Does giving free money work?

One of my students in my Nonprofit Management class pointed out  ‘Give a man a Fish’ by James Ferguson on the (controversial) idea of a universal basic income (UBI). This has been an ongoing debate in the world of development studies. The premise is simple : Give the poor enough money so they don’t have to worry about the basic necessities. This stems from the understanding that the poor need help and with enough food, money for living etc. they will focus on the higher needs of life – following Maslow’s hierarchy.

When I suggested this idea, the class was more or less bought in, except for one (or perhaps two) who thought that this would make people ‘lazy,’ and dependent. While in principle, this may seem possible; studies conducted in Kenya show promise in terms of how giving directly seems to be working. The speakers in the podcast point out that most people know how to spend money to become self-reliant. The field research project being conducted shows that money, given on a regular basis, to a while community ultimately helps them.

They also point out that US Founding fathers thought of this idea, so was the idea around during the French Revolution. With growing industrialization, fewer jobs; there seems to be a realization that such an income is the only way to take care people who don’t have jobs.

Of course, this has opposition from those who don’t believe in distribution of income, for no efforts from people.

From my own experience, of witnessing my (late) mother – a school teacher – help many of her students and nephews and nieces, who were poor; I think this idea works. My mother gave ‘directly’ to many families, for over 25-30 years, often sums of money that helped the families educate their kids, feed them and in many cases, helped them send them to school. The long-term effect of this strategy? I know at least three families that are doing significantly doing better, with the children having been educated at universities, many of them working in stable jobs and the entire family being lifted out of poverty.

Do I believe in UBI? I have reasons to, as I have seen the effects of such a measure. Will this become a policy in the West? That, I am not sure of. However, countries such as India, Kenya could be persuaded in this direction.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s