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On Nick Kristof, Helping the World’s Poor, and Big Aid

In a masterful essay this past Sunday on how we can help the world’s poor (that was the title), Nicholas Kristof managed to honor Jeff Sachs (“indefatigable”) and Bill Easterly (“powerful and provocative book”).

But he probably has set off another round of the “ferocious intellectual debate” between those two and their adherents. That’s because he didn’t really get to the question the ferocious debate is actually about.

The Myth of Microfinance? Why MFIs Shouldn’t Be Freaking Out (Yet)

This is a joint post with Michael Clemens.

The headline in the Boston Globe on September 20, 2009 was catchy: "Billions of dollars and a Nobel Prize later, it looks like 'microlending' doesn’t actually do much to fight poverty." The article referred to the findings of two recent impact evaluations in microfinance in India and the Philippines conducted by researchers at MIT and Yale, respectively. The studies, which were randomized controlled trials (RCTs) of microfinance interventions, found “weak and in some cases nonexistent effects” of microfinance on profits, expenditures and well-being. Privately and publicly, donors, MFIs and practitioners are expressing concern about the impact of these studies on the future of microfinance. Are they right to be worried?