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Comment by logicchains | Hacker News Reader

Just giving money doesn't necessarily help; see for instance the failure of foreign aid to Africa: https://www.lejournalinternational.fr/Foreign-aid-is-hurting.... Supporting development requires creating the institutions and providing the education to support participation in the modern economy, as Asia has done over the past half century, lifting hundreds of millions of people out of poverty into first-world living conditions. Free money can actually be detrimental to this: for instance the https://en.wikipedia.org/wiki/Resource_curse , where countries with easy income from significant natural resource wealth actually experience worse development outcomes.

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"[..] countries with easy income from significant natural resource wealth actually experience worse development outcomes."

They develop worse outcomes because all the profit goes to a few extractive elites in the country and in foreign powers.

Foreign aid has, I think, a very efficient path to try: just give unconditional money, not strings attached, to the poorest people of the country. You are helping the people that more need it, they know exactly what they need, and they will expend the money in the local economy. See for instance https://en.wikipedia.org/wiki/GiveDirectly

I think that’s akin to (pardon my analogy) feeding wild animals: Do it long enough and they become more dependent on you.

I think money is better spent on education and infrastructure, so that value can be created by them eventually, not passed to them indefinitely.

Another way to put it: What if your parents raised you exclusively by feeding you and giving you shelter? What happens when they die if you can’t feed yourself?

"I think money is better spent on education and infrastructure, [..]"

The problem that we are discussing here is, precisely, how to give education and infrastructure efficiently to people that live in some of the poorest places of earth.

As an example: Givedirectly[1] have a program that give direct transfer cash to the poorest people in Kenya, Uganda and Rwanda. They make research about how effective this is and you get some reports back about what people do with the money.

Do you know in what they spend the money? education and infrastructure.

The common themes are: paying the school bills so their children can keep going to school, a cow or seeds so they can start a small business, and (the one I never could predict from my urban European perspective) a metallic roof so water don't come into their house when it rains.

Even if some people could misuse the chance, and that's unavoidable, humans being so diverse, the important thing is the efficiency of the program in its totality.

This theory that poor people just would stay at home drinking the money can be tested. In most cases, the theory has been falsified.

[1] - https://www.givedirectly.org/research-on-cash-transfers/

Roofs aren’t infrastructure. Giving money to private schools just helps them raise the price.

We should sponsor public K12 education so that parents never have to “afford” sending kids to school and can work instead of having to care for their children. Then they can spend that money on fixing roofs and buying food.

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