If you had a poor but promising nephew, you might promise to pay his way through college. You would place some limits on his activities – you probably wouldn’t pay for a semester off to train for Halo championships. And you might insist he maintain a minimum GPA. But you probably wouldn’t interfere much in his choice of college or major. And when you give to your children in your will, you rarely place restrictions on how they can spend what you give them.
This is a good point:
is there a relationship between
* the amount of money that parents put into their children's education, and their average level of interference?
* the amount of money *the parents have*, and the amount they put into their children's education relative to that, and their average level of interference?
* Whether the parents that 'help' are Old Money vs. New Money. Old Money may, for example, have a long-established tradition of a certain kind of education -- whereas New Money may be more open to new ideas...or something completely different.
I know someone who got a year of tuition paid for(by a lower-middle class familiy), but who had to change his major, and another friend who had a solid 1%er family with no end of strings attached. Granted: it's anecdotal evidence, so no one should believe it per se, but it seems like there's going to be some factors like these at play.
John, I'm talking about real people today.
The entail critique is more legitimate than you think in that the US at least doesn't recognize entailments beyond one generation (and I think the same is true of GB today).
We don't really know how many real people today would put such things in their wills if they were enforceable. But many real people certainly *did* so back when it was.
I'd like to challenge the notion that we treat poor people in our nation with less interference than the Nepalese. Have you ever seen a welfare eligibility determination system? They are notoriously complex, requiring tons of programming effort to adjust every time Federal and State regulators adjust aid policies to the poor. No conditions that we impose on foreign aid approach the conditions we impose on our own poor.
I'm in favor of our current policy of imposing greater restrictions on the domestic poor, given the sums of money involved.
Our "Official Development Assistance" is the best figure for total non-military foreign aid. It was $19 billion in FY04: http://digital.library.unt....
In FY00 our total spending on social welfare was about $1 trillion. Excluding entitlement programs, about $430 billion of this was targeted to the poor: http://www.libraryindex.com...
If you drop cash on a bunch of Nepalese peasants, what do you think they are going to do with it? Truck on over to Walmart? Order from Amazon?
Are you suggesting something along these lines?
See Bruce Bueno de Mesquita on foreign aid.
Without sounding too heartless, could it be that the poor have proved themselves inept with money, while our promising nephew has not. And I would second Ping, paying for college isn’t exactly like handing over cash.
On an unrelated topic, is Cuba the ready for Futarchy? I would think it would be best to experiment with a government that was A) in transition and B) very bad to begin with.
My issue with shooting free money down the pipe is accountability. In underdeveloped regions, there is likely to be overt corruption, and I have a (reasonable, I think) suspicion that string-less money will find itself funding some despot's harem instead of improving access to medicine or potable water.
If I'm funding my bright nephew, let's say for the sake of argument that I really do just give him a wad of cash, I can expect by virtue of my high opinion of him, that he'll act wisely with it. If I don't have a high opinion of his fiscal responsibility then sure, I'll put it in a silo for college.
...just like I'll put Nepal money into a special "potable water" silo because I don't have a high opinion of Nepal's ability as a region to keep a local official's grubby paws off of it.
For one, I will second Ping. I don't see how funding a college education is "no strings" money, especially since you yourself mentioned GPA and no off semesters. On the other hand, in both cases what we want to do is control the way our money is spent. In case of nephew we want to make sure that the money goes to give him a college diploma (hence paying tuition instead of giving him money) and college education (hence minimal GPA restriction). In case of remote countries we want to make sure that something useful to the actual poor people gets done, a hospital built, food bought etc. and that these money don't buy a villa in the Caribbeans for some government official.
The "you" in the first paragraph is an individual. The "we" in the second paragraph is government. It doesn't get more apples and oranges than that. Granted, the "we" in the second paragraph might be a nonprofit group, but it's still a group.
When we give, why do we interfere so much more with distant poor, and interfere so little with those close to us?
You trust people you know more than you trust people you do not know.
How do you know that?
or, indeed, whether mosquito nets with strings attached are more effective or not.
One reason is that we have a lot more indirect pressure on those close to us; just giving the money to someone close to us pressures them to use it in ways we'd approve of (the words "son, make us proud" is a very powerful chain).
As for why we interfere with the distant poor, the reasons mentioned here are good. I'd add two more: there is a strong meme that aid doesn't work, or that the money is wasted. In that situation, one who doesn't want to see their donations wasted (ie most people) will either refrain from giving or give only with stringent strings attached.
The second is that our valuations of things (for ourselves, but especially for other people) does not follow the market. A mosquito net may cost the same as a bottle of whiskey, but we don't value them identically for others. Hence, strings. (extreme example of that: we tend to plan for the long term for others much more than we do for ourselves)
Finally, I'm surprised that no-one asked the question: is giving aid with strings attached more effective than with no strings, or not?
Aside from the aid being seized by the government (even if you gave cash payments to individual Nepalese, the government could respond by increasing effective rates of taxation), cash aid also creates increased dangers of citizen rent-seeking, e.g. criminal entrepreneurs have greater incentive to acquire fungible cash than bednets. By targeting a narrow class of goods like vaccines for a particular disease one may flood the market, preventing major rent dissipation.
Part of it is probably fear of corruption: give a poor country $100m, much of if may be stolen by officials. Build 1000 wells, and there are 1000 wells. Or at least that's the theory.