Stop Paying The Poor So Much

Recently I was asked to serve on a panel after a screening of the documentary Poverty Inc. In the course of the discussion I brought on the story about the Haitian woman who was employed by a nonprofit run by Americans and was able to save $2,000 over the course of 6 months to buy […]

How Microfinance Is Used – First World Application

Costco is glorious. I remember as a kid sitting in the cart and getting piled in massive boxes as my mom stocked up for the pleasure of having us kids running around all summer free from the prison that is school. Otter pops and bagel bites for days. Costco is often dubbed the “$200 dollar store” because […]

People are Fundamentally Good. Evidence – Cash Transfers

In development is it all to often that you find individuals who throw up their hands and think that all of their efforts and everyone else’s efforts are helpless. In my own experience this is almost always the result of a lack of understanding amongst individuals. Cultural differences are often the root issue but aid workers […]

Don’t Teach A Man To Fish. Start A Fishing Company

Let’s cut to the chase. The phrase “Give a man a fish he eats for a day. Teach a man to fish he eats for a lifetime” is simple and seems like a revelation but is incredibly problematic. First off, it assumes the poor don’t know how to fish. In other words, the poor have […]

US in 1800 = Uganda Today

British Economist Angus Maddison put together in 2007 the first comprehensive analysis of global incomes dating as far back as is possible, known as the Maddison Project). For the US and most of Western Europe the data is sporadic before 1800 but has yearly data after 1800. For the rest of the world the data starts […]

Money Lending and Why People Borrow From the Mafia

By now most people are familiar with the outrageous interest rates money lenders charge the poor. In rural Pakistan the average interest rate was 78% even though the default rate was only 2%. In Chennai, India a working capital loan had an interest payment of 4.69% per day. To put that in perspective, a $5 […]

Microfinance in a Social Business

The greatest difficulty in opening banking services to the poor is the lack of information. The poor live on the margins of society and are absent from documented processes. The low volume of money they both earn and spend make it difficult for any type of financial history to be created for them.  Group lending […]