Poverty Reduction: Getting the Most Bang for Your Buck

Bruce Wydick is professor of economics at the University of San Francisco and visiting professor at the University of California-Berkeley.  He wrote an article for Christianity Today on “Cost Effective Compassion:  The 10 Most Popular Strategies for Helping the Poor,”  noting:

Today, those who want to care for the poor enjoy a plethora of attractive options. But what are the best ways to help those living in developing countries?

I polled top development economists who specialize in analyzing development programs. I asked them to rate, from 0 to 10, some of the most common poverty interventions to which ordinary people donate their money, in terms of impact and cost-effectiveness per donated dollar.

Sixteen researchers responded to the survey. They are from Cornell, Duke, Yale, the University of Maryland, UC-Berkeley, Stanford, George Washington, UC-Santa Cruz, the University of Minnesota, Brandeis, Michigan State, Tufts, and the World Bank.

So of the top ten most popular, here is how they ranked their effectiveness.  The list starts with the greatest “bang for your buck” projects.

To be clear:  this is not a “top ten” list.  It’s a ranking of the effectiveness, from the economists’ perspective, of ten very popular programs.

  1. Getting clean water to rural villages. (8.3)
  2. Fund de-worming for children. (7.8)
  3. Provide mosquito nets. (7.3)
  4. Child sponsorship. (6.9)
  5. Give wood burning stoves. (6.0)
  6. Microfinance loans. (4.2)
  7. Fund reparative surgeries. (3.9)
  8. Donate a farm animal. (3.8)
  9. Drink Fair Trade coffee. (1.9)
  10. Give a kid a laptop. (1.8)

Anything surprise you?

I’m thrown off a bit on the coffee ranking.  I’ve always heard the coffee industry is so difficult for growers and that Fair Trade is a must.

Our students just returned from Antigua, Guatemala, and tried to share with me a bit of info they learned from a local coffee project there.  But they were very tired, and very excited about other things they learned.  So it boiled down to “there’s no such thing as truly fair trade and the only way to solve it is to partner with that project.”

So we missed some details.

Basically, I’ve got all kinds of questions and not many answers.

And I just love my coffee.  I gotta know.

(So, Michelle, if you’d like to guest post on coffee for me, consider this an invitation.  I’d love to hear more!)

I am encouraged, though, because my church is all about clean water.  I’ve written before about our half-marathon in January, which ended up raising over $95,000 for water projects with Team World Vision.  And three of our runners kept training for the Los Angeles Marathon, which happened this past Sunday, and raised an additional $5,000.  Not too shabby for our first year.

Thoughts on the list?

Read the full article here.  Photo by Jeff Kubina.

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