Speaker 1: Pushkin. Hey, Happiness Lab listeners, You're probably pretty used to
Speaker 1: me dispelling the myth that money can buy happiness, but
Speaker 1: this episode is a bit of an exception. Today I'll
Speaker 1: be telling you that sometimes cold, hard cash, no strings attached,
Speaker 1: can really do amazing things like transforming lives. In fact,
Speaker 1: I'll be giving you the chance to use a small
Speaker 1: amount of your own cash to make a huge difference
Speaker 1: to hundreds of families.
Speaker 2: Kabobo, I think, is a great place if people want
Speaker 2: someone to support people there are living in really desperate situation.
Speaker 2: They lack almost everything.
Speaker 1: But more on that in a moment. The holiday season
Speaker 1: is upon us, that most wonderful time of the year,
Speaker 1: and there are indeed lots of wonderful, happiness inducing activities
Speaker 1: about to take place, from festive decorating to family gathers
Speaker 1: to parties. But this wonderful time of the year is
Speaker 1: also known for another happiness boosting tradition, giving, and I
Speaker 1: don't just mean wrapping gifts. This is the season to
Speaker 1: help people in need. The importance of generosity has even
Speaker 1: been codified into one of my favorite annual occasions, Giving Tuesday,
Speaker 1: the Tuesday after Thanksgiving, coming after consumption oriented Black Friday
Speaker 1: and Cyber Monday is now a day when many charities
Speaker 1: launch fundraising campaigns and many people commit to donating to
Speaker 1: good causes. Traditionally on Giving Tuesday, We've brought you an
Speaker 1: episode about the happiness benefits of charity. But we don't
Speaker 1: just focus on any old giving. No, we want people
Speaker 1: to give as effectively as possible.
Speaker 3: The reason why we're spending money on charity, let's say,
Speaker 3: is because we really want to help. We want to
Speaker 3: do some good, and very few of us would say, well,
Speaker 3: I want to do good, but not that much good.
Speaker 1: This is Josh Green, a Harvard psychology professor and one
Speaker 1: of the brains behind giving dot org.
Speaker 3: Most people don't know this. The most effective charities in
Speaker 3: the world are orders of magnitude more effective than typical charities.
Speaker 3: And when I say effectiveness, I'm talking about how many
Speaker 3: lives can you save for per dollar, per thousand dollars
Speaker 3: or ten thousand dollars, or how much can you improve
Speaker 3: people's lives.
Speaker 1: And that's where giving multiplier dot org comes in. It
Speaker 1: allows you to give to the charities you already care about,
Speaker 1: but to also contribute to one of these super effective organizations.
Speaker 1: Preventing disease and curing blindness. With every dollar, you enter.
Speaker 3: The amount of money that you want to donate, and
Speaker 3: then we have this very nifty little slider where you
Speaker 3: put the amount in and then you can slide it
Speaker 3: to decide, Okay, do I want to split it fifty
Speaker 3: to fifty or do I want to give like eighty
Speaker 3: percent to the one charity and twenty percent to the other.
Speaker 1: Over the last two years, listeners have been going to
Speaker 1: giving Multiplier dot org slash Happiness Lab and being pretty
Speaker 1: hardcore with their generosity. You've raised nearly half a million
Speaker 1: dollars to date, and a lot of that money has
Speaker 1: gone to super effective charities, which is totally incredible. If
Speaker 1: you like splitting your donations between your favorite cause and
Speaker 1: an effective charity, please go back to giving Multiplier dot
Speaker 1: org slash Happiness Lab. But this year we want to
Speaker 1: zoom in on just one of the amazing nonprofits that
Speaker 1: Giving Multiplier works with, one with an incredibly simple mission.
Speaker 1: It's called giving directly and that's basically its mission to
Speaker 1: simply give money away, which might at first glance sound
Speaker 1: kind of irresponsible. Right, charities should be carefully spending your
Speaker 1: donations buying medicines and school textbooks or digging wells. But
Speaker 1: give directly transfers cash to people in extreme poverty, no
Speaker 1: strings attached, no questions asked, and trust them to spend
Speaker 1: it to improve their own lives. This idea challenges a
Speaker 1: lot of our prejudices. Can we really be sure that
Speaker 1: people will use the money well if we don't control
Speaker 1: how they spend it.
Speaker 4: My name is Drying Jow and called me Jay Z
Speaker 4: an associate professor in psychology and Sustainability at the University
Speaker 4: of British.
Speaker 1: Columbia Happiness Scientists. It's an expert on how people make
Speaker 1: decisions when they don't have enough money for their basic needs.
Speaker 1: It's a problem she's experienced.
Speaker 4: I grew up in poverty because I was born and
Speaker 4: raised in China in the ninety eighty, so I grew
Speaker 4: up in poverty for the first ten years of my life.
Speaker 4: But when I got my PhD from Princeton, I was
Speaker 4: homeless for three months my student status expired. I was
Speaker 4: waiting for my work permit from the Canadian consulate, which
Speaker 4: was on strike indefinitely. I basically house served for three months,
Speaker 4: probably slept on ten different couches that I can keep
Speaker 4: track of and it was rough. It was definitely very difficult.
Speaker 1: Jay Z's lived experience has informed her research, but it's
Speaker 1: also been a source of continued pain, especially when people
Speaker 1: challenge her right to talk about poverty or dispute her
Speaker 1: life story.
Speaker 4: I've gotten a lot of the comments from the public
Speaker 4: on you're not really homeless, you are such a privileged person,
Speaker 4: you know, what do you know about poverty? Then I
Speaker 4: have to tell them about my own lived experience, and
Speaker 4: then they try to discount it by saying, you're not
Speaker 4: on the street, You're not the ones that we see
Speaker 4: on the street that are using substance and sleeping outdoors.
Speaker 4: And my response to that is people on the street,
Speaker 4: like the typical homeless person that we have in mind
Speaker 4: is not the actual typical homeless person. In reality, people
Speaker 4: who are sleeping on the streets using substance in daylight
Speaker 4: only represent I would say less than ten percent. The
Speaker 4: vast majority of people are hidden. They are not in
Speaker 4: public view because they're in shelters, they're couch serving, they're
Speaker 4: sleeping their cars, they're sleeping in abandoned buildings. And therefore
Speaker 4: the public perception of homelesses is highly distorted from reality.
Speaker 1: Talk to me first about the usual approach to solving homelessness.
Speaker 1: How do people normally try to target this issue.
Speaker 4: Yeah, the typical approaches to homelessness is to provide emergency
Speaker 4: services like shelters. You can only stay for one month,
Speaker 4: that's the kind of the maximum length of stay. Usually
Speaker 4: a social world is assigned to you in the shelter
Speaker 4: to help you find housing and food, et cetera. Or
Speaker 4: health services so detox programs if you have substance use issues,
Speaker 4: et cetera. Those are, in my mind paternalistic services because
Speaker 4: it's already assuming that people need somebody else to tell
Speaker 4: them what to do. That's the social workers aspect, and
Speaker 4: that I think these approaches are not working. I mean
Speaker 4: this is not just my personal opinion. It's actually evidenced
Speaker 4: by this exploding homeless populations in North America. So it's
Speaker 4: clear that the current approaches are not helping reduce homelessness.
Speaker 4: And that's what got us thinking, is there something else
Speaker 4: we need to try?
Speaker 1: This led jay Z to study the effectiveness of a
Speaker 1: radical solution when many people might consider naive or irresponsible.
Speaker 1: What are known as cash transfer programs.
Speaker 4: So cash transfer is giving money directly to people living
Speaker 4: in poverty. This can happen with some conditionality attached to it,
Speaker 4: like you need to participate in finish this you know,
Speaker 4: detox program to get paid, or the cash can be unconditional,
Speaker 4: meaning you're just getting the cash with no strains, no
Speaker 4: requirement attached. A lot of the current welfare programs in
Speaker 4: the world focus on asking people to jump through hoops
Speaker 4: and file applications for various income assistants or welfare programs.
Speaker 4: Those hurdles can be taxing for people living poverty. They
Speaker 4: have multiple jobs to juggle with, they already short on physical, cognitive,
Speaker 4: and time bandwidth, and asking people to do extra things
Speaker 4: so they can qualify or get social assistance is I
Speaker 4: think actually counterproductive, and this is why we don't see
Speaker 4: a huge take up rate of the government provided social assistance.
Speaker 4: So I think that's partly why the current welfare programs
Speaker 4: are not really helping people get out of poverty. And
Speaker 4: another aspect of this is that the welfare programs are
Speaker 4: designed with paternalistic mindsetting. By that I may dictate what
Speaker 4: people in poverty should and should not get, whereas cash
Speaker 4: transfer is the opposite. It basically tells people you can
Speaker 4: do whatever you want with the cash. We believe in you.
Speaker 4: You make the best decisions for yourself.
Speaker 1: And so walk through the nuts and bolts of the
Speaker 1: cash transfer program you applied in Vancouver. How did it work?
Speaker 4: So we deployed a team of interviewers to twenty two
Speaker 4: shelters in Vancouver to recruit participants. We ended up recruiting
Speaker 4: one hundred and fifteen people into the trial and we
Speaker 4: randomly assigned fifty of them to receive a one time,
Speaker 4: unconditional cash transfer of seven thousand, five hundred dollars. And
Speaker 4: the reason for seventy five hundred dollars was that it
Speaker 4: was the annual income assistance in British Columbia back in
Speaker 4: twenty sixteen when we designed the trial. They also receive
Speaker 4: income assistance also, so this is in addition to the
Speaker 4: welfare checks they're getting, not to replace what they're currently getting.
Speaker 4: Where we carefully screen people based on substance use, alcoholou use,
Speaker 4: and psychiatric symptoms. So this particular subset representative on a
Speaker 4: third of the shelter population in Vancouver.
Speaker 1: When you followed up, what did you find?
Speaker 4: So we followed them for a year and we found
Speaker 4: that this cash resfer reduced homelessness by ninety nine days
Speaker 4: per person, and that's pretty significant. I mean, I couch
Speaker 4: surved three months, and I had great social support during
Speaker 4: those months, but putting somebody into stable housing three months
Speaker 4: earlier is tremendous. It reduced risks of harm assaults, developing
Speaker 4: further substance use or mental health issues, and also importantly,
Speaker 4: they became less reliant on social services over one year.
Speaker 4: So each cash recipient actually saved the government eighty two
Speaker 4: hundred and seventy seven dollars on average, So the net
Speaker 4: savings was over seven hundred dollars. That suggests that this
Speaker 4: cash resker is cost effective. It's less than what we
Speaker 4: currently spend on managing homelessness.
Speaker 1: But I think a lot of people have this paternalistic
Speaker 1: instinct because they start worrying that people might not spend
Speaker 1: the money on things that are good. I think there's
Speaker 1: this stereotype that low income people are going to spend
Speaker 1: the money on drugs or quite frivolously. You know, what
Speaker 1: does the data really say when it comes to cash
Speaker 1: transfer programs.
Speaker 4: Yeah, you point to an excellent barrier for a lot
Speaker 4: of public policy, which is people's stereotype of those who
Speaker 4: live in poverty. But I think this stereotype is not
Speaker 4: only wrong but also harmful. It's wrong because that's not
Speaker 4: what data says. The evidence, including our studies, says that
Speaker 4: when people receive the cash, even when they're homeless, when
Speaker 4: they're in extreme poverty, they actually don't really spend the
Speaker 4: money on alcohol and drugs and these temptation goods. Instead,
Speaker 4: they spend it on rant food, things that you need
Speaker 4: to survive. And there are dozens and dozens of studies
Speaker 4: out there to show cash transfers actually don't increase spending
Speaker 4: on temptation goods. Instead, there's a significant decrease in spending
Speaker 4: on temptation goods after the cash transfer.
Speaker 1: It's almost like people don't need the temptation goods as
Speaker 1: much when they aren't stressed, because they can, you know,
Speaker 1: put food on the table in these things.
Speaker 4: Right exactly. I mean, that's the the kind of the
Speaker 4: self medication part of poverty, or at least with the
Speaker 4: homeless population of Vancouver. What we found was there's actually
Speaker 4: a marginal decline in substance use severity after getting the
Speaker 4: cash transfer. So what this suggests is that people don't
Speaker 4: need to use alcohol and drugs when they're in back
Speaker 4: in housing. When you're in poverty, you're short on cognit
Speaker 4: band with you actually to use substance to even survive
Speaker 4: on the street. Some of our participants say they actually
Speaker 4: need to stay warm with alcohol and that's why they
Speaker 4: drink on the street. But once they get back into housing,
Speaker 4: they don't need alcohol anymore. So it's kind of a
Speaker 4: survival coping mechanism instead of the cause of homelessness in
Speaker 4: the first place. That's why this stereotype is wrong, and
Speaker 4: I think it comes from the misconception that people end
Speaker 4: up in poverty because they screwed up, they made mistakes,
Speaker 4: therefore they cannot be trusted with money. That's typically not
Speaker 4: the case. People become homeless because they couldn't pay rent
Speaker 4: for two or three months and then eventually they're evicted
Speaker 4: by their landlords, and that's the primary reason for homelessness,
Speaker 4: at least in Vancouver. I just think that our idea
Speaker 4: of somebody in poverty or homelessness needs to change. That's
Speaker 4: why I did the subsequent studies after the cash ranks,
Speaker 4: for studies looking at public perception. The average person thinks
Speaker 4: that the cash recipients will spend more than three hundred
Speaker 4: dollars on alcoholic drugs and cigarettes per month. That's their prediction,
Speaker 4: whereas in reality the spending was.
Speaker 1: Only around one hundred dollars.
Speaker 4: It's actually less an average person spends on alcoholic drugs
Speaker 4: and cigarettes on a monthly basis.
Speaker 1: It just seems so obvious then that we need to
Speaker 1: start using cash transfers more often to alleviate poverty.
Speaker 4: Oh completely. So first of all, people actually I see
Speaker 4: this as justification biers all the time. They think the
Speaker 4: governments are doing great when it comes to poverty with homelessness.
Speaker 4: What they don't know is how much we're currently spending
Speaker 4: on homelessness in the US. You know, the government is
Speaker 4: spending over eighty thousand dollars proportion per year, so they
Speaker 4: don't know that poverty is extremely costly. If we use
Speaker 4: the eighty thousand dollars to do the cash transfers, I
Speaker 4: feel like we can actually get a lot of savings
Speaker 4: and actually reduce poverty meaningfully as opposed to the status.
Speaker 1: Cool j Z's work shows that cash transfers just giving
Speaker 1: people cash directly saves money while solving tough problems of
Speaker 1: homelessness and poverty. In North America. But what about extreme poverty. Well,
Speaker 1: there's one nonprofit that gives money to the world's poorest
Speaker 1: people and things Happiness Lab listeners can transform the lives
Speaker 1: of an entire village. We'll learn more when the Happiness
Speaker 1: Lab returns in a moment. Thanks so much for taking
Speaker 1: the time for this. We're so excited to be collaborating
Speaker 1: with Give Directly and former politician Rory Stewart used to
Speaker 1: be in charge of Britain's four and eight budget billions
Speaker 1: and billions and billions of dollars. He now works with
Speaker 1: Give Directly, the nonprofit we're partnering with to send money
Speaker 1: straight to people in one poor village in Africa.
Speaker 2: Giving people cash directly, it's a very radical idea because
Speaker 2: traditionally people used to say, give someone a fish they
Speaker 2: eat for a day, teach them to fish they eat
Speaker 2: for a lifetime, and cash seems like the ultimate fish
Speaker 2: giving program. The strange thing is that when we've studied
Speaker 2: this scientifically, the astonishing revelation is that cash outperformost all
Speaker 2: the traditional programs. Just giving someone cash needs to better
Speaker 2: nutrition outcomes than running a nutrition training program. Now why
Speaker 2: is this? And we see these results again and again.
Speaker 2: I mean sort of three hundred of these studies, so
Speaker 2: many that we can't doubt it anymore. And it seems
Speaker 2: to be that the reason for this is that what
Speaker 2: people in villages around the world in extreme poverty lack
Speaker 2: is not knowledge, it's cash. So you turn up thinking
Speaker 2: that what you need to do is teach people to fish.
Speaker 2: But the truth of the matter is they either already
Speaker 2: know how to fish, don't have the money for a
Speaker 2: fishing rod, or they don't want to fish, they want
Speaker 2: to open a bakery.
Speaker 1: And my understanding is that this is something that you
Speaker 1: came to like slowly over time, that you weren't necessarily
Speaker 1: a huge fan of cash transfers initially, but that you
Speaker 1: came around to the data. You know, So talk about
Speaker 1: your path to changing your mind on this.
Speaker 2: When I was the Minister responsible for International Development in
Speaker 2: the United Kingdom, we were then spending nearly twenty billion
Speaker 2: dollars a year on international development, I was still buying
Speaker 2: into the old system. I still thought it was all
Speaker 2: about training people, teaching people, and I thought, well, if
Speaker 2: we give away cash, what are all doing. You know,
Speaker 2: I've got thousands of civil servants all over the world.
Speaker 2: What's the points of their master's degrees in international development?
Speaker 2: There's speciality in health or education. If we're just going
Speaker 2: to give people cash, it's a very threatening model. So
Speaker 2: my mind was changed really by visiting a community on
Speaker 2: the Rwanda Burundi border which was funded by giftdirectly. It
Speaker 2: was life changing, I mean absolutely life changing. This was
Speaker 2: almost too years ago now, because I saw that giving
Speaker 2: about in those days seven hundred and fifty dollars per
Speaker 2: household to a village of about one hundred houses completely
Speaker 2: transformed people's lives in a way that I could never
Speaker 2: have guessed and in a way that I knew perfectly
Speaker 2: well the international development community would never have achieved with
Speaker 2: its normal programs. So what does that mean. That means
Speaker 2: that if you were to go to that village, you
Speaker 2: would find that within about three months, suddenly you go
Speaker 2: from almost nobody having a tin roof to almost everybody
Speaker 2: having a tin roof. You suddenly find electrification going from
Speaker 2: about forty percent to about eighty percent, livestock ownership again
Speaker 2: going from about a third of people to almost eighty
Speaker 2: percent to people having livestock, huge improvements in the number
Speaker 2: of kids in school in Bone density, and you're achieving
Speaker 2: it all for a village to that size, for I
Speaker 2: suppose probably about one hundred thousand dollars. Now, if you
Speaker 2: were to turn around and say to a traditional nonprofit,
Speaker 2: how much would it cost you to achieve all those
Speaker 2: things I've just been talking about, the answer would be millions,
Speaker 2: because they would go and they would survey every house,
Speaker 2: they'd try to procure the metal roofs, they'd bring in
Speaker 2: their engineers, they'd run education enrollment programs, they'd run nutrition programs,
Speaker 2: et cetera. And they would probably achieve potentially even less
Speaker 2: for much much more money because they're not tapping into
Speaker 2: the knowledge of the local individual. The point is that
Speaker 2: every individual in each house in Thatt village has a
Speaker 2: separate set of needs and we need to respect that,
Speaker 2: give them dignity given freedom to address them. And that
Speaker 2: turns out to be the most effective way of doing
Speaker 2: development as well.
Speaker 1: And so given all these successes, I'm wondering why more
Speaker 1: organizations aren't just giving cash away. You know, why are
Speaker 1: people skeptical given all these amazing data suggesting that it
Speaker 1: works really well.
Speaker 2: I think there's an element of vanity. I think a
Speaker 2: lot of philanthropists don't just want to give cash. They
Speaker 2: want to feel that they've got a brilliant business brain
Speaker 2: and they've set up an amazing company, and therefore what
Speaker 2: people need is not their money but their brain. Neither
Speaker 2: are endless stories of wealthy people thinking that they'd be
Speaker 2: embarrassing to their friends when they say, what do you
Speaker 2: do feel flaxtory? Oh, I just give cash. They want
Speaker 2: to have an interesting story at a dinner table. They
Speaker 2: want to be able to say, oh, no, I've invented
Speaker 2: a sea saw which also acts as a pump for water,
Speaker 2: so when children go on the sea saw at pumps
Speaker 2: water of the village. Or I've realized that if you
Speaker 2: give chickens to people, the chickens have eggs, and the
Speaker 2: eggs have more chickens. They want to feel that they've
Speaker 2: found some new idea, some silver bullet. They're not at
Speaker 2: all comfortable with the idea that actually their ideas are
Speaker 2: much less important than their money.
Speaker 1: And so that's kind of a wealthy philanthropists version of
Speaker 1: why they're a little bit worried about giving money directly.
Speaker 1: What do you think about people who are just, you know,
Speaker 1: I'm going to donate, you know, fifty dollars one hundred
Speaker 1: dollars someone who's donating a small amount, but that has
Speaker 1: some worries about whether or not that money will go
Speaker 1: to something really useful.
Speaker 2: Well, I think if you're donating a small amount, there's
Speaker 2: almost nothing better than cash. If you give fifty or
Speaker 2: one hundred dollars to a traditional nonprofit, I don't know
Speaker 2: what they do with that money. Their budgets are enormous,
Speaker 2: they have incredible number of staff, Their implementation and costs
Speaker 2: are very high, so that money will disappear very quickly.
Speaker 2: But fifty or one hundred dollars delivered to someone in
Speaker 2: extreme poverty has one hundred times the impact that it
Speaker 2: would in the United States. It like giving five thousand
Speaker 2: or ten thousand dollars to someone in the United States.
Speaker 2: It might be the recipient's first chance to have a
Speaker 2: roof on their head, the first chance to get the
Speaker 2: children to school, the first chance to eat more than
Speaker 2: one meal a day.
Speaker 1: And that's the kind of thing that Give Directly does
Speaker 1: so talk a little bit about this organization and how
Speaker 1: it really gets money directly to the people who need it.
Speaker 2: Well. Give Directly was the brainchild of some economists that
Speaker 2: Harvard and MIT who began seeing all this data and thought, well,
Speaker 2: why don't we try to see what would happen if
Speaker 2: we just gave cash? And they started in Kenya and
Speaker 2: they learned by doing. Initially, they took loans from their
Speaker 2: parents and they started giving money and the results were
Speaker 2: absolutely staggering, and it's grown since then very dramatically. Give
Speaker 2: Directly was the fastest growing nonprofit in the world a
Speaker 2: couple of years ago. It's funded by everything from large
Speaker 2: donations to small donations, but its key ethos is recipients first.
Speaker 2: In other words, every policy decision in the organization is
Speaker 2: determined by what is in the best interests of recipients
Speaker 2: and above all, how do you get the most money
Speaker 2: to recipients with the least bureaucracy.
Speaker 1: And so, as part of this Giving Tuesday episode, we're
Speaker 1: asking Happiness Lab listeners to consider donating to a special
Speaker 1: Give Directly campaign. This is a campaign that's going to
Speaker 1: be giving money directly to people in Kebobo, which is
Speaker 1: in the Kagali province of Rwanda. Tell me a little
Speaker 1: bit about life in Kebobo and why Give Directly is
Speaker 1: trying to do some campaign there.
Speaker 2: Well, Kibobo, I think is a great place if people
Speaker 2: want someone to support. It's a village. It's a village
Speaker 2: with just over ninety households, a typical small village in Rwanda,
Speaker 2: and people there are living in really desperate situation. They
Speaker 2: lack almost everything, lack clean drinking water, so you will
Speaker 2: see communities going down to a dirty river bed to
Speaker 2: try to get their water, and of course that has
Speaker 2: a huge health impact in terms of boraborn diseases. Many
Speaker 2: of them lack decent shelter. The school is a long
Speaker 2: way away, the clinics are a long way away. Getting
Speaker 2: anywhere is difficult. Setting up a small business is difficult
Speaker 2: because the road infrastructure just isn't there to support you.
Speaker 2: So you're held back by public infrastructure. But you're also
Speaker 2: held back primarily by the fact you don't have simple cash.
Speaker 2: Getting a little bit of cash is what will allow
Speaker 2: you to fix your house, buy a cow which could
Speaker 2: have a calf, provide milk for your family, set up
Speaker 2: a small tailoring business for a bakery, or just buy
Speaker 2: a motorbike in order to get into town. Provide the
Speaker 2: support to get your children's uniforms and textbooks into school,
Speaker 2: get a relative who's ill to the local hospital, start
Speaker 2: investing a little bit in your land, buying some seeds,
Speaker 2: buying some fertilizer, these things that are genuinely life transforming.
Speaker 2: It's one village, and if we were able to raise
Speaker 2: one hundred thousand dollars through the Happiness Lab, that would
Speaker 2: be enough to cover almost everybody in that community and
Speaker 2: really transform their lives. And a small donation of fifty
Speaker 2: one hundred dollars goes a very long way, because we're
Speaker 2: looking for one thousand dollars per household that would cover
Speaker 2: generally two adult individuals and a number of children. And yeah,
Speaker 2: anything would go a very long way.
Speaker 1: And with the caveat that, the whole point of giving
Speaker 1: directly is that the people in Kobobo will get to
Speaker 1: use the cash or whatever they want. What's the expectation
Speaker 1: of the kinds of things they're going to use this
Speaker 1: cash for.
Speaker 2: The majority of people will invest in running electricity into
Speaker 2: the community, fixing the roofs of their houses, getting livestock cows,
Speaker 2: providing nutrition for their children, meals, investing in small businesses
Speaker 2: in many cases, running clean water pipes into the community.
Speaker 2: All these kind of things that addressing the basic needs,
Speaker 2: which will be very different village to village, house to house.
Speaker 2: But the great thing about cash is it's flexible.
Speaker 1: And this is really powerful because it suggests that these
Speaker 1: kinds of donations aren't just ones where you're adding to
Speaker 1: some administrators hefty fees, Like the cash is really going
Speaker 1: to go vieo mobile. I for want into people's pockets directly.
Speaker 2: Right right exactly. And that's the fundamental thing. We believe
Speaker 2: that individuals know better than anyone else what they need
Speaker 2: and how to spend that money. So if you think
Speaker 2: about a group of your friends or family, you, Laurie
Speaker 2: might want to be setting up a small business because
Speaker 2: by some miracle, your kids already in school. I might
Speaker 2: not have my kid in school, so that might be
Speaker 2: my priority. My neighbor might already have a small business
Speaker 2: and a kid in school, but might have a very
Speaker 2: sick aunt. The person four dolls down might be blind,
Speaker 2: and what they would really need is someone to support
Speaker 2: them in bringing water up to their house and getting
Speaker 2: a decent front door. But what you can't do as
Speaker 2: an outsider is guess all these things from five thousand
Speaker 2: miles away. What the cash does is let the individuals
Speaker 2: in those communities address their own needs directly, and.
Speaker 1: A lot of what we talk about on the Happiness
Speaker 1: Lab are the kind of benefits that come from doing
Speaker 1: these kind pro social acts, not just to the people
Speaker 1: who receive these donations, but to the people who are
Speaker 1: doing the donating. As you've worked with give directly and
Speaker 1: kind of seen the impact of their work. Has this
Speaker 1: really changed your happy Do you think it can change
Speaker 1: the happiness of the people who are making these small donations.
Speaker 2: Absolutely? I mean, for me, visiting that village on there
Speaker 2: around a Brundi border, realizing that giving eleven hundred dollars
Speaker 2: could transform somebody's life was extraordinary. I mean it was
Speaker 2: a great gift to me, not to them, to feel
Speaker 2: that I was able to do some good in the
Speaker 2: world so simply and so straightforwardly. You know, the woman
Speaker 2: who I was supporting, I mean, in her house there
Speaker 2: was only a single object, which was one metal pot.
Speaker 2: She didn't have a plastic bucket or a chair or
Speaker 2: a mattress or anything, and she was looking after three
Speaker 2: grandchildren on six dollars a month. And I think it's
Speaker 2: deeply fulfilling to be able to engage with supporting communities
Speaker 2: and I think give directly is also quite good at
Speaker 2: keeping you up to date on the progress those communities
Speaker 2: and making so that you can have a feeling of
Speaker 2: what the practical impact is.
Speaker 1: But yet there's so much pushback about the possibility of
Speaker 1: just giving cash directly. I mean, is this something you
Speaker 1: find frustrating?
Speaker 2: How do you deal with it without being too geek
Speaker 2: about it? I would say, follow the evidence, and the
Speaker 2: evidence is that people put the money to better use
Speaker 2: than almost anything else. When I say evidence, I mean
Speaker 2: really compelling randomized control trials like medical trials, where you're
Speaker 2: following thousands of people a random group over many years,
Speaker 2: and what you find is, yes, a few individuals might
Speaker 2: misuse money, but by and large, there is almost no
Speaker 2: intervention in poverty which has the impact that cash has.
Speaker 2: And I know it's a difficult step. It was a
Speaker 2: difficult step for me when I was working international, but
Speaker 2: I was just like, what are you talking about. I mean,
Speaker 2: we've spent decades trying to come up with cunning plans
Speaker 2: and building things for other people, and now you're saying
Speaker 2: we'd be better off just giving them cash and stepping
Speaker 2: out the way. I know, that's a very radical, difficult view,
Speaker 2: but particularly in a world that's understandably worried about colonialism,
Speaker 2: about patronizing development aid, this is the most radically respectful
Speaker 2: thing you can do, because you're saying that people in
Speaker 2: extreme poverty no more care more, can do more than
Speaker 2: I can. Expecting their dignity, You're giving them freedom of choice,
Speaker 2: and you're trusting them to spend the money far better
Speaker 2: than any outside it could do on their behalf.
Speaker 1: I hope this episode has convinced you that cash transfers
Speaker 1: are a great way to help people in need. But
Speaker 1: knowing about the effectiveness of giving directly is only the
Speaker 1: first step to really see the power of cash transfer.
Speaker 1: Nonprofits like GiveDirectly need that cash to transfer. So this
Speaker 1: Giving Tuesday, why don't you join me and other Happiness
Speaker 1: Lab listeners to help the people of Cabobo. Last year,
Speaker 1: our listeners raised a lot of money for people in need,
Speaker 1: but this year we might be able to completely lift
Speaker 1: an entire village out of extreme poverty. So head right
Speaker 1: now to give directly dot org slash happiness. That's give
Speaker 1: directly dot org slash happiness and give what you can,
Speaker 1: even if it's just a couple of bucks. As we
Speaker 1: heard in this episode that three dollars that you might
Speaker 1: waste on a cup of coffee may be able to
Speaker 1: do a lot more good when you give it directly,
Speaker 1: both for the people in need and for your own
Speaker 1: sense of happiness and purpose. That website again is GiveDirectly
Speaker 1: dot org slash happiness. The Happiness Lab is co written
Speaker 1: and produced by Ryan Dilley. Our original music was composed
Speaker 1: by Zachary Silver, with additional scoring, mixing and mastering by
Speaker 1: Evan Viola. Jess Shane and Alice Fines offered additional production support.
Speaker 1: Special thanks to my agent, Ben Davis and all of
Speaker 1: the Pushkin crew. The Happiness Lab is brought to you
Speaker 1: by Pushkin Industries and me, Doctor Larrie Santos