For years, policymakers have debated different approaches to helping the poor — everything from building schools, to delivering soccer balls that produce electricity. But new data, published in May after a nine-year, six-country study, offers evidence for a strategy that works.
A group of my economist colleagues and I, together with Innovations for Poverty Action and MIT's J-PAL, tested an approach known as a "graduation" program. The program is designed to boost the livelihoods of the "ultra-poor" — the 1 billion people worldwide who live on less than $1.25 per day.
We tested these programs using a randomized controlled trial, which is the gold standard for impact evaluation. Workers offer a new policy or program to a group, and over the same period track it and a comparison group that continues on as normal. This comparison is key because changes in the environment — such as weather or disease — can create massive swings in fortune for the poor. By comparing two groups that both experience the environmental changes, but only one of which receives the program, we can learn how much change is from the program.