0000000000872217
AUTHOR
Joachim Thøgersen
A new aid modality for Africa
Preprint of an article published in the Journal of Economic Policy Reform with the title:“Stimulating economic growth in the least developed countries: Direct cash transfers for the retired via mobile phones,” The result of current aid policies is that only a small percentage of foreign aid reaches the poorest of the poor in the least developed countries. Current trends of urbanisation and self-reliance place elderly people in an increasingly difficult situation. This paper aims to stimulate debate by introducing an alternative mechanism for foreign aid. With the help of an economic model, we demonstrate how direct cash transfers to elderly people can spur economic growth. Targeting all eld…
A New Aid Modality for Africa: Old Age Cash Transfers
This paper examines the issue of foreign aid and cash transfers to individuals in low-income economies typically found in Africa. Old-age conditional cash transfers and new mobile banking technology can cope with the well-documented problems related to moral hazard and high transaction costs with such policy interactions. Cash transfers can stimulate old and retired individuals’ demand for the consumption goods and services, and thereby affect product prices and wages. Developing economies being characterised by underemployment and gross substitution between consumption and leisure, these transfers can stimulate the labour supply and increase capacity utilisation and the production of labou…
Stimulating economic growth in the least developed countries: direct cash transfers for the retired via mobile phones
The result of current aid policies is that only a small percentage of foreign aid reaches the poorest of the poor in the least developed countries. Current trends of urbanisation and self-reliance place elderly people in an increasingly difficult situation. This paper aims to stimulate debate by introducing an alternative mechanism for foreign aid. With the help of an economic model, we demonstrate how direct cash transfers to elderly people can spur economic growth. Targeting all elderly people above a certain age minimises selection costs and removes perverse incentives. The use of new mobile phone technologies reduces transaction costs and makes our proposed modality feasible including i…