Microfinance—providing small loans to help start small businesses—has been touted as highly transformative. While the impact of microfinance is likely positive, several studies now suggest that it is unlikely to change the fundamental logic of poverty. Feeding programs show some impact on children’s learning. Education has a robust but quite limited return. For years, nonprofit organizations have tried to provide a variety of holistic packages to address the varied needs of the poor. Surely they are doing good work. But they, too, have observed only modest returns.
