A revolutionary social experiment will consist of giving people in 200 villages, free money starting from October.
The not-for-profit organization, Give Directly, will begin a pilot study on a form of wealth distribution known as “basic income.” First proposed in 1960, the program’s main goal is to reduce poverty by guaranteeing every person a minimum salary without a catch.
The test will divide 26,000 participants from the villages into three groups. The first group will receive a basic income of $0.75 a day for 12 years, the second group will get the same amount for two years and the third group will get two years’ worth of basic income in a lump sum. Data will also be collected from a control group of participants who are not forwarded any cash.
The objective of the research is to find out whether the knowledge that there will be a steady influx of money enables people to take more risks. They might look into setting up a business or making investments, something they may be afraid to do so if they are uncertain of a constant income. The experiment has been broken into three groups so that the organization can understand the differences in decision making.
“Comparing the first and second arms will shed light on how important the guarantee of future transfers is for outcomes today,” the charity stated in its blog post. “The comparison between the second and third arms will let us understand how breaking up a given amount of money affects its impact.”
There have been some minor complications regarding the project. According to the blog post published in early September, some parts of Kenya observed lower than expected participation rate. The researchers have largely attributed this to skepticism of the villagers about the nature of the charity.
However, Give Directly is continuing to improve its outreach and does not anticipate a critical problem with the experiment.
Since April, the organization has collected over $11 million. Even though, a project of this magnitude is a first in Kenya, smaller experiments have shown that providing free money does help rural areas to prosper.