‘More Than Good Intentions’: a reviewPosted: April 27, 2011
Two new books are just out from some of the key figures of “the new development economics” (Tyler Cowen’s label, not mine) – More Than Good Intentions: How a New Economics Is Helping to Solve Global Poverty by Dean Karlan and Jacob Appel, and Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty by Esther Duflo and Abhijit Banerjee. I’m not a development economist, but I’m keen to discuss what this movement can contribute to the aid and development debates in general, and the field of water, sanitation and hygiene in particular.
First onto my Kindle: More Than Good Intentions. Karlan and Appel use insights from behavioural economics to show how poor people can be given a helping hand (or a ‘nudge’, following Thaler and Sunstein) in many aspects of their lives, especially microfinance, and to demonstrate how the impact of these interventions can be rigorously evaluated using randomised controlled trials (RCTs). The book is a showcase – or perhaps manifesto – for the work of Innovations for Poverty Action (IPA), the organisation founded by Karlan to put into practice and test out these ideas, in collaboration with a range of partners around the world. Some good examples, all starting from programmes in Kenya, include encouraging farmers to buy fertiliser ready for the next year’s harvest by offering them pre-paid vouchers just after they sell their current crop; working out what interventions are most cost-effective for improving school attendance (deworming is cheaper than giving free school uniforms to the poorest); and – obviously of great interest to me – increasing the number of families using chlorine to treat drinking water by placing simple chlorine dispensers next to water points.
The positives: More Than Good Intentions is a very readable introduction to the field of behavioural economics and RCTs in development, and the authors do a great job of conveying the excitement and potential of development research in general. The format of describing results from investigations by a variety of Karlan’s IPA collaborators interspersed with anecdotes from people Appel meets in his research works well (although the language has some overly cutesy lapses, such as “a great waterfall of pork rinds frozen in mid-cascade” in a small shop in the Philippines). Karlan is particularly strong on interrogating the details of the microfinance movement, and examining the existing ways in which the poor manage their finances (a strength shared with Portfolios of the Poor). I also liked the comparisons with ‘nudge’ ideas which originated to help Western consumers save better or keep their commitments, such as Save More Tomorrow and Stickk.com.
Where I found the book unsatisfying was in its lack of discussion about how to “bridge the gap”, as Karlan and Appel put it, between particular RCTs and wider applicable recommendations. As in any development intervention, context (see an excellent series of posts by Dave Algoso on Find What Works) is crucial; the claim of More Than Good Intentions is that enough RCTs plus an understanding of the underlying behavioural theory can show us what ideas can be successful across different contexts. The concluding chapter lists “seven ideas that work”; some of these are considered to have ‘proven impact’ by IPA’s Proven Impact Initiative while others are at the ‘promising’ stage. But I would have liked more detailed discussion from the authors on how we can draw these wider conclusions and what evidence base they think is needed.
More Than Good Intentions also shows some tantalising glimpses of the politics involved in implementing policy based on evidence from RCTs, but neglects the juicy details and what we could learn from these. For example, Karlan and Appel state that the Progresa programme in Mexico, which provided small cash grants to the poor dependent on their school attendance and health clinic visits, was originally controversial but later accepted, partly thanks to the results shown when it was subjected to an RCT. I would have liked to have seen this example used as the basis for more discussion in the book on the process of using RCT evidence to promote policy change.
So where do we go from here? Happily, More Than Good Intentions finishes with a good list of references, so I’m going to look in more detail at the work so far on chlorine dispensers and explore in a later blog post the wider possible relevance of both ‘nudges’ and RCTs for the water, sanitation and hygiene sector.