Cash Grants Aren’t a Long-Term Solution to Global Poverty

From 2015 to 2017, more than 10,500 extremely poor families in rural Kenya received a one-time cash transfer of $1,000 from a nongovernmental organization. The results were extraordinary: Households that got the money experienced 48% fewer infant deaths before age 1 and 45% fewer child deaths before age 5 compared with those that didn’t receive the aid.

In August researchers published these findings in a working paper that received wide media attention. The study added to a growing body of evidence that suggests cash grants are one of the most effective ways to combat worldwide poverty. One well-known review of the evidence from 2018 found that cash programs can significantly increase people’s spending on food and other basic necessities, bolster assets and savings, and improve children’s school attendance, among other metrics. Beyond these tangible benefits, a key argument for cash transfers is that they afford poor people the dignity to choose what’s best for themselves, unlike other forms of aid, such as food or housing assistance.