<i>More generally, poor people “could easily save more without getting less nutrition by spending less on alcohol, tobacco, and food items such as sugar, spice, and tea,” Banerjee and Duflo conclude. For example, the typical poor household in Udaipur could spend up to 30 percent more on food if it did not spend money on alcohol, tobacco, and festivals.<p>Consuming alcohol and tobacco not only takes money away from a family’s nutrition, but also sets off a cascade of other problems that poor people more frequently encounter. Alcohol abuse, for instance, reduces work performance while increasing accidents, domestic violence, and illness. Because many indigent people earn their livelihoods through physical labor, falling ill means not earning money.</i><p>A small problem with their theory: Every last item they list has medicinal purposes. It's possible (and in my opinion very likely) that alcohol, tobacco, spices and tea are being used by "the poor" to self-medicate. For example, alcohol kills germs and poor people often live in filth. How do we know that their situation wouldn't be worse without it? If you want them to stop drinking, you would need to resolve the underlying reasons motivating them to drink -- which may well be rooted in "poverty" but it isn't necessarily rooted in lack of money per se.<p>Financial problems grow out of real problems. Resolve the underlying real problems and the financial problems tend to clear up on their own, or at least improve. Articles like this focus too much on money per se and too little on the real problems -- the problems which would still be harming these people and lowering their quality of life even if we lived in a Star Trek universe where money no longer existed.