Second-Order Wins✓✓ 3 independent sources

Free Cash Doesn't Buy Booze — It Builds Local Economies

$1 cash → $2.40 of local income; temptation-goods fears unfounded

In the largest general-equilibrium test ever run, Egger et al. gave one-time transfers of ~$1,000 to over 10,500 poor households across 653 randomized Kenyan villages: recipients gained consumption and assets, non-recipients gained through spillovers, prices barely moved, and the local transfer multiplier was 2.4. And the fear that cash fuels 'temptation goods'? A World Bank review of 19 quantitative studies found almost without exception no significant impact — or a negative one — on alcohol and tobacco spending.

Every $1 in unconditional cash sent to poor Kenyan households generated $2.40 of local income — and a review of 19 studies finds cash does NOT increase alcohol or tobacco spending.

#poverty #cash-transfers #economics

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