GiveDirectly

GiveDirectly is a nonprofit organization operating in East Africa that helps families living in extreme poverty by making unconditional cash transfers to them via mobile phone. GiveDirectly transfers funds primarily to people in Kenya, Uganda, and Rwanda.

History

GiveDirectly originated as a giving circle started by Paul Niehaus, Michael Faye, Rohit Wanchoo, and Jeremy Shapiro, students at MIT and Harvard, based on their research into philanthropy.[3] In 2012 they formalized their operation into GiveDirectly.[3]

In December 2012, GiveDirectly received a $2.4M Global Impact Award from Google.[4] In June 2014, the founders of GiveDirectly announced plans to create a for-profit technology company, Segovia, aimed at improving the efficiency of cash transfer distributions in the developing world.[5][6][7] In August 2015, GiveDirectly received a $25M grant from Good Ventures.[8]

In April 2016, GiveDirectly announced a $30M initiative to test universal basic income in order to "try to permanently end extreme poverty across dozens of villages and thousands of people in Kenya by guaranteeing them an ongoing income high enough to meet their basic needs" and, if it works, pave the way for implementation in other regions.[9] The initiative launched in November 2017 and is set to run for 12 years.[10]

In 2017, GiveDirectly applied their model for the first time in the U.S., distributing cash-loaded debit cards to residents of Rose City, Texas, following Hurricane Harvey.[11]

Operations

COVID-19 support

GiveDirectly set up two emergency response program to the COVID-19 pandemic: one in the US, for which it has raised US$118 million, and one in African countries, for which it has raised US$76 million. The organization has sent cash relief to 116,000 families in the US and 342,000 families in Kenya, Liberia, Malawi, Rwanda and Togo.[12]

In Togo GiveDirectly used satellite and cellphone data to target needy people, delivering cash completely contactless. It built on an existing cash transfer program called Novissi introduced by the government of Togo. Money is paid via mobile money technology, with beneficiaries withdrawing money at local shops. GiveDirectly helped expand the program to certain rural areas where the government found it particularly difficult to identify the poorest beneficiaries.[13] The machine learning algorithm uses two steps. First, it finds the poorest villages by analyzing, among other things, roof material, sizes of farm plots and the presence of paved or unpaved roads through satellite images. Second, it finds the poorest individuals within a village by analyzing their mobile phone data like lengths and frequency of phone calls, number of inbound versus outbound calls, and amount of mobile data used. After the poorest individuals are identified, they are asked to enroll via mobile phone.[14]

Basic income experiment

In April 2016 GiveDirectly announced that they would be conducting a 12-year experiment to test the impact of a universal basic income on a region in Western Kenya.[15][16] More than 26,000 people will receive some type of cash transfer, with more than 6,000 receiving a long-term basic income.

Working in rural Kenya, it plans to conduct a randomized control trial comparing four groups of villages:

  • Long-term basic income: 40 villages with recipients receiving roughly $0.75 (nominal) per adult per day, delivered monthly for 12 years
  • Short-term basic income: 80 villages with recipients receiving the same monthly amount, but only for 2 years
  • Lump sum payments: 80 villages with recipients receiving a lump sum payment equivalent to the total value of payments of the short-term stream
  • Control group: 100 villages not receiving cash transfers

In November 2019, an economics paper on the GiveDirectly experiment was published. It found the local fiscal multiplier to be around 2.6x (in other words, each dollar provided by cash transfers increased local economic activity by $2.60).[17]

Funding

GiveDirectly collects donations from private donors on its website as well as foundations.[18] In 2015, the organization received a $25 million donation from Good Ventures, a private foundation started by Facebook co-founder Dustin Moskovitz and his wife, former Wall Street Journal writer Cari Tuna.[19]

In 2017 GiveDirectly received $5 million in Bitcoin from the Pineapple Fund.[20]

Reception

GiveWell reviews

GiveDirectly has been named a GiveWell 'top rated' charity for each of the last eight years: 2012,[21][22] 2013,[23] 2014,[24][25][26] 2015,[26][27] 2016,[28][29] 2017,[30] 2018,[31] 2019.[32]

Reception by development economists

After the release of GiveDirectly's impact self-evaluation in October 2013,[33] World Bank economist David McKenzie praised the robustness of the study's design and the clear disclosure of the study lead's conflict of interest, but raised two concerns:[34]

  • The use of self-reporting made the results hard to interpret and rely on (this being a feature of any study that attempted to measure consumption).
  • The subdivision of the sample into so many different groups meant that there was less statistical power that could be used to clearly decide which group had better outcomes.

Chris Blattman, a blogger and academic in the area of development economics, with a particular focus on randomized controlled trials, also blogged the study. He expressed two main reservations:[35]

  • The observer-expectancy effect, where the people being asked questions may be subtly influenced in their answers by the experimenter's expectations.
  • The lack of clear positive effect on long-term outcomes, as well as the lack of increased spending on health and education.

See also

References

  1. ^ "GiveDirectly". GiveDirectly. Retrieved November 30, 2012.
  2. ^ "GiveDirectly team page".
  3. ^ a b Goldstein, Dana (December 21, 2012). "Can 4 Economists Build the Most Economically Efficient Charity Ever?". The Atlantic.
  4. ^ "Google Dot Org". www.google.org. Retrieved January 25, 2017.
  5. ^ Hassenfeld, Elie (June 20, 2014). "Update on GiveDirectly". GiveWell. Retrieved May 2, 2020.
  6. ^ Coleman, Isobel (June 20, 2014). "Segovia: A New Player in Cash Transfers". Development Channel blog, Council on Foreign Relations. Retrieved June 21, 2014.
  7. ^ "GiveDirectly - August 2014 Update". August 2014. Retrieved May 2, 2020.
  8. ^ "Blog | GiveDirectly". www.givedirectly.org. Retrieved May 2, 2020.
  9. ^ "What If We Just Gave Poor People a Basic Income for Life? That's What We're About to Test". Slate. April 14, 2016. Retrieved May 2, 2020.
  10. ^ "The largest basic income experiment in history just launched in Kenya". Business Insider. Retrieved January 17, 2018.
  11. ^ "After Harvey, One Group Is Hoping Giving Away Cash Will Help Houstonians Rebuild". NPR News. Retrieved January 17, 2018.
  12. ^ Samuel, Sigal (December 1, 2020). "Is the pandemic making people more generous — or more selfish?". Vox. Retrieved December 29, 2020.
  13. ^ Gharib, Malaka (February 15, 2021). "The Pandemic Pushed This Farmer Into Deep Poverty. Then Something Amazing Happened". NPR News. Retrieved February 15, 2021.
  14. ^ Visram, Talib (December 11, 2020). "How GiveDirectly is finding the poorest people in the world—and sending them cash". Fast Company. Retrieved December 29, 2020.
  15. ^ "What Would Happen If We Just Gave People Money?". FiveThirtyEight. April 25, 2016. Retrieved May 2, 2020.
  16. ^ "Charity To Amp Up Direct Aid Mission In Impoverished East Africa". NPR News. Retrieved January 25, 2017.
  17. ^ Miguel, Edward; Egger, Dennis; Haushofer, Johannes; Niehaus, Paul; Walker, Michael (November 21, 2019). "General equilibrium effects of cash transfers: experimental evidence from Kenya" (PDF). Berkley.edu. Retrieved May 2, 2020.
  18. ^ "Group gives cash aid to rural Kenyans, then studies its effects". PBS NewsHour. April 8, 2017. Retrieved January 4, 2018.
  19. ^ Dolan, Kerry A. "Facebook Billionaire's Good Ventures Donates $25 Million To GiveDirectly, Which Gives Cash To The Very Poor". Forbes. Retrieved January 4, 2018.
  20. ^ Weller, Chris. "The world's largest basic income experiment just received a $5 million donation in bitcoin". Business Insider.
  21. ^ Karnofsky, Holden (November 26, 2012). "Our Top Charities for the 2012 Giving Season". GiveWell. Retrieved May 2, 2020.
  22. ^ "Top charities - November 2012 archived version". GiveWell. November 2012. Retrieved May 2, 2020.
  23. ^ Karnofsky, Holden (December 1, 2013). "GiveWell's Top Charities for Giving Season 2013". GiveWell. Retrieved May 2, 2020.
  24. ^ "GiveDirectly". GiveWell. December 1, 2014. Retrieved May 2, 2020.
  25. ^ Hassenfeld, Elie (December 1, 2014). "Our updated top charities". GiveWell. Retrieved May 2, 2020.
  26. ^ a b "Top charities". GiveWell. Retrieved May 2, 2020.
  27. ^ "Our updated top charities for giving season 2015". November 20, 2015. Retrieved May 2, 2020.
  28. ^ Stone-Crispin, Natalie (June 23, 2016). "Mid-year update to top charity recommendations". GiveWell. Retrieved May 2, 2020.
  29. ^ "GiveDirectly, as of November 2016". GiveWell. November 2016. Archived from the original on November 30, 2016. Retrieved May 2, 2020. Published: November 2016CS1 maint: bot: original URL status unknown (link)
  30. ^ "Our top charities for giving season 2017". November 27, 2017. Retrieved May 2, 2020.
  31. ^ "Our updated top charities for giving season 2018". November 26, 2018. Retrieved May 2, 2020.
  32. ^ "Announcing our 2019 top charities". November 26, 2019. Retrieved May 2, 2020.
  33. ^ Haushofer, Jonathan; Shapiro, Jeremy (October 24, 2013). "Policy Brief: Impacts of Unconditional Cash Transfers" (PDF). Retrieved October 26, 2013.
  34. ^ McKenzie, David (October 27, 2013). "Some thoughts on the Give Directly Impact Evaluation". World Bank. Retrieved November 28, 2015.
  35. ^ Blattman, Chris (October 25, 2013). "And the cashonistas rejoice". Retrieved November 28, 2015.

External links