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Stimulating economic growth in the least developed countries: direct cash transfers for the retired via mobile phones

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  • Roy Mersland

    (UIA - University of Agder)

  • Joachim Thøgersen

Abstract

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 selfreliance 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 in the least developed countries with low functioning governments.

Suggested Citation

  • Roy Mersland & Joachim Thøgersen, 2013. "Stimulating economic growth in the least developed countries: direct cash transfers for the retired via mobile phones," Post-Print hal-05220862, HAL.
    • Handle: RePEc:hal:journl:hal-05220862
    DOI: 10.1080/17487870.2013.799905
    Note: View the original document on HAL open archive server: https://hal.science/hal-05220862v1
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    References listed on IDEAS

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    1. Mark McGillivray & Simon Feeny & Niels Hermes & Robert Lensink, 2006. "Controversies over the impact of development aid: it works; it doesn't; it can, but that depends …," Journal of International Development, John Wiley & Sons, Ltd., vol. 18(7), pages 1031-1050.
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    6. Ralph Chami & Connel Fullenkamp & Samir Jahjah, 2005. "Are Immigrant Remittance Flows a Source of Capital for Development?," IMF Staff Papers, Palgrave Macmillan, vol. 52(1), pages 55-81, April.
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