Cash transfers can outperform more complex economic aid programmes | VoxDev
GiveDirectly
Benchmarking in-kind programs against cost-equivalent unconditional cash transfers shows cash can do more to improve consumption + asset accumulation
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On February 26, 2025, the US government cancelled 90% of all USAID contracts, amounting to more than USD$60 billion in US foreign assistance. These cuts appear to reflect a view that USAID’s foreign assistance is not aligned with US taxpayer interests, inefficient, or both. One measure of the concern for inefficiency is the worry that a large share of funds is consumed by overheads. The concern for the share of foreign assistance that reaches its intended beneficiaries is a longstanding one, for charitable foundations (Gneezy et al. 2014) as well as the government. These concerns have animated an interest in providing assistance in the form of cash grants, as these can be delivered with minimal overheads relative to other, more complex forms of assistance.
