Rooted School Foundation's "The $50 Study" Awarded $1 Million from the City of New Orleans Office of Economic Mobility

The $50 Study is a first of its kind study to measure the impact of direct, unconditional, cash transfers on teens.

NEW ORLEANS, Jan. 16, 2024 /PRNewswire/ -- The $50 Study was named a grant recipient from the City of New Orleans as part of their Economic Mobility in Motion Initiative. Rooted School Foundation (RSF) will receive $1 million to facilitate a multi-year study in which 800+ high school seniors in New Orleans will receive $50 a week for 40 weeks. The impact of these cash transfers will be studied during students' senior year of high school, and for the two years following graduation. This is the first, largest, and most rigorous study of its kind in the world exploring the long-term impact of providing direct cash to teenagers.

"The programs selected for the Economic Mobility in Motion program truly meet our people where they are and propel them forward, along with their families. We are investing our ARPA dollars to support thousands of New Orleanians who need it most, setting them up for success through improving their financial literacy, career opportunities and overall economic prospects. The selected programs represent a variety of initiatives that are making a real difference for our people, and I express my gratitude to them for ensuring no one is left behind as we move New Orleans forward," said New Orleans Mayor  LaToya Cantrell.

This iteration of the study builds on a multi-year Randomized Controlled Trial (RCT) facilitated by Rooted School Foundation in which 156 students across multiple grade levels were given $50/week for 40 weeks. Outcomes from the RCT are directionally promising and suggest that direct cash transfers have positive effects on students' well-being, financial literacy and capability, and academic performance. This study will contribute further to the body of research surrounding direct cash transfers by exploring the impact on postsecondary outcomes (e.g., college enrollment and persistence, employment).

This iteration of the study builds on a multi-year Randomized Controlled Trial (RCT) facilitated by Rooted School Foundation in which 156 students across multiple grade levels were given $50/week for 40 weeks. Outcomes from the RCT are directionally promising and suggest that direct cash transfers have positive effects on students' well-being, financial literacy and capability, and academic performance. This study will contribute further to the body of research surrounding direct cash transfers by exploring the impact on postsecondary outcomes (e.g., college enrollment and persistence, employment).

"Improving upward economic mobility in New Orleans, or any city, starts by giving students experience with an income. A $50 a week investment is leading young people to think about their lives differently, to invest in themselves and recognize what is worth – or isn't worth – their time. The early outcomes we're seeing are leading to life lessons that can lead to youth earning more than their parents," said Jonathan Johnson, Founder and CEO of RSF who also works with the Guaranteed Income & Health Consortium at Johns Hopkins Bloomberg School of Public Health.

Rooted Schools Foundation has already seen the impacts of $50 firsthand.

"When I think about the way The $50 Study has changed our student's lives-- by a mere $50 a week!-- I'm floored by what is possible. Whether it is starting a screen-printing business, investing in bitcoin, paying a family light bill, buying a special meal, being able to afford gas for a first car, not having to bother a hard-working parent about the cost of a new pair of shoes, or even just saving every penny for a future aspiration... our young people are exceptionally thoughtful about their money. And not just about spending it. They're deeply introspective about the habits that they are building, and the implications those habits will have on their futures. This experience is one of the best gifts we could ever give young people-- practice and experience in how to manage their money, and ultimately, build wealth. I cannot imagine a better opportunity for our youth," said Kaitlin Karpinski, Executive Director, Rooted School New Orleans.

About The $50 Study

The $50 Study investigates the impact of direct, unconditional cash transfers on reducing financial hardship, enhancing financial capability, and promoting upward economic mobility, as well as the impact on students' academic achievement and post-secondary outcomes. Participating students will receive $50 a week for 40 weeks during the 2024 - 2025 school year. The aforementioned outcomes will be measured during students' senior year of high school, and for the two years following their graduation.

"The '$50 Study' is an innovative tool to expand opportunity for students in New Orleans. Early results have shown that test scores, school attendance, and financial literacy increase for participants. I'm grateful that the City of New Orleans is investing $1 million in seed funding for this initiative to expand it to even more students, and I'm excited to see the results," said Olin Parker, Orleans Parish School Board President & Member, District 3.

During the 2024 - 2025 school year, approximately 1,600 12th grade students from New Orleans high schools will be randomly assigned to one of two groups, one that will receive $50/week unconditionally from 40 weeks (treatment group, ~800 students), and a control group that will not receive cash transfers. The study will collect quantitative and qualitative data for both groups through recipient surveys, transaction data, academic data, and interviews.

"Rooted School's $50 Study program suggests that direct cash transfers have a meaningful impact on students while they are in school. This groundbreaking study, which will examine the impact on high school seniors as they graduate and engage in post-secondary opportunities, will provide new insight into how cash may support young adults in the immediate moment and set them up for success in the long term," said Stacia West, MSSW, PhD, Director, Center for Guaranteed Income Research, University of Pennsylvania, Associate Professor, University of Tennessee College of Social Work

City of New Orleans Office of Economic Mobility

"The mission of the Office of Economic Development is to encourage inclusive economic growth and economic mobility by creating new jobs, revitalizing neighborhoods, investing in people and in priority industries, and creating systems to thrive. We envision a vibrant, equitable, and inclusive city where all New Orleanians – at every stage of their lives and in every neighborhood - enjoy access to economic opportunity, quality jobs, and a high quality of life for themselves and their families." The Economic Mobility in Motion: Moving New Orleanians Forward is funded by the American Rescue Plan Act (ARPA).

Rooted School Foundation will publish a mid-study report in Spring 2025. Additional storytelling efforts throughout the grant period, including a podcast led by students (Rooted Cash Podcast). Additional study updates are shared via Instagram (@the50dollarstudy); questions can be directed to [email protected]. Go to the50dollarstudy.org for more information on how to get involved.

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SOURCE Rooted School Foundation