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Is Charity for the Poor Futile?

A group of leading economists recently criticized aid to the poor for failing to address poverty's root causes. But while we wait for politicians to act – and it could be a long wait – it is important to concentrate our spare resources on effective aid that helps poor people lead the best lives they can.

MELBOURNE – In an essay published last month in The Guardian, 15 leading economists – including the Nobel laureates Angus Deaton, James Heckman, and Joseph Stiglitz – criticized what they call “the ‘aid effectiveness’ craze” on the grounds that it leads us to ignore the root causes of global poverty.

I advocate assessing the effectiveness of aid and providing resources for interventions shown to be highly cost-effective. To that end, I founded The Life You Can Save, an organization that gathers evidence about which charities give donors the most bang for their buck and encourages people to donate to them. The Life You Can Save recommends proven interventions because we think donors are likely to do more good by helping individuals with unmet needs than by aspiring to eliminate the root causes of poverty without a realistic strategy for achieving that goal.

Deaton, Heckman, Stiglitz, and their colleagues begin by telling us that global poverty “remains intractable.” This statement reflects and reinforces the gloomy view that we are not making any progress in reducing poverty.