Saturday, April 09, 2016

Poor Economics - Granular has a better ROI

I recently read the work Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, by Abhijit Banerjee and Esther Duflo.
In their work Banerjee and Duflo provide research based reflections on global attempts to fight poverty. They take a look at education, health care, micro-lending, micro-saving, and policy/political reinvention - just about everything that's been a movement in poverty fighting in the last couple of decades. What they discovered, when you get past the ancedotal stories, is that it is incredibly difficult to alter poverty at a macro level.
Some of their best data reveals that granular sized endeavors, such as the simple act of reporting to a community how much money makes it to a local school, adds a measure of accountability that moves mountains.
The largest take-away from the book was the primary importance of hope and a future. Without the intangibles of hope and perspective of a better future, measures to fight poverty are relatively short-lived and sterile. With hope and a sense of a future that can be better than today people will save money, delay spending, take care of their health, invest in roads and infrastructure, take reasonable risks with capital, etc.
One area this researchers did not study was the impact of the church or spiritual communities to share  the intangibles of a hope and a future.

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