Dean Karlan, a distinguished figure in development economics, took the reins as the chief economist of the US Agency for International Development (USAID) last year. His appointment was seen as a major step towards promoting rigorous evidence-based strategies within the agency.
In a recent interview with Future Perfect, Karlan shed light on his approach to infusing evidence into the spending process at USAID. Here are the key takeaways from their conversation:
Behavioral Economics Approach: Karlan’s philosophy is centered on applying behavioral economics principles to make the evidence integration process smoother. The core idea is to simplify and streamline the process, making it easier for stakeholders to incorporate evidence into decision-making.
Culture Change and Education: Karlan acknowledges the need for a cultural shift within USAID to embrace evidence-based practices. He highlights the importance of educating staff on distinguishing strong evidence from weak evidence, emphasizing that evidence is not limited to what USAID produces but encompasses the global evidentiary base.
Synthesizing Research: Karlan emphasizes the necessity of creating “how-to” guides tailored to USAID’s programs, synthesizing existing research into practical recommendations. This would assist enthusiastic staff in effectively implementing evidence-based approaches.
Understanding Program Effectiveness: Karlan discusses the challenge of discerning program effectiveness and cost-effectiveness. He illustrates this with an example of a randomized trial that compared individual meetings versus group meetings in a poverty alleviation program. The findings revealed that group meetings were cost-effective, demonstrating the value of such evaluations.
Barriers to Evidence Integration: Some barriers to integrating evidence within USAID include the absence of a formal step for evaluating cost-effectiveness during the awarding process, bandwidth issues, and additional demands related to gender, environment, and procurement fairness. These challenges make it crucial to prioritize evidence integration.
Quality of Impact Evaluations: While acknowledging the low percentage of high-quality impact evaluations, Karlan underscores that the goal isn’t solely to increase the proportion of awards with impact evaluations. Instead, the focus should be on filling evidence gaps where USAID can contribute to knowledge. Karlan emphasizes that impact evaluations should be guided by areas where the agency can genuinely enhance understanding and create positive global impacts.
Dean Karlan’s leadership at USAID reflects a commitment to infusing rigorous evidence into the agency’s initiatives, with the ultimate goal of maximizing the positive impact of foreign aid efforts. His approach highlights the importance of making evidence accessible, fostering a culture of evidence-based decision-making, and strategically choosing where to focus evaluation efforts for the greatest global benefit.