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Cash TransfersCash transferPositive

GiveDirectly Unconditional Cash Transfers

GiveDirectly / MIT / Princeton · Western Kenya · 2011

Summary

GiveDirectly's Kenya experiment directly challenged the assumption that poor people cannot be trusted with unrestricted cash. Recipients invested primarily in durable assets (livestock, housing), generated returns through income diversification, showed improved psychological well-being, and did not increase spending on alcohol or tobacco. The results challenged the dominant model of in-kind aid transfers and sparked a global debate about whether direct cash is more effective than most targeted programs. Three-year follow-up found effects sustained.

Research question

"Do large unconditional cash transfers to extremely poor households produce lasting improvements in income and well-being?"

Methodology

Intervention

Lump-sum transfers of ~$1,000 USD (roughly annual household income) to randomly selected extremely poor households, with no conditions

Assignment

Randomized controlled trial (household)

Sample size

1,008 households across 60 villages

Primary outcome

Assets, earnings, food security, psychological well-being

Effect estimate

Assets: +58%; earnings: +38%; food security: +20%; psychological well-being significantly improved; no evidence of alcohol or tobacco spending increase; effects sustained 3 years later

Decision

GiveDirectly scaled to millions of transfers; research model replicated in multiple African countries; influenced Kenya and Zambia national cash transfer programs

Result

Positive

Assets: +58%; earnings: +38%; food security: +20%; psychological well-being significantly improved; no evidence of alcohol or tobacco spending increase; effects sustained 3 years later

Evidence strength

Strong

Randomized trial, replicated across multiple sites or studies.

Replication status

Replicated

Institution

GiveDirectly / MIT / Princeton

Location

Western Kenya

Year

2011

Policy area

Cash Transfers

Mechanism

Cash transfer

More from these institutions

Other trials of this mechanism

Cite this entry

GiveDirectly / MIT / Princeton. (2011). GiveDirectly Unconditional Cash Transfers. The Experiment Society Registry. Retrieved from https://www.experimentsociety.org/registry/givedirectly-kenya (primary report: https://www.nber.org/papers/w20583)

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