In 2018, a non-profit organization gave each adult in Ahenyo, a Kenyan village, $500 with no conditions attached. This was a significant sum for people living in extreme poverty, roughly equal to a year’s income. Researchers wanted to see whether direct cash transfers could improve lives more effectively than traditional aid programs. In the past, initiatives like job training, education funding, or microfinance often failed to create long-term economic change. When the researchers returned two years later, the results were surprisingly positive: businesses grew by 65%, families saved and ate more, and social problems like alcoholism and domestic violence decreased. Similar results appeared in other villages, showing that direct cash giving can stimulate entire local economies. However, long-term effects remain uncertain—some studies show the benefits fade over time. Still, the key idea is powerful: people in poverty often understand their own needs better than outsiders. If wealthy nations and philanthropists trusted this principle, extreme poverty could be greatly reduced.
Vocabulary:
• Philanthropy (noun): The practice of giving money or help to people in need.
• Intervention (noun): An action taken to improve a situation, especially by outsiders.
• Roughly (adv): Approximately, not exactly.• Equivalent (adj): Equal in value, amount, or meaning.
• Infrastructure (noun): Basic systems such as roads, power, or schools that support a society.
• Bolster (verb): To support or strengthen something.
• Surrounding (adj): Near or around a particular place.
• Assume (verb): To believe something is true without proof.
• Silver bullet (noun): A simple solution to a complex problem.
• Timeline (noun): The period or sequence of events over time.
Source: Ted-ED