An argument for foreign aid, even used by some Republicans, is that it makes a nation "stronger." This isn't about economic or military strength but moral strength—acting generously and living by the "golden rule" reflects the character of its people through its government.
Policymakers struggle to apply academic findings because research doesn't specify how to translate evidence into procurement documents. An intermediary is needed to bridge this gap, acting as an in-house consultant to map research to actionable implementation plans for those writing contracts.
For any development problem, a program should either be based on strong existing evidence ("use it") or, if such evidence is absent, be designed as an experiment to generate new findings ("produce it"). This simple mantra avoids redundant research and ensures all spending either helps or learns.
An ideal procurement process identifies the most cost-effective known solution but also allows bidders to propose an innovative alternative. This alternative must be accompanied by a rigorous impact evaluation, turning procurement into a mechanism for continuous improvement rather than a static decision.
After an intervention like cash transfers has been validated by over 100 randomized trials, spending more money on another study is unethical. That funding is being taken from potential beneficiaries to measure something already known, preventing more lives from being improved.
Contrary to Econ 101's labor-leisure tradeoff, unconditional cash transfers consistently lead to an increase in work in low-income countries. Recipients are capital-constrained, and the cash enables them to start small businesses, leading to a zero or positive effect on labor supply.
While cash transfers are effective, the "Graduation Model" provides a more comprehensive intervention. It bundles a cash or asset transfer with training, life coaching, and savings access to build stable, long-term income sources for the ultra-poor, showing more consistent long-run effects across dozens of RCTs.
Public opposition to foreign aid is based on a massive misconception. Polls show Americans think 25% of the U.S. budget is spent on foreign aid and want it cut to 10%. The actual figure is only 0.6%, meaning their desired "cut" is still a massive increase.
Most donors choose a cause with their heart. Attempting to persuade them to switch to a more "cost-effective" cause is almost always futile and can feel judgmental. A more productive approach is to accept their passion and help them choose the most effective organization working on that specific issue.
An aid agency's budget is dwarfed by a host country's ministry spending. Therefore, instead of running parallel programs, the most impactful approach is "system strengthening": working directly with local government to integrate evidence and optimize how they allocate their own, much larger, budgets.
Don't dismiss high-leverage but hard-to-measure interventions like government capacity building. Use "cost-effectiveness thinking": create back-of-the-envelope calculations and estimate success probabilities. This imposes quantitative discipline on qualitative decisions, avoiding the streetlight effect of only focusing on what's easily measured.