by Christopher Blattman and Paul Niehaus
Foreign Affairs, Vol. 93, Nr. 3, May/June 2014
Studies have shown that the world’s poorest people do not squander cash transfers, even when there are no strings attached. An extreme example comes from a recent experiment run by one of the authors (Blattman), Julian Jamison, and Margaret Sheridan. In 2010-2013, they gave unconditional grants of US $200 to some of the least disciplined men to be found: drug addicts and petty criminals in the slums of Liberia. Bucking expectations, these recipients did not waste the money, instead spending the majority of the funds on basic necessities or starting their own businesses. If these men didn’t throw away free money, who would?