another economist supports direct transfers to the poor

Chennai: A system of conditional direct cash transfers to the poor is the “first best option” to address poverty in India, and would also lead to a “more efficient and rational pricing policy,” economist Arvind Subramanian said here on Saturday.

Attributing India’s “abysmal” record in poverty eradication programmes to “minimal state capacity,” Dr. Subramanian said the country’s well-placed equity concerns could be addressed better by direct cash transfer schemes, as they would “attain the [equity] objectives by minimising the demands made on state capacity.” Citing examples from Mexico and Brazil, he suggested linking cash transfer schemes to conditions such as children going to school, or receiving basic immunisation shots. A start could be made by introducing “experimental projects” in some States.

read the news report in the hindu. my earlier posts advocating a dole [1, 2, 3, 4, 5, 6 and 7].