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Bargain Hunting for Charities

Gosh that sounds so stingy. When we are charitable, we don’t want to be cheap. This is our moment of giving, of generosity, not bah-humbugness. Alas, that is exactly what we should be. If we go to a restaurant for chicken wings, what would you think of the following prices:

4 chicken wings:            $8
6 chicken wings:            $8
8 chicken wings:            $8

Which would you opt for (assuming more is always better)? Naturally, it shouldn’t require much thought. So why not apply this to charity?

This is what Givewell does. (And I’m pleased to say, you can see the imprint of lots of research from Innovations for Poverty Action on their assessments and recommendations). You may remember I blogged about Givewell over the summer, and how there is no correlation between their assessment of organizational effectiveness and the horrid measure often used by those in search of a good charity, “general administrative and fundraising expenditures as a proportion of program expenses.”

When I give public talks on charity, I talk a lot about how to test what ideas work and why, and how randomized trials help us learn what we need to learn. I often get the obvious question: “Ok, so [blah] works, where do I send $50 to help some organization doing that?” That is a much harder question to answer. Alas Givewell does the hard work of combining the evidence from research and combining this with a scrubbing of the organization itself: how well they adhere to what the research says to do, how well they can absorb more funding, how well they monitor their activities to make sure money is spent well, etc.

Givewell has just released its list of recommended charities, just in time for the holiday giving season.

Their top two are:

Against Malaria Foundation: Fights malaria using insecticide-treated bed nets.

Schistosomiasis Control Initiative: Treats children for intestinal worms (helps improve school attendance!).

And their next six (in alphabetical order) are:

GiveDirectly: Cash grants to poor households in Kenya (trying to tackle the tough question of who knows best? Perhaps just giving cash away is best?)

Innovations for Poverty Action (disclosure: I am President of IPA) Research on how to fight poverty best, and to scale-up ideas proven most effective.

Nyaya Health: Healthcare in rural Nepal.

Pratham: Primary education in India.

Small Enterprise Foundation: Microfinance in South Africa.

In the United States, Givewell recommends  KIPP Houston, an outstanding charter school facing budget cuts.

It is also pleasing to see that, through independent decision-making, we at IPA in our Proven Impact Initiative came up with a strikingly similar set of charities, as our Proven Impact Fund is going to support three of the seven above named organizations (not counting IPA, of course).