GiveDirectly

GiveDirectly is a charity organization giving money directly to the extreme poor in Kenya using a mobile payment system.

GiveWell's report on GiveDirectly's work indicates that 90% of donated money finally reaches the recipients. Cash transfers are amongst the best-studied development interventions, though questions still remain. Studies generally show substantial increases in short-term consumption, especially food, and little evidence of negative impacts (e.g. increases in alcohol or tobacco consumption). There is also some evidence that recipients are able to invest cash transfers at high rates of return (e.g. ~20% per year), leading to long-term increases in consumption. Compared to traditional development aid, usually coordinated by governments and non-profit organizations, results are promising.

From project management point of view it is necessary to evaluate project's impact on recipients' lives. We could choose a relatively simple and widely used index, such as United Nations Human Development Index (HDI), for this purpose. It is a composite index consisting of indicators of life expectancy, educational attainment and income. Although there is not yet information on impacts such as nutritional or educational status related to GiveDirectly's charity project, it would be reasonable to expect that life expectancy of the recipients would increase when they have more money to spend on food. Together with the increase in wealth it would lead to a higher human development index for them. The most recent HDI measured for Kenya in United Nations Human Development Report 2013 was 0,519 ranking the country in the low human development category.

But is this project sustainable? In order to answer that question we should also consider the environmental effects. A widely used composite indicator for measuring environmental impact is so called ecological footprint by the Global Footprint Network. It measures in global hectares how much land and water area a human population uses to provide all it takes from nature. The figure is then compared to the biologically productive area, so called biocapacity. The most recent study revealed that the average biocapacity for the whole planet Earth is 1,8 global hectares per person. For Kenya the ecological footprint is currently around 1 global hectare per person.

For the specific project in question we would need to develop ways to evaluate in what ways and how much the increased wealth changes recipients' burden on the environment, e.g. measured through the ecological footprint. Only then a reasonable judgment on the sustainability of the project can be made.