A new study performed in six countries, among them Peru, showed that an intervention with an multi-dimensional approach addressed at the population in extreme poverty (approximately a thousand million people who live with less than $1,25 per day) incremented their productive assets, their income and registered improvements in health indicators. This intervention is known as “Model of Graduation from Extreme Poverty”, and it was implemented in Peru by Plan International, benefiting 2,284 ultra-poor homes of Cusco.
The “Graduation of Extreme Poverty” model combines productive asset transfers (guinea pigs, hens, cows or others); trainings in technical skills to manage a business; interventions in education and health and cash transfers, among other elements.
The study about the effectiveness of this intervention –which was carried out by IPA and published in the prestigious journal Science- and the results of the model in Peru were publically presented in Lima, Peru. Dean Karlan, Professor of Economics at Yale University and President and founder of IPA; Boris Choqueneira, Plan International’s Programme Manager in Cusco; and Carolina Trivelli, former Minister of Development and Social Inclusion of Peru, presented and discussed the results of the study.
By following 21,000 ultra-poor people in six countries where the “Graduation of Extreme Poverty” model was applied for three years, the study has been able to prove that the model is effective and has brought long lasting and meaningful impacts in their life standards.
In Peru, the model achieved the following results:
- Homes that were part of the programme increased their food consumption in 8%
- They saved 26% more than homes that did not participate in the Project.
- Homes in the programme earned about US$ 307 (2014 PPP) from cattle raising, which represents a 16% increase in relation to the comparison group.
- Homes in Peru reported being healthier and happier than homes that did not receive the programme.
- Researchers calculated the total implementation costs in US$2,604 per home in Peru. However, the estimated benefits in terms of consumption and growth of goods represented a 146% of return (US$8.380 per home).