OFFENSE, NOT DEFENSE:

Much more research exists on giving cash to the poor in developing countries. Jeremy Shapiro examines the effects of giving money to people in need through his work as a co-founder of GiveDirectly and as a researcher with the Busara Center for Behavioral Economics. At GiveDirectly--a nonprofit that, as its name suggests, offers cash with no strings attached--he worked on a study in Kenya; between 2011 and 2013, the researchers determined, the program improved people's food security, allowed them to buy other crucial goods (from soap to school supplies), and was beneficial to their psychological well being. Counter to my childhood lesson, recipients didn't spend any more than they had in the past on so-called temptation goods like alcohol and tobacco. "The takeaway is surprisingly unsurprising--when you give money to poor people good things happen," Shapiro said. "People eat more, they invest in businesses; you see people reporting being happier and less stressed out."

David Evans, an economist with the World Bank, and Anna Popova, a researcher at Stanford University, dug into a number of studies on direct giving programs to examine whether spending on cigarettes or booze spiked. These included research in Burkina Faso, one of the world's poorest nations in terms of GDP, and Brazil, which is relatively wealthy. Overwhelmingly, they found that giving cash "had no impact on spending on alcohol and tobacco," Evans said. "In a number of cases, it even seemed to have a negative impact--people spent a lower proportion of their budget on these temptation goods." Instead, people spent the money they received on food, education, their homes, and small business investments.

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