GiveDirectly — Large-Scale Basic Income in Rural Kenya
GiveDirectly / Princeton / MIT / UC Berkeley · Siaya County, Kenya · 2016
Summary
The GiveDirectly Kenya experiment is the most rigorous test of basic income ever conducted in a low-income setting, and its findings upend two central assumptions of development economics. First, recipients do not reduce work when given unconditional cash — they work similar hours and invest in more productive assets and activities. Second, the benefits are not contained to the recipient household: the local multiplier effect means that control-village households within the treated area also became richer, as money circulated through local markets. The experiment reveals that unconditional cash transfers can function like a capital injection that grows the local economy, not merely a redistribution of existing resources. The 12-year time horizon will eventually answer the question no shorter experiment can: do the effects persist, or do they fade as the transfer becomes a long-run baseline?
Research question
"Does a long-run unconditional basic income — large enough to lift recipients above extreme poverty — improve consumption, assets, and psychological wellbeing in a low-income rural setting?"
Methodology
Intervention
The largest basic income RCT ever conducted. GiveDirectly randomly assigned 295 villages to treatment or control. Within treatment villages, all households received one of three variants: long-term (monthly $22.50/month for 12 years), short-term (lump sum equivalent of 2 years of long-term), or short-term monthly. Comparison villages received nothing. The $22.50 monthly transfer represented approximately 75% of baseline household consumption.
Assignment
Village-level randomized controlled trial; 295 villages randomized; outcomes measured via household surveys and satellite imagery; 2016–ongoing (12-year program with published results from first 2 years)
Sample size
~21,000 recipients across treatment villages; ~9,000 in control villages
Primary outcome
Consumption expenditure; assets (livestock, home quality); psychological wellbeing; food security; hours worked; local economic activity (general equilibrium effects)
Effect estimate
Consumption: +30% vs. baseline; assets: +40% in asset values; food security: significantly improved; psychological wellbeing: large positive effects on stress and happiness; hours worked: no reduction; local economic spillovers: significant — control villages within treated areas also showed consumption increases (~$2.50 for every $1 transferred, via multiplier effects)
Decision
GiveDirectly has become the largest basic income funder in history; results used by GiveWell to inform cost-effectiveness rankings; local economic multiplier finding influenced debate about macroeconomic effects of cash programs; US and European basic income proponents cite GiveDirectly as benchmark evidence; ongoing 12-year data collection will provide the first evidence on truly long-run effects
Result
Positive
Consumption: +30% vs. baseline; assets: +40% in asset values; food security: significantly improved; psychological wellbeing: large positive effects on stress and happiness; hours worked: no reduction; local economic spillovers: significant — control villages within treated areas also showed consumption increases (~$2.50 for every $1 transferred, via multiplier effects)
Evidence strength
Strong
Randomized controlled trial with large sample.
Replication status
Open for replication
Institution
GiveDirectly / Princeton / MIT / UC Berkeley
Location
Siaya County, Kenya
Year
2016
Policy area
Basic Income
Mechanism
Cash transfer