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Give Directly - Unconditional Cash Transfers to Lift Human Capital

Geoff Riley

30th January 2023

I used this short video clip from Give Directly when discussing pro-poor development strategies and measures designed to overcome the savings-investment gap.

The Chair of Give Directly is Rory Stewart - co-host of The Rest is Politics podcast.

"After decades of minimal results from international aid, giving cash directly to Africans would have a serious impact. Cash works because it does not require outsiders to guess what a community needs; they decide for themselves."

GiveDirectly is a nonprofit organization that provides unconditional cash transfers to people living in extreme poverty. The organization operates in several countries in Africa, using digital payments to transfer money directly to recipients' mobile phones. The idea is to empower people to meet their own needs and improve their lives.

What are the main arguments in favour of a universal basic income for low income countries?

A Universal Basic Income (UBI) is a guaranteed minimum income provided to all citizens, regardless of their employment status or income level.

The main arguments in favor of a UBI for low-income countries are:

  1. Poverty Reduction: UBI can provide a minimum income floor for all citizens, reducing poverty and inequality.
  2. Financial Security: UBI can provide financial security to all citizens, enabling them to cope with unexpected expenses and life events.
  3. Improved Health and Education Outcomes: UBI can improve health and education outcomes by reducing stress and anxiety and providing resources for basic needs.
  4. Simplicity: UBI is simple and easy to administer, reducing the need for complex welfare programs and reducing the potential for corruption.
  5. Encourages Entrepreneurship: UBI can provide financial security for individuals to take risks and start their own businesses, leading to job creation and economic growth.
  6. Supports Women's Empowerment: UBI can improve the financial security of women, who are often disproportionately affected by poverty and are less likely to have access to financial resources.
  7. Reduces Crime: UBI can reduce crime by providing a basic income to individuals who may otherwise resort to illegal activities to meet their basic needs.

UBI is a complex policy with a number of trade-offs, and there are valid concerns about its implementation, financing, and potential impact on work incentives. Nevertheless, proponents of UBI argue that it has the potential to address some of the most pressing challenges facing low-income countries, and that it is worth exploring as a policy option.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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