
More information at:
Ashley Blackwell. “CANADA: Mowat Centre Report Shows Impact of Basic Income on Social Entrepreneurship.” BIEN. 28 July 2017.
GiveDirectly. “Basic Income.” 4 September 2017.
Johannes Haushofer and Jeremy Shapiro. “The short-term impact of unconditional cash transfers to the poor: Experimental evidence from Kenya.” The Quarterly Journal of Economics vol. 131 (4). 1 November 2016.
Nurith Aizenman, “How to Solve Poverty: Why Not Just Give People Money.” NPR. 7 August 2017.
“Cash Aid Could Solve Poverty- But There’s a Catch.” NPR. 9 August 2017.
“How to Buy A Goat When You’re Poor? Join A ‘Merry-Go-Rund’.” NPR. 19 August 2017.
by Kate McFarland | Dec 10, 2016 | News
The charity GiveDirectly, which is now preparing to launch a large-scale basic income experiment in Kenya, has been giving direct cash donations to poor individuals in Kenya and Uganda since 2009. Now donors and other interested parties will be better able to observe the effects of these cash transfers: in November 2016, GiveDirectly launched a new website, GDLive, which reports live and unedited updates from donation recipients.
As GiveDirectly explains in a blog post, “With GDLive, donors can see when (to the hour), how much, and to whom cash transfers were sent, and learn more about recipients’ lives. Respect also means a commitment to honesty: We aren’t cutting a single recipient’s answers and we’ll show everything they have to say about how GiveDirectly has impacted their lives: the good stories and the bad. We encourage recipients to be as honest as possible.”
To protect privacy, GDLive does not publish individuals’ last names or specific villages. The organization also gathers consent from recipients at multiple stages before publishing their testimonies.
In 2016, about 6500 households in Kenya received cash through GiveDirectly. As of October 19, GiveDirectly reports, about two-thirds consented to sharing their stories on GDLive.
Follow GDLive at live.givedirectly.org.
See also:
Michael Cooke (November 22, 2016) “Human stories are not the opposite of data” GD blog.
Reviewed by Genevieve Shanahan
Photo of GiveDirectly recipient, CC BY-NC-ND 2.0 PROcoolloud
by Kate McFarland | Sep 25, 2016 | News
In a blog post dated September 22, the charity GiveDirectly announced that it will begin an initial pilot study of a basic income guarantee in a village in Kenya in late October.
According to GiveDirectly’s announcement, the pilot will “test the operational details of the model and also generate qualitative insights which we will then feed back into the ultimate quantitative evaluation.”
In the same post, the research team laid out some further details concerning its full study (the start date of which remains unspecified). In the full study, experiments will be conducted in two counties in rural Kenya — one in which GiveDirectly has acted previously (with few issues and near 100% participation rates), and one new county.
Villages in these counties will be divided into three treatment groups: one in which all adult residents receive a guaranteed basic income for 12 years, one in which all adult residents receive a guaranteed basic income for two years, and one in which all adult residents receive a lump sum equivalent to the two-year basic income. The amount of the basic income will be approximately $0.75 per day, which will be held fixed across villages in all three treatment groups. Data will also be collected on a control group of villages in which no cash transfers are given to residents.
In the blog post, the researchers mention a particular interest in the question of how a long-term income guarantee impacts risk-taking, such as in starting a business. They go on to add that, given the scale of the experiment, “we have reasonably good odds of detecting impacts not only on individuals, but also on village-level markets.”
GiveDirectly aims to include 40 villages in the first treatment group and 80 in each of the latter two. This would result in roughly 26,000 individuals receiving cash transfers.
There are some minor complications. For instance, according to a blog post published on September 5, lower-than-usual participation rates are being witnessed in some parts of Kenya — which the researchers attribute largely to misgivings and skepticism about the nature of the charitable organization:
We’ve found that people typically refuse out of skepticism. Potential recipients find it hard to believe that a new organization like GiveDirectly would give roughly a year’s salary in cash, unconditionally. As a result, many people have created their own narratives to explain the cash, including rumors that the money is associated with cults or devil worship.
However, the charity is working to improve its outreach to communities and stresses that, contrary to some press, relatively high rates of nonparticipation do not bespeak a “fatal problem” with the experiment.
GiveDirectly has raised over $11 million since April, when the organization announced its plan to fund a major study of basic income. It has also assembled a team of distinguished advisors, including Alan Krueger (former Chairman of President Obama’s Council of Economic Advisers) and MIT economists Abhijit Banerjee and Tavneet Suri (MIT). In July, an article about the work of GiveDirectly appeared in the prestigious Quarterly Journal of Economics.
Reference
GiveDirectly team (September 22, 2016) “New details on our basic income pilot”
Reviewed by Dawn Howard
Photo CC BY-NC 2.0 Evandro Sudré
Special thanks to Kate’s supporters on Patreon
by Karl Widerquist | Apr 15, 2016 | News, The Indepentarian
GiveDirectly, a charity which has used direct cash distribution in one-time, lump-sum payments to fight poverty in Africa, announced it will launch a full basic income trial. The project will involved at least 30 million dollars and academic support from leading researchers at the MIT. The charity is relying on donations from all around the world. The trail will fully adopt the basic income model by making regular cash payments to every resident in several villages in Kenya.
GiveDirectly’s appeal for support it below:
Dear friends,
We’re announcing something new. Something that’s never been done before.
GiveDirectly is launching a universal basic income trial — this year, we’ll begin paying everyone in multiple Kenyan villages a regular income that’s enough to meet their most basic needs, and keep doing so for more than ten years.
People have long debated whether we should provide a guaranteed minimum floor for everyone (a “basic income”), and what would happen if we did. Would it spur risk-taking and creativity, or would people just stop working? Would it drive growth or reduce it? Would people spend more time on entrepreneurship, or on education and parenting? With the idea being hotly debated around the world, it’s time we found out.
We’re teaming up with leading researcher Abhijit Banerjee from MIT and have calculated that we can run and study a real trial for $30 million, and we’re willing to match the first $10 million donated.
To make this happen, join us and contribute a small amount to help the world find out if a guaranteed basic income could be the tool that ends poverty.
Together, in the last five years, we’ve raised $100 million, helped shift a worldwide policy discussion, and served over 150,000 individuals based on the proven principle that giving poor people cash works. Now it’s time for us to take the next step. It’s because of you that we’ve made it this far, so we hope you’ll join us for this newest project.
Visit our website to learn more or to contribute to the project.
If you do decide to give to this trial, at a minimum your money will help shift the life trajectories of thousands of low-income households. At best, it will change how the world thinks about ending poverty.
All the best,
Ian Bassin
Chief Operating Officer – Domestic
You can read more about GiveDirectly’s new basic income project at the following links:
