Helping the bottom billion

by on October 25, 2007 at 7:42 am in Economics, Medicine | Permalink

Kevin, a soon-to-be loyal MR reader, asks:

What single intervention would do the
most to improve the health of people living on less than $1 a
day?

Experts answer here.  The first guy asked says give them cash.  One woman, whom I believe is a practitioner of living on a dollar a day, responds: "Improve the house, which is small and untidy." 

What I found noteworthy is how many plausible but quite distinct answers there were.  While I disagree with Jeff Sachs on many issues, I think he is right to stress just how many different problems have to be overcome for sustainable development to occur.

Your thoughts?

sa October 25, 2007 at 7:53 am

Free and important medicines for a limited period and upto a certain age for children. Also, free vaccines. I will avoid complicated bone marrow type treatments for free. On a aggregate basis , they turn out to have a poor cost-benefit ratio.

Will October 25, 2007 at 8:51 am

One would think the easiest answer would be to give them another dollar a day, and let them figure it out individually since top-down one-size-fits-all solutions may not be as efficient. But I don’t know if this would backfire due to the Friedman-Savage utility function (http://en.wikipedia.org/wiki/Friedman-Savage_utility_function).

W McGreevey October 25, 2007 at 9:23 am

Bjorn Lomborg of Copenhagen Consensus asked 8 economists to say how best to use an additional US$50 billion in donor assistance. Investing in health via prevention of infectious and communicable diseases ranked highest, with special emphasis on HIV/AIDS. Later, other development specialists and international policymakers agreed. Global Fund, PEPFAR, DFID, and Nordic donors are putting their money in some degree in accordance with thos recommendations. Cutler of Harvard, Deaton of Princeton, and Nordhaus of Yale have written of the positive benefit-cost ratios of investing in better health in the USA and rest of the world. Good investmnet opportunities in global public health goods.

Floccina October 25, 2007 at 9:37 am

I support a University of Florida medical mission to a rural area of the Dominican Republic. They like to bring vitamins, vaccinations. So I hope that these help.

I also think that providing DDT might help.

Would bleach to put in water help?

gc October 25, 2007 at 10:17 am

One woman, whom I believe is a practitioner of living on a dollar a day.

“Whom” should be “who”.

C October 25, 2007 at 10:36 am

The editorial board at 60 Minutes might say, Plumpynut: http://www.cbsnews.com/stories/2007/10/19/60minutes/main3386661.shtml.

tom October 25, 2007 at 10:54 am

Access to easy and cheap capital. People can often live (relatively) comfortably on a dollar a day on a day to day basis. Economic shocks or a requirement for capital to build a house, for example, can upset this equilibrium, leaving people exposed to money lenders etc. etc.

JoshK October 25, 2007 at 11:23 am

Colonize them.

Chris Durnell October 25, 2007 at 11:59 am

I notice two things. One is that many of the responders don’t actually answer the question. Instead, they answer a similarly themed, but very different question. The other is that many of these suggestions don’t actually lead to an immediate benefit to the poor. Instead, they immediately benefit some bureaucracy with the implication this will somehow benefit the poor. These two are not unrelated.

And that explains why so much foreign aid does not actually help.

Michael October 25, 2007 at 12:17 pm

A better battery. This would permit cheap micro-power installations. Lack of infrastructure keeps them separated from the world economy. No power, no telecoms, no internet, no investment. It makes everything more expensive for the local populations. With a better battery (something you could fill and empty with current as easily as putting gas in a tank), all sorts of otherwise silly Green power systems actually become practical.

Stan October 25, 2007 at 12:55 pm

Allow them to immigrate to the “Western” world. It may or may not improve our standards of living or our health, but when they no longer make only $1 a day, they can start spending more on healthcare or whatever else they value.

nu October 25, 2007 at 2:13 pm

Litteracy.

literate people usually have less children.
literate people can read about contraceptives.
literate people read newspapers and form better opinions.
literate people don’t have to be told about agricultural techniques, they can go an search for them by themselves.
literate people know how to use google.
literate people know how to read a manual that explains how to keep water clean, and manuals are cheaper than experts doing the explainning.
literate people can kick your ass.

(bicycles shouldn’t be given, as locals do know how to build them)
(freedom is hard to give. i mean how do you do it ?)
(colonization is like communism, if it didnt work once, why do you expect it to work again ?)
(vaccines could be useful but people need to want them, otherwise you’re waisting your time)

Floccina October 25, 2007 at 2:57 pm

If more technology that allows people to circumvent their Governments came along it might help.

8 October 25, 2007 at 3:08 pm

colonization is like communism, if it didnt work once, why do you expect it to work again ?)

It did work for the British.

I was sort half joking by calling for colonization, but think about answers like giving them freedom, increased immigration and open borders, which 3 people gave. What is easier, moving tens of millions of immigrants to here or moving ten thousand elites to X? 2 people want to give them law, I’d say something approaching colonization (whatever you want to call it if the British Common Law system is transplanted almost wholesale into a country) is the fastest way to do that.

nick October 25, 2007 at 3:20 pm

Seed capital for microcredit programmes.

Anonymous October 25, 2007 at 3:43 pm

This is a flagrant plug for Kiva.org

nu October 25, 2007 at 4:40 pm

I was sort half joking by calling for colonization, but think about answers like giving them freedom, increased immigration and open borders, which 3 people gave. What is easier, moving tens of millions of immigrants to here or moving ten thousand elites to X?

but see, it didnt work before exactly because of that.
you don’t “give” freedom by taking away freedom.
trade, exchange, population movements are ways for people to be exposed to ideas and adopt, adapt or reject them if they like it or see the benefits.
and let’s not forget that ocne you move those elites, they will soon find every reason to go against their alledged principles in order to defend those principles (think indirect rule, expropriation as the democratic centralism of british colonialism)

it’s quite scary that so many people think clean water is easily doable. the issues are not really different than with food aid. the World Bank has been spending money to build such infrastructure for a while. And the results have been at best “nice facilities with no mantainace budget that end up being outgrown by the population they attract”, at worse, well, i know a few people who drink lots of mineral water and champagne thanks to those loans/donations/projects.

litteracy is still the idea that maximazes results for the lowest input.

Ken October 25, 2007 at 8:55 pm

Why do anything? Maybe the best thing to do is leave people alone and let them figure out how to better their own lives. Maybe what we are doing is making their lives worse (and only making us feel better because we’re showing that we care). Why do we think we know what’s best for them or fix their problems or even properly identify the problems to be fixed? Maybe we should just stop meddling in other people’s lives… completely. Meaning eliminate all aid, government to government transfers, and remove all barriers to trade.

Nancy Lebovitz October 26, 2007 at 6:30 am

Telling people that they need to boil water won’t help if they can’t afford fuel. Yes, some people really are that poor.

Roland Johnson October 26, 2007 at 9:32 am

A follow up comment:
Gary and LemmusLemmus have it wrong. The subsidies on agriculture may or may not remain. What needs to go away is the subsidy on food in the cities. This drags people away from farms where they produce the food and into cities where they only consume.

The Plug for WHO is absolutely wrong. The UN is simply a bureaucracy needing to be fed. Yes Health care is needed but Food and Clean water come first.

Paul Holden October 26, 2007 at 11:39 am

The comments from the so-called “experts” show why there are still so many poor people in bad health. They are full of “should do’s” that do not address the realities. In addition, there appears to be no sense of time preference. To say that the health of the poor might be better addressed by improving education or “empowering women” might be correct, but begs the questions regarding how soon this could have an impact and how it is to be achieved. Every international aid program contains these two objectives yet are strikingly ineffective.

One major problem that transcends the amount of money applied to dealing with these problems relates to how to deliver the services. I have an example from on the of the Pacific Island countries in which I have worked. There are many outlying islands, remote from the capital, where schools do not receive any books. Yet one of the Aid Agencies has donated thousands of school books, which are sitting in a warehouse in the capital, literally rotting [the climate is very humid]. The books have not been delivered because the government run shipping services travel irregularly and are too inefficient to get their act together to deliver the books.

Yet every village in the outer islands has a small store, that is periodically stocked by small private boats that make the rounds of the islands. However, the Aid Agency says that its policy is not to use private carriers for the delivery of educational services, which presumably includes books.

So the problem is not only a lack of resources, but also a lack of effective delivery mechanisms, the efficiency of which is exacerbated by ridiculous policies of those who are supposed to be concerned about the poor.

The only way to improve the health of the very poor is to experiment with delivery systems, including private ones – competition is a wonderful thing. The first response by the incumbents in the health and education ministries of the countries in which the poor reside will be to try and prevent any private participation. If the donors resist this, models of effective delivery will emerge from the experiments. The current problem is that those attempting to improve the lot of the poor confuse the funding of programs – which probably requires public money – with the delivery, with the result that efforts founder in the hopelessly inefficient ministries that characterize poor countries.

Ken October 26, 2007 at 1:10 pm

John Dewey,

“I don’t have any problem with donations for disaster relief. Or with individual volunteer efforts such as the doctors and nurses who use vacations to provide medical care in places where people are sufferring high disease rates. Or with missionaries who have given up years of their lives to teach children to read and write.”

The ‘problem’ I have with these people is:
1. People who donate for disaster relief usually don’t care how much their money helps in a disaster, they just want to feel like they care. In other words, these people aren’t trying to help disaster victims, they want to feel like good people. Because of this almost everyone who donates money doesn’t follow up to find out how the money is spent, so remain ignorant of the waste of their money. Much money for donations goes to raising more money, paying for the charities infrastructure and so on, while only a little gets to the intended recipient.

2. “[I]ndividual volunteer efforts” such as the doctors and missionaries you mentioned is that there are a billion people in the world below the $1/day poverty threshold. How many individual volunteers are there? They cannot hope but to help just a few tens of thousands, maybe even a couple of hundred thousand (this is a made up number, but I would be shocked to find the number higher than 1M).

I do think that in 1. it might be better for people to give just to make themselves feel better, rather than to do any actual good. It might be better because the money really might be put to good use. The question is whether that money would have been used more wisely if it wasn’t donated.

I do appreciate the individual volunteers of 2., but to think this might be any sort of solution to solving the problems for the bottom billion is delusional. Their efforts are not helpful to the 999,000,000 (again this is a made up number. see above) others not receiving their help.

Regards,
Ken

Ed D. October 26, 2007 at 3:31 pm

Life Straws for everyone. Costs $3, lasts a year… can wear it on your belt. Clean water from a mud hole.

As much as I dislike ol’ Franklin Graham, his support of this program and these devices is right on target.

77,000 die every week from lack of clean water and sanitation. The middlin’ estimates to solve the problem are 10 billion a year for 10 years. How hard can it be. Yes, in some places politics and ethnic troubles will get in the way, but overall, much can be done. And this estimate was before the life straw existed.

R. Richard Schweitzer October 26, 2007 at 9:00 pm

Lower the costs of living to 12 cent a day.

That’s serious. Determine what makes up the $1.00 per day of costs, and find out what needs be done to reduce those costs.

Is it transport of millet? Access to water? whatever makes up the costs, and reduce them.

nyangau October 28, 2007 at 10:18 am

Do nothing!

The bottom billion are living on a dollar a day, because we tried to help the health of the bottom 100 million earlier this century and the law of unintended consequences produced population growth outpacing local economies, resulting in a very unhealthy bottom billion living on 1 dollar a day, instead of a relatively healthier bottom 300 million living on 20 dollars a day.

Developing countries, social, political and economic institutions have never coped with the population imbalances wrought by the immunization and health campaigns spread by do gooders bearing goodwill from the rich of the world.

The very fact that smart thoughtful people with access to econometric tools that give the ability to explore second and third differential outcomes are utterly unable to resist the temptation to interfere in complex systems, as evidenced by the question posed at the beginning of the thread, without even asking first whether a different outcome will ensue, just serves to show that our instinct to help operates at deeper levels in our psyche than our intellects ability to consider the outcome.

I suspect that given the massive complexity of the systems involved in determining the long term quality of life of the populations in developing countries, our children will be debating on this same blog, or whatever relevant communication medium has supplanted it, what to do about the bottom 10 billion living on $2 dollars a day that resulted from a successful answer to the question posed at the top.

The microscopic grasp of the total reality of human life on this planet that i have been able to garner tells me healthcare is not the solution, economics is, that’s why i read economics blogs, because in all my intellectual inquiry economics seems to hint at the answers to solving global poverty. Open systems of all types everywhere. By the way I too wouldn’t exist if it wasn’t for WHO immunization interventions in Africa.

aizheng October 31, 2007 at 3:26 am
Stephen December 7, 2007 at 8:56 pm

There are hundreds of ways to improve the health and wellbeing of people living on less than one dollar a day. The truth of the matter is though what would happen to the economy if we do anything to the millions of people who live like this? Are we talking about in America or the world? The number of people is so vast just in America that whether we just give each person one more dollar than they have now, it could turn the country into having a resession or inflation.

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