I don’t quite get this — if they’re getting in-kind aid, presumably they don’t have money to put…

I’m just guessing, but maybe it works like this -

If people who need aid get cash, they can spend it in their local economy and the businesses they buy things from continue to operate and stay open.

If people get in-kind aid, they still don’t have money to buy things, but now if there is a big enough crisis where many people are getting aid and not able to buy things, the business closes and the owners may themselves then need aid.

It seems like this might apply more to areas where a large part of the population is getting the assistance, rather than just a few people in a big town.

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