It Is Ok To Pay Poor People In Order To Encourage Them To Seek/Accept Help

Incentivizing people to do the right thing is a controversial issue debated intensely by academics. Some scholars believe that people shouldn’t be ‘aided’ or paid to do the right thing (or what will be to their benefit) such as immunizing their children, saving for retirement, seeking medical help at a certified clinic, and so on, else they will develop bad habits. Other schools of thought believe that poor people sometimes need to be nudged in the right direction before they get used to doing the right thing.

However, let me ask you a question, “Would you save half of your income/salary, monthly (managing somehow on the rest), if you knew you were going to be given triple the amount saved, at the end of the year?”

Richard Thaler calls it 'nudging', some others, 'incentivizing'. I believe we should do all we can to help people live more qualitative lifestyles and have a healthier, richer world. It is simple or easy because you know the answer...but to those who don't know a thing, it is neither easy nor simple.

It is easier for you to call others lazy because you have a job, or call others dull because you easily passed the exams they failed. But there is nothing we have that we were not given. If we have been blessed, let us extend that blessed fellowship to others by nudging them, even to the extent of paying them if need be, to accept what is good for them and their society/communities.

Examples of some 21^st century ‘Nudges’ (or, creative marketing/growth hacking strategies):

Paypal paid the first subscribers $10 to join their payment platform: Now, everyone knows Paypal. Today, the company does a lot of good, adds value and can save you a lot of stress if you are an online merchant, but at the beginning it didn’t seem so. In fact Paypal paid the first users $10 to join and another $10 to bring others. 

Paying people to receive immunization/giving them for free: The rich all over the world pay a hefty sum to immunize their kids. In Northern Nigeria, people are given immunization for free today. In some Indian cities in the past, families were paid to visit immunization clinics, for each visit. However, any attempt to downplay the importance of this will result in diseases such as polio continuing unchecked, and the world will be taken back to the dark ages of health.

Save More Tomorrow: I have talked about this here before. Richard Thaler and Shlomo Benartzi came up with this program to help employees save more of their income effortlessly, in the future. There is a book on it now.

And many others....


By the side,

The 2015 Nobel Prize goes to an Economist who researches on and preaches poverty alleviation

Professor Angus S. Deaton got the 2015 Nobel Prize in Economic Sciences due to his extensive work charting global developments in health, wellbeing and inequality. He is well published on consumption, poverty and welfare, and he believes that economic growth is very important for health and happiness, and that it is absolutely essential to solving poverty. 

Truth is, from my little research on poverty eradication coupled with the fact that I see poverty first hand every day, poverty eradication is first and foremost the job of the government of the country, before NGOs, Economists, philanthropists and other well-meaning citizens of the world (should) come in to do their bit.

I look forward to a world without hunger, and war and poverty. But until then, let us all individually continue to do our bit to help make the world poverty-free.

Cheers!