Readers, I need your input. I am considering participating in Kiva. I am aware of some of the criticisms of microcredit, but unable to assess them. Naturally, this means that I will try to research the matter as thoroughly as I can. However, given the realities on the ground, I think it probably will take a year or more before I feel I have anywhere near the information needed to make an informed decision. So, here is the question: in the meantime, do I contribute or not?
I am not so much concerned about inefficiency, even if my funds do end up primarily enriching lenders—as Peter Singer has pointed out, if the best available way open to me to save someone's life is one in which 90% of my funds get skimmed off the top, that just means I have an obligation to contribute ten times as much.
My worry is that I will end up trying to hurt the people I am trying to help. One of the criticisms of microcredit is that, in practice, it ends up working like a Ponzi scheme once one gets to the lender level. There is no reason why microcredit must work this way, but I also can see how it might: it seems that it must depend on the average success rate of the entrepreneurs' businesses. This, in turn, is something for which detailed empirical data must be marshaled (and has been—but that's where the disagreement appears to be, which is what makes it so difficult for a layman to wander in). If microcredit tends, in practice, to work like a Ponzi scheme, then it must hurt more than it helps. But if it usually does not work that way, then the time I delay is time that I am not helping people who need it.
What do I do while I am researching?