The effectiveness of development aid benefits from field experiments. Before a development programme is implemented on a large scale, whether or not it will work should be tested on a small scale using what is known as a randomized intervention. Such interventions, where there is often close collaboration between academics and NGOs (non-governmental organizations), provide a much clearer picture of what works and what does not, according to economist Prof. Robert Lensink of the University of Groningen.
Lensink’s thinking is in keeping with the views of renowned economist Esther Duflo, of Boston’s MIT. Her ideas are now beginning to catch on in Europe as well. According to Lensink, development aid needs to be tailored to the situation, which requires insight into the effect certain programmes have on a region.
For decades, development aid has no longer simply entailed sending huge sums of money to this or that poor region. Its aims and desired effects are definitely being thought about nowadays. ‘However, most evaluations of development aid are not valid because it is never taken into account that people who are eligible for development aid cannot be compared to those who are not eligible for it’, Lensink says. ‘A proper evaluation requires the treatment group to be comparable to the control group.’
Analogous to drugs testing, randomized experiments furnish a proper methodology to conduct a valid evaluation, according to Lensink. ‘In addition, we can also use small-scale randomized field experiments to gain knowledge that is extremely relevant to policymakers. Such experiments have for instance been used to prove that participation in health projects in developing countries drops sharply when participants are asked to pay for them.’
Lensink: ‘Participation in a deworming programme dropped from 75% to 19% in Kenyan schools when a minimal fee was involved. This research proved that a free programme works much better. Although you would like participants to pay a symbolic fee, it proves ineffective.’ Lensink himself has been involved in numerous evaluations of randomized experiments. He is, for example, evaluating the effectiveness of a course in North Vietnam aimed at having women start their own businesses. As part of the experiment he is investigating whether it is more effective to have women participate with their husbands or without them.
The approach is the brainchild of economist Esther Duflo, originally from France. She developed a system that can be used to conduct small experiments related to development aid anywhere in the world. It revolves around choosing communities or groups at random for a certain intervention. The effect of the programme can then simply be measured by comparison with a control group.
The knowledge that this experimental approach yields is not universally applicable. Lensink: ‘Something that works in Central Africa could be counterproductive in East Asia. This indicates the importance of replicating randomized experiments is different countries. Because it often involves small-scale field work, it isn’t at all difficult to conduct many of these repeat studies.’
Lensink advocates evaluations of Dutch development aid projects being done as much as possible using randomized experiments. ‘I can already see that policymakers are considering good control groups more important when evaluating a programme. The next step would be to conduct a randomized experiment in full.’
Robert Lensink (1962) studied Economics in Groningen and gained his PhD there in 1993 with a thesis entitled External finance & development , which charted the financial streams to developing countries. In 2002 he was appointed professor of Finance and Financial Markets at the Faculty of Economics and Business at the University of Groningen. He is also professor of Finance and Developmentat Wageningen University. His chief concern these days is the effect of microfinance in developing countries.
Article by Barend Abeln and Jan Jacobs on the website of the ESB (Economic Statistical Reports)
Enterprises in the Northern Netherlands innovated plentifully in 2018 This has been revealed by the Northern Netherlands Innovation Monitor, an initiative of the Centre of Expertise Vinci of the University of Groningen (UG) in collaboration with the...
Many major Dutch companies publish extensive information about climate impact in their annual reports. However, very few companies provide concrete, detailed information about their own CO2 emissions, the impact of climate change on their business...