Determining the effect of direct cash transfer programs for youth
Rooted School Foundation’s “The 50 Dollar Study” is a Youth Cash Transfer Study that provides $50 in cash directly to participating Rooted School students every week for one year. The program is a first-of-its-kind partnership done in partnership with the Center for Guaranteed Income Research at the University of Pennsylvania. The goal of this study, initially funded by New Orleans-based education non-profit 4.0 Schools, is to determine the effectiveness of direct cash transfer programs on youth experiencing financial hardship.
About The 50 Dollar Study
The 50 Dollar Study is a Randomized Controlled Trial (RCT) and the first study in the world to assess the effectiveness of a cash transfer program for high school students facilitated by Rooted School Foundation in partnership with the University of Pennsylvania Center for Guaranteed Income Research and the University of Tennessee – Knoxville School of Social Work. The study will investigate the impact of direct, unconditional cash transfers on reducing students’ financial hardship, enhancing their financial capability, and promoting upward economic mobility, as well as the impact on students’ academic achievement.
From 2022 – 2024, 470 students, grades 9-12, in New Orleans, Louisiana, Indianapolis, Indiana and Vancouver, Washington, will be randomly assigned to one of two groups, one that will receive $50 a week, the treatment group, and a control group that will receive no cash transfer. The study will collect quantitative and qualitative data through recipient surveys, transaction data, and interviews.
Research questions that we will explore during the study are:
1. Does guaranteed income promote students’ financial stability and freedom?
2. Does guaranteed income improve students’ financial capability and financial socialization?
3. How does guaranteed income impact students’ future orientation?
4. Does guaranteed income impact academic and school performance?
Are Direct Cash Transfer Programs Effective?
Direct cash transfer programs have arguably the strongest existing evidence base among anti-poverty tools, and the positive outcomes of cash transfers have been repeatedly demonstrated in studies around the world.
We are inspired by the work of organizations like GiveDirectly and the evidence supporting universal basic income and cash transfers in combating poverty.
- Cash transfers have well-documented positive effects on recipients worldwide, with dozens of high-quality evaluations of cash transfer programs spanning Africa, Asia, and Latin America.
- Studies consistently show that child tax credits and child allowances in other wealthy countries contribute to lower child poverty than in the US.
- Studies have shown that cash transfer programs lead to positive long-term outcomes as recipients often save or invest a portion of their cash.
- Despite stereotypes about how people experiencing poverty choose to spend their money, studies consistently show that recipients of cash transfers spend their money on things that positively impact their own lives.
Our Early Findings
During the 2020–2021 school year, we received an opportunity to test the impact of direct cash transfers with 20 students at our New Orleans campus – what would happen if we gave $50 a week to high school students without conditions for an entire year? Turned out that they spent the money on bare necessities and planning for the future. In partnership with the University of Pennsylvania and 4.0 Schools, we published the Penultimate Rooted Schools Report following the 2020 – 2021 micro pilot.
Rooted will publish initial findings from the Randomized Controlled Trial in Early 2024.
An ongoing podcast, The Rooted Cash Podcast, produced in collaboration with BeLoud Studios and hosted by Rooted Alumni Vernell Cheneau, shares recipient stories and experiences in narrative format. Additional study updates are shared via Instagram (@the50dollarstudy).
Interested in Supporting the Study?
So far, we’ve raised $75,000 for The 50 Dollar Study. In order to complete the randomized controlled trial, we need to raise an additional $50,000. Those funds will cover the costs of the cash transfers, banking fees, communication tools, and media and outreach. Our study is doing groundbreaking work to explore innovative interventions to create economic opportunity. If you are interested in being part of this first-of-its-kind, historical work, we encourage you to get involved by contributing to our Indiegogo campaign.
Questions and media inquiries about The 50 Dollar Study can be directed to email@example.com