Unconditional cash transfers are the New Hot Thing™ in development right now. I’m myself quite a fan of this idea and wish that it would be employed more broadly. Now one of the NGOs at the forefront of this particular movement is taking an even more radical step. In the words of Michael Faye and Paul Niehaus of GiveDirectly in Slate:
We’re planning to provide at least 6,000 Kenyans with a basic income for 10 to 15 years. These recipients are some of the most vulnerable people in the world, living on the U.S. equivalent of less than a dollar. And we’re going to work with leading academic researchers, including Abhijit Banerjee of MIT, to rigorously test the impacts.
An unconditional basic income happens to be another policy that I’m a huge fan of. Based on the limited evidence we have (nobody actually ever tried this on a national level), a basic income can have tremendous impacts on health and education, no matter if in developed or underdeveloped countries.
In the African context, there has been one similar project in Namibia in 2008 which showed promising early results, but which was not accompanied by adequate research and only lasted for a couple of years. Alaska has a very low basic income derived from oil profits and a German initiative doles out one-year basic incomes funded by donations. The idea is picking up steam, though, with Switzerland poised to hold a referendum on a national basic income, which would give all Swiss adults a basic income of about $1,650 per month, no questions asked. If you want a broad overview over the discussion about basic incomes (in industrialized nations), the current episode of popular radio show/podcast Freakonomics has you covered.
I really hope that GiveDirectly’s initiative in Kenya succeeds and produces reliable data on the effect of a guaranteed basic income in the setting of a developing economy (which is a slightly different proposition from a basic income in an industrialized rich country).