Villagers pose with their identity cards as they stand in line to open a bank account so that they can receive cash grants in a village at Ajmer in the desert Indian state of Rajasthan, January, 2013.  
Stringer / Reuters

In a Foreign Affairs article last year, we wrote what we hoped would be a provocative argument: “Cash grants to the poor are as good as or better than many traditional forms of aid when it comes to reducing poverty.” Cash grants are cheaper to administer and effective at giving recipients what they want, rather than what experts think they need

That argument seems less radical by the day. Experimental impact evaluations continue to show strong results for cash grants large or small. In August, David McKenzie of the World Bank reported results from a study of grants of $50,000 on average to entrepreneurs in Nigeria that showed large positive impacts on business creation, survival, profits, sales, and employment, including an increase of more than 20 percent in the likelihood of a firm having more than ten employees. Also this year, Chris Blattman and Stefan Dercon, the chief economist at the United

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  • MICHAEL FAYE is Co-Founder of GiveDirectly and Segovia Technology.
  • PAUL NIEHAUS is Associate Professor of Economics at the University of California, San Diego, and Co-Founder of GiveDirectly and Segovia Technology. 
  • CHRISTOPHER BLATTMAN is Associate Professor of Political Science and International Affairs at Columbia University.
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