I wrote this article in response to Roko's request for an article about efficient charity. As a disclosure of a possible conflict of interest I'll note that I have served as a volunteer for GiveWell. Last edited 12/06/10.

Charitable giving is widely considered to be virtuous and admirable. If statistical behavior is any guide, most people regard charitable donations to be worthwhile expenditures. In 2001 a full 89% of American households donated money to charity and during 2009 Americans donated $303.75 billion to charity [1]. 

A heart-breaking fact about modern human experience is that there's little connection between such generosity and positive social impact. The reason why humans evolved charitable tendencies is because such tendencies served as marker to nearby humans that a given individual is a dependable ally. Those who expend their resources to help others are more likely than others to care about people in general and are therefore more likely than others to care about their companions. But one can tell that people care based exclusively on their willingness to make sacrifices independently of whether these sacrifices actually help anybody.

Modern human society is very far removed from our ancestral environment. Technological and social innovations have made it possible for us to influence people on the other side of the globe and potentially to have a profound impact on the long term survival of the human race. The current population of New York is ten times the human population of the entire world in our ancestral environment. In view of these radical changes it should be no surprise that the impact of a typical charitable donation falls staggeringly short of the impact of donation optimized to help people as much as possible.

While this may not be a problem for donors who are unconcerned about their donations helping people, it's a huge problem for donors who want their donations to help people as much as possible and it's a huge problem for the people who lose out on assistance because of inefficiency in the philanthropic world. Picking out charities that have high positive impact per dollar is a task no less difficult than picking good financial investments and one that requires heavy use of critical and quantitative reasoning. Donors who wish for their donations to help people as much as possible should engage in such reasoning and/or rely on the recommendations of trusted parties who have done so.

The Overhead Ratio: Not a Good Metric

A commonly used statistic for charity evaluation which has a thin veneer of analytical rigor is a charity's “overhead ratio”: that is, the relative amounts of money spent on programs vs. administration. According to a press release issued in December 2009 by Philanthropy Action, Charity Navigator, GiveWell, Great Nonprofits, Guidestar and Philanthropedia :

For years, people have turned to the overhead ratio—a measure of how much of each donation is spent on “programs” versus administrative and fundraising costs—to guide their choice of charity. But overhead ratios and executive salaries are useless for evaluating a nonprofit’s impact.

While the idea of sending money “straight to the beneficiaries” is tempting, nonprofit experts agree that judging charities by how much of their money goes to “programs” is counterproductive. “Achieving a low overhead ratio drives many charities to behaviors that make them less effective and means more, not less, wasted dollars,” says Paul Brest, President of the Hewlett Foundation, and co-author of Money Well Spent.

The common focus on low overhead ratio has produced perverse incentives; pressuring some charities to skimp on administrative costs that would improve the efficacy of their programs. More importantly, cost-effectiveness of different charities' activities varies so dramatically as to totally eclipse any usefulness that the overhead ratio might have in a world of charities performing homogeneous activities.

A Comparison of Cost-Effectiveness

A well-known and well-funded charity is the Make-A-Wish Foundation, “a 501(c)(3) non-profit organization in the United States that grants wishes to children (2.5 years to 18 years old) who have life-threatening medical conditions.” According to the website's Managing Our Funds page:

The Make-A-Wish Foundation® is proud of the way it manages and safeguards the generous contributions it receives from individual donors, corporations and other organizations.

Seventy-six percent of the revenue the Make-A-Wish Foundation receives is allotted to program services. This percentage well exceeds the standard upheld by organizations that monitor the work of charities.

And indeed, the percentage allotted to program services is sufficiently high in juxtaposition with other financial statistics so that Charity Navigator grants the Make-A-Wish Foundation its highest rating. But how cost-effective are the charity's programs?

The Make-A-Wish Foundation 2009 Annual Report states that “A record-breaking 13,471 children had their wishes come true in FY09.” The annual report gives a break down of wishes by type: for example, 40.3% of the wishes were trips to the Walt Disney World Resort, 11.7% of them were shopping sprees, 7.1% of them were celebrity meetings and 5.5% of them were cruises.

The annual report claims that in 2009 the charity's “total program and support services” amounted a figure of $203,865,550. Thus, the Make-A-Wish Foundation implicitly reports to spending an average of $15,134 for each wish that it grants.

A charity that helps children in the United States far more efficiently is Nurse-Family Partnership which provides an approximately three year long program of weekly nurse visits to inexperienced expectant and early mothers for at a cost of $11,200 yielding improved prenatal health, fewer childhood injuries and improved school readiness. A deeper appreciation of how little good per dollar the Make-A-Wish Foundation does relative to what is possible requires a digression.


In November 2010 the United Nations released its 2010 Human Development Report ranking the world's countries according to a "Human Development Index" based on data concerning life expectancy, education and per-capita GDP. One of the lowest ranked countries on this list is Mozambique which has an infant mortality rate around 10%. This contrasts dramatically with the infant mortality rate in the United States which is less than 1%. Every tenth pregnancy in Mozambique is followed by the grief of losing a child within several years. A child in sub-Saharan Africa who survives past the age of five is more likely than not to live a full life extending past the age of 60 [2].

Why is the infant mortality rate in Mozambique so high? A major cause of death is infectious disease. Around a third of infants in Mozambique do not have the opportunity to receive the standard vaccinations for polio, measles, tentanus, tuberculosis, diphtheria and other fatal diseases because of the poverty of their surroundings and some of them will die as a result.

An organization called VillageReach is working to improve Mozambique's health logistics. Between 2002 and 2008 VillageReach ran a pilot program in the Mozambique province of Cabo Delgado designed to improve the province's health logistics. This program was dramatically successful. One tangible indicator of impact is that VillageReach increased the percentage of Cabo Delgado infants who received the third and final dose of the diphtheria-tetanus-pertussis vaccine from 68.9% to 95.4%, yielding a final percentage higher than that of the average in any sub-Saharan African country. When one looks at the available evidence in juxtaposition with the cost of the program and runs through cost-effectiveness calculations one finds that under conservative assumptions VillageReach saved an infant's life for every $545 donated to VillageReach.

Now VillageReach is in the process of expanding its operations to more provinces of Mozambique, hoping to expand its pilot project into seven more of Mozambique's eleven provinces over the next six years. VillageReach requires an additional ~ $1.5 million [3] to implement its proposal as fast as possible. In light of the fact that VillageReach has so far received only about 20-25% of this funding, it's plausible that additional donations will have a cost-effectiveness similar to that of those used for the pilot project.


Thus we see that while a $15,134 donation to the Make-A-Wish Foundation can be expected to grant an average of one wish to an ill child (a good thing all else being equal), a donation to VillageReach can 27 infants lives! With this framing it becomes clear that the amount of good per dollar that the Make-A-Wish Foundation is doing is negligible relative to that of VillageReach . No parent would prefer to send a child to Disney World over preventing even a single one of his or her children from contracting a life threatening illness!

Nor is this phenomenon of badly suboptimal giving specific to Make-A-Wish Foundation donors. Even if one restricts one's attention to the cause of health in the developing world [4], many donors donate to charities pursuing health interventions in the developing world that do a thousand times less good per dollar than the most cost-effective health interventions.

A hypothetical charity running programs like VillageReach's which embezzled 95% of its budget and had correspondingly greatly reduced cost-effectiveness would still be doing far more good per dollar than the Make-A-Wish Foundation or the least effective developing world charities do. This example makes it clear how profoundly useless the overhead ratio is for assessing the relative quality of a charity.

Holding Charities Accountable

Donors should be aware that charities frequently cite misleading cost-effectiveness figures in their promotional materials. And just because a charity claims to be performing activities of very high value doesn't mean that the charity is performing the activity as reported. William Easterly recently commented on Peter Singer's child in a pond metaphor [5] saying:

In our situation trying to help a poor person, what we're actually doing is we're not physically able to rush in ourselves and save the child. In fact, we are not even able to observe whether the child is saved or not. What we are doing is we're sending money off to someone else on the other side of the world...and we're counting on them to save the child. And so I guess to put the metaphor another way, if your person who was saving a child was in a situation where they were physically unable to help and they knew they had to delegate it to someone else, then it would also be morally reprehensible if they did not find a person who was reliable who they were sure was going to save the child. And it would be morally reprehensible if they did not in fact check up to make sure that the child was saved. That would be just as morally objectionable as your situation of yourself directly failing to rush to the aid of the child.

Of course, for a donor with limited time and energy it is frequently not possible to personally check that a charity is performing its stated function. As such, it is useful to have independent charity evaluators that evaluate charities for impact. The only such organization that I'm familiar with is GiveWell which has reviewed 409 charities working in the areas of equality of opportunity in the United States, health in the developing world, and economic empowerment in the developing world and has highlighted those charities with the strongest evidence of positive impact. VillageReach is currently GiveWell's top ranked charity in the cause of health in the developing world.

There are many causes that GiveWell has not yet covered and there may be charities working in them that absorb donations substantially more cost-effectively than VillageReach does. GiveWell has prepared a Do-it-Yourself Charity Evaluation Guide as an aid to donors who are interested in personally investigating charities working in causes that GiveWell has not yet covered.

Volunteering, Nonprofit Work and Cost-Effectiveness

So far I've restricted my discussion to charitable giving. Giving is not the only philanthropic activity that people engage in;  some people volunteer their time to benefit others and some people choose to forgo income to work at a lower paying nonprofit job that they deem to have greater social value than the job that they would otherwise take. There are many instances in which such philanthropic activities are the best way to help people, but one should consider such activities against the backdrop of there being huge variability in the cost-effectiveness of philanthropic activities. GiveWell's recommended charities have set a concrete minimal standard for optimizing cost-effectiveness of philanthropic activities.

To determine whether or not volunteering or taking a nonprofit job is a good way of helping people, one should compare additional positive impact that one would have by switching jobs with the positive impact that one would have by donating all of one's forgone income to the most efficient charity that one can find. For those with low earning potential and skills that are useful and rare in the philanthropic world, the most efficient way of helping people will typically be volunteering and/or non-profit work. For those who have high earning potential and lack skills that are especially rare in the philanthropic world the most efficient way of helping people will typically be taking a high paying job and donating one's income to an efficient charity. [6]

Of course, many people who volunteer or forgo income to work at a non-profit do so not only with a view toward helping people but also because they want to experience the visceral sense of helping people directly or of working directly on a cause that they feel passionate about. This latter factor can be a good reason to engage in such activities. Humans are not automatons capable of persistently adopting the most efficient course possible. Fulfilling our own very substantial personal needs and desires is important to maintaining good health and energy. At the same time, in view of the great variability of cost-effectiveness of various philanthropic activities, if one doesn't devote some resources toward helping people as efficiently as possible, one will probably accomplish very little of one's potential capacity to make the world a better place. [7]

Conclusion

People often have good intentions and frequently fail to direct them to create the substantial positive impact that they could if they thought carefully about how to do as much good as possible. I have already mentioned GiveWell as a useful resource for donors who interested in accomplishing the most good for their dollar. Such donors may also find it useful to visit Giving What We Can which is a society whose members pledge to donate a portion of their income “to whichever organizations can most effectively use it to fight poverty in developing countries” and whose members “share advice on the most effective ways to give.” By thinking critically and making use of available resources, one can reasonably expect to be able to have a much greater positive social impact than one otherwise would be able to.


Footnotes

[1] Figures taken from a survey by Independent Sector and The Annual Report on Philanthropy for the Year 2009.

[2] According to calculations by GiveWell using data from the World Health Organization.

[3] See the section of GiveWell's review of VillageReach titled Room For More Funds?

[4] For an indication of the relative cost-effectiveness of health interventions in the U.S. refer to a 1995 academic journal article from titled Five-Hundred Life-Saving Interventions and Their Cost-Effectiveness.

[5] In a December 2009 BloggingHeads Diavlog with Peter Singer. William Easterly is an economist at NYU and author of the Aid Watch blog

[6] Alan Dawrst's essay titled Why Activists Should Consider Making Lots of Money gives more on this topic.

[7] Eliezer Yudkowsky's Purchase Fuzzies and Utilons Separately gives a nice discussion of this theme.

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Are there any really good reasons for this kind of charity (throwing money at some highly specific problem affecting some very poor people without changing anything about the system), as opposed to paying for vastly underfunded highly scalable public goods such as wikileaks, wikipedia, or even GiveWell for that matter?

In the world we currently live in, nearly all "poor" people are reasonably well off by historical standards, with their standards of living extremely rapidly improving anyway. Global inequality is far below historical peak as well.

I like what GiveWell does on the margin, but we'll run out of abjectly poor people outside warzones (like DRC, Afghanistan) or disaster zones (like Haiti) before they get good at what they're doing.

To give you some perspective, take a look at this map. You see those black areas? They still live longer, are better nourished, better educated, and better off in every possible sense than world average just a century ago and very rapidly improving.

Is GiveWell a "good" charity? Have they assessed themselves?

It looks like they have evaluated themselves.

I'm not surprised they would do that. They are the canonical example of a ridiculously transparent organization. For instance, their admission of their own mistakes and shortcomings is heroically vigorous.

I searched for "metafilter" and was disappointed, then looked closer and realized the incident actually was mentioned, under "overaggressive and inappropriate marketing". Huh.

Löb's Theorem! Trust GiveWell because you evaluate it as trustworthy; not because it has evaluated itself!

That reduces self-evaluation to signalling. I suppose you could factor "they costly signal transparency" into your evaluation of GiveWell.

edit: Having read about their disciplinary action, I would like to revise my previous statement to "they extremely costly signal transparency"

Is GiveWell a "good" charity? Have they assessed themselves?

If they have would there be much point in having made the assessment public?

Upvoted.

Recall the purpose of the present article. See JGWeissman's comment. Explicitly citing tangible charities with easily measurable output is useful for discussing of effective philanthropy with people who have not thought about the topic.

I'm not at all committed to a particular cause and could easily imagine the cost-effectiveness of such highly scalable public goods being much greater. As I say above:

There are many causes that GiveWell has not yet covered and there may be charities working in them that absorb donations substantially more cost-effectively than VillageReach does.

My present interest in VillageReach over charities working in other causes is about incentive effects. VillageReach has a strong case for being outstanding at what it does and a strong case for room for more funding. I think that funding such a charity sends a message to the philanthropic world that such charities will be rewarded and produces a good incentive effect. As I said elsewhere

I believe that supporting GiveWell's recommended charities has high expected value because I believe that doing so strengthens a culture of effective philanthropy and that in the long run this will meaningfully lower existential risk.

I would welcome any suggestions here. It seems like there might be an issue of the intended signal to the philanthropic world being misinterpreted on account of GiveWell's (brief) history of focus on charities engaged in projects with highly tangible and measurable impact.

I think it's pretty clear that scalable public goods are more effective than per-person interventions like giving a child a pill or a vaccination. But scalable public goods are really hard to analyze; e.g. existential risk mitigation.

We just want a nice simple case to get people started on.

You see those black areas? They still live longer, are better nourished, better educated, and better off in every possible sense than world average just a century ago and very rapidly improving.

200 Countries, 200 Years, 4 Minutes

I like the argument, but I'm not sure the data you cite adequately supports your claim! The world averages show people's life expectancy a century ago in the mid-to-upper 30's, and the black areas on your map are "40 or less." We don't know from the map exactly what the life expectancy is.

Also, we don't know from the map whether lower life expectancy 100 years ago was the result of sudden, acute fatalities from epidemics, short conventional wars, etc. or if it was the result of generally lower standards of living.

I'd be curious to see data on how global inequality has changed over time. I suspect it matters whether you compare countries or individuals. I also suspect that while there might be a few moments in history (e.g. the height of the Roman and Han empires, the height of the Hapsburg and Aztec empires) when wealth was even more concentrated than it is today, making your claim that global inequality is far below historical peak literally true, it is still likely that global inequality is currently at an above-average level.

Finally, even if you sort all that out, you still need to give some reason why "highly scalable public goods" are more useful than poverty reduction. What is "the system" that you mention? Who benefits when the system changes, and how?

and the black areas on your map are "40 or less." We don't know from the map exactly what the life expectancy is.

But we know this. Other than Swaziland with conflicting data, the world's worst few are in 38-42 range depending on source.

Also, we don't know [...]

Stop saying "we don't know" if the answer is 15 seconds of googling or Wikipedia'ing away.

I'd be curious to see data on how global inequality has changed over time.

Here's our best estimates of global inequality (of individuals). Peak inequality was somewhere in mid 20th century. Most estimates of global inequality before Industrial revolution place it around gini 50-ish - with vast majority of people being about as poor.

Finally, even if you sort all that out, you still need to give some reason why "highly scalable public goods" are more useful than poverty reduction.

Charities we're talking about don't do poverty reduction. They alleviate some of the worst consequences of poverty, that's all.

Stop saying "we don't know" if the answer is 15 seconds of googling or Wikipedia'ing away.

Even when the point you are making happens to be correct, please don't complain that the people your are trying to convince did not do the (possibly trivial) work to gather supporting evidence you did not include in your argument.

This is general background knowledge everybody should have. It was pretty much like saying "we don't know if more people live in China or Japan". Well, except we do, and it's trivial to find.

The very "trying to convince" approach is highly counterproductive, what we should be trying is finding truth.

I agree with JGWeissman here. You have a lot to offer in the way of knowledge and clear thinking and on the whole I enjoy reading your comments, but I feel that the net value of your contributions to LessWrong would be enhanced if you took to heart the points that Alicorn makes in her article titled A Suite of Pragmatic Considerations in Favor of Niceness.

I've read it, but I'm not a big fan of niceness in this context. There's a reason why all groups that try to get things done effectively seem to drift towards blunt and rude end of the spectrum. Niceness is an overhead, but it's also a highly asymmetric overhead - some points of view are taxed by niceness requirements far worse than others, so it ends up introducing a pretty drastic bias. For example status quo supporters tend to have least trouble being "nice".

Alicorn might be well-meaning here, but I haven't seen any decent evidence that niceness is appropriate in this context.

This is general background knowledge everybody should have.

I do not consider regional life expectancies, or historical limiting factors on lifespan, to be general background knowledge that everybody has.

The very "trying to convince" approach is highly counterproductive, what we should be trying is finding truth.

Questioning perceived flaws in an argument is a tool of truth seeking, as is strengthening the argument to address those questions. But complaining that the questioner should have strengthened the argument themselves is a status play that serves to discourage questioning.

Charities we're talking about don't do poverty reduction. They alleviate some of the worst consequences of poverty, that's all.

What do you mean?

It is fairly well established that there's no meaningful correlation between aid and economic growth.

The best you can claim is that aid alleviated some suffering. I'm willing to accept that, but to be honest I don't really care much about this.

I'll leave it to you to explore all theories on why aid doesn't work, there's plenty and it would be irresponsible to donate without learning a bit about this.

I couldn't get anywhere from this latest link -- it's a dead Wikipedia page for me.

Part of why I asked what you mean is that "aid" sometimes encompasses great power military aid and aid from the IMF, World Bank, etc. -- institutions whose primary motivation is often not so much to reduce poverty as it is to promote loyalty to the great power or to the neoliberal economic ideology du jour. I'm not just saying this out of generic leftish peevishness; the tribal part of my brain is quite glad, e.g. that America is donating billions of dollars to the Israeli military, but I wouldn't expect that to have more than a trivial effect on, e.g., increasing the job opportunities for Ethiopian Jews. Likewise, as a holder of Argentinian bonds, I'm pretty happy that the IMF is offering "aid" to support the Argentinian budget, but I can't pretend that this aid will ever reach los gauchos. On the contrary, it'll probably cut their government health benefits.

It's cool if you don't care about suffering per se and you do care about economic growth, but honestly I find it hard to even articulate a hypothesis on which, e.g., de-worming initiatives don't foster economic growth. I wouldn't be starting many local businesses if my brain couldn't get calories out of my gruel because they went to a tapeworm first.

It's cool if you don't care about suffering per se and you do care about economic growth, but honestly I find it hard to even articulate a hypothesis on which

Let me help you with some hypotheses, all of them take place in the real world to some extent, but I have little idea which are important, and which aren't:

  • Governments have less incentive to run deworming campaigns on their own - they know failure will invite aid, and they can spend money they planned for deworming on shiny military hardware and/or Spanish real estate
  • Poor farmers at first have more money, but governments and their absentee landlords soon notice it, and raise taxes and rents, leaving them as miserable as before, all money ending up buying shiny military hardware and/or Spanish real estate
  • Governments become less accountable to taxpayers - and more corrupt - and more to foreign aid organizations - this aid usually comes with strings attached
  • Large inflow of foreign money makes exchange rates less beneficial to local exporters, and as these are usually struggling businesses barely making it, and also one of main drivers of sustainable economic growth, this disruption can be extremely bad

Thanks, that's helpful. Feel free to poke me in 2-3 weeks when I've had time to digest this.

Agree that the first two hypotheses are possibilities (but still think that the expected value is positive). The last two hypotheses don't seem relevant to the interventions under discussion.

The third had some decent support at least for mineral income. Countries with a lot of money from export of oil and similar goods tend to have low taxes and be most corrupt and least democratic, while countries with broad tax base tend to have less corruption and more democracy.

I'd expect similar effect for foreign aid if it became large enough. I don't have these studies bookmarked, in any case this was just a request for hypotheses.

Sure, but Mass_Driver was discussing deworming initiatives specifically rather than aid in general!

Well, let's go back to efficient market hypothesis. If (deworming / your other favourite cause) is indeed such a great investment, why aren't affected people or their governments already buying it?

I can think of a few plausible hypotheses - the most obvious one would be coordination problems with various kinds of vaccinations, and other public or semi-public goods.

However, most analyses don't do that, they just implicitly assume that everyone in the affected country is a total idiot, while the enlightened donors will show them the light.

I'd expect people over there have much better idea of what they need, while donors acting mostly like total idiots in this context, who do things for warm fuzzy feeling, not guided by the kind of analysis they'd use if it affected them directly. Zero net effect of aid seems to confirms that all too well.

I'm sympathetic with your skeptical prior as to the value of outside interventions and with your frustration with the widespread naivete on these points.

In the case of the health interventions under discussion I think that the point is that the people who live in the affected areas are living on a dollar or less a day and can't afford the cost of procuring the relevant vaccinations, medications, etc.

In a libertarian spirit one can ask "Why not just give money to the poorest people and let them spend it in the way they deem most useful?" To this end you might be interested in Holden's posts:

  1. Why not just give out cash?

  2. Philanthropy Vouchers

  3. Should I give out cash in Mumbai?

In the case of the health interventions under discussion I think that the point is that the people who live in the affected areas are living on a dollar or less a day and can't afford the cost of procuring the relevant vaccinations, medications, etc.

We are quickly running out of people that poor:

World poverty is falling. Between 1970 and 2006, the global poverty rate has been cut by nearly three quarters. The percentage of the world population living on less than $1 a day (in PPP-adjusted 2000 dollars) went from 26.8% in 1970 to 5.4% in 2006.

Of course we just readjust our definition of poverty line higher - $1.25/day is the minimum used these days, and $2/day and $3/day lines are becoming increasingly common.

If some people stay extremely poor in the middle of global convergence, we should probably focus on whatever is stopping them from participation in it - and these are highly location specific factors.

One common cause are wars and military occupation. For example which charity works best to end Israeli blockade of Gaza, or American occupation of Afghanistan? IHH Humanitarian Relief Foundation? Hamas itself? (good luck donating to them)? Wikileaks? Of course in all such conflicts money is very likely not to reach intended recipients.

That's very different from traditional charities. My best bet here is Wikileaks, they have quite some track record on both third world corruption and military atrocities, and money donated to Wikileaks is unlikely to end up funding more weaponry fueling the conflict.

In a libertarian spirit one can ask "Why not just give money to the poorest people and let them spend it in the way they deem most useful?" To this end you might be interested in Holden's posts:

I'm quite sympathetic towards give-out-cash and even more in microfinance. I'm not sympathetic towards how these programs often end up serving ideological agenda. Like microfinance world's ideological obsession about lending to women, while men universally do most of economic activity:

Because of all this received wisdom in the marketing narrative, arguably the day’s most surprising and controversial presentation was given by David McKenzie of the World Bank. McKenzie reported the results of a three year study of 600 microenterprises in Sri Lanka. The participants in the study were emblematic of the standard image of the micro-entrepreneur: small businesses (with no employees other than the owner) that have very little capital. The only difference is that half of the 600 microenterprises studied were run by men rather than women. Each of the microenterprises received a grant (not a loan) of $100 or $200, assigned randomly. After receiving the grant, the enterprises were tracked and surveyed quarterly for up to three years.

The results were unequivocal. Men achieved an average return on capital of 11 percent. Women achieved a return on capital that was a little worse than 0 percent.

I'd be surprised by the opposite result.

Anyway my rankings are:

  • Public goods (Wikileaks)
  • Microfinance (results might not be that awesome, but it more or less self-propagates)
  • Well targeted health interventions like Village Reach
  • Buying poor people booze (so they can spend their booze money on something else)
  • Traditional charities

Thanks for the interesting references! In particular, you've inspired me to look into Wikileaks (which I hadn't heard of before aside from the recent news).

Concerning microfinance; I myself currently know almost nothing about the topic; my knowledge comes almost exclusively from following the GiveWell blog. See

  1. Where We Stand On Microfinance (From a year ago, possibly dated.)

  2. Microfinance charity

It would be great if you looked at and critiqued some of their work. I think you might enjoy doing so. According to their page about their process

We believe that "Where should I give?" is one of the hardest questions there is, and there's no single field of knowledge or expertise that can take it on completely. Instead, we seek to put our thoughts in public as a starting point, and get as many perspectives from the outside as we can. If you have thoughts on our analysis, please don't hesitate to contact us.

My own experience has been that they take this statement to heart.

It might be my inner contrarian speaking.

From quite glance GiveWell seems to be using totally wrong margins.

They compare average microfinance with best health interventions.

Valid comparison would be either average microfinance with average health intervention, or marginal microfinance with marginal health intervention. "Best" is never a valid measure, let alone comparing best something with average something else.

Compare this situation:

  • Donors pay $1bln to fund amazingly efficient vaccination program
  • Government pays $10bln for random not too efficient health services

With:

  • Government pays $1bln to fund amazingly efficient vaccination program, and $9bln for random not too efficient health services
  • Donors pay $1bln for not too efficient health services

Donors will surely feel a lot more awesome in first scenario than in the second, but there's no difference between them at all. And unless the government is too stupid or too evil to fund this amazingly efficient vaccination program, if donors pulled out the result would be in either case:

  • Government pays $1bln to fund amazingly efficient vaccination program, and $9bln for random not too efficient health services

Of course this was based on optimistic assumption that configuration wouldn't be:

  • Donors pay $1bln to fund amazingly efficient vaccination program
  • Government pays $9bln for random not too efficient health services, and $1bln for bombs to bomb neighbouring country

In which case donations would have massive negative utility. That's fungibility of money. Analysis of net effect of donations isn't impossible, but they're not doing it, so they should stick with broad-based averages as the second best thing.

On the other hand what can have a lot of value is researching relative effectiveness of various interventions when we don't know yet which works better. This is true not just in case of poorest countries, but even more so for huge welfare programs ran in rich countries with nearly no research.

Now this might be wrong, but impression I'm getting is that microfinance attracts a lot more research than other types of interventions, which tend to be rather hostile even to the idea of randomly assigning people to control and intervention group as a rule.

From quite glance GiveWell seems to be using totally wrong margins.

They compare average microfinance with best health interventions.

Yeah, I'm not really sure what the intended purpose of the linked post was. I would guess they were trying to say something like "donating to one of GiveWell's top recommended health charities seem to be a better bet than donating to a random microfinance charity" but I agree the implied comparison of health as a sector with microfinance as a sector is misleading.

"Best" is never a valid measure

GiveWell is focused on finding the best charities for casual donors rather than assessing the merits of entire charitable causes. Note that they recommend Small Enterprise Foundation as an outstanding microfinance charity.

Donors will surely feel a lot more awesome in first scenario than in the second, but there's no difference between them at all.

Yes, this is true. See negative and offsetting Impacts.

On the other hand what can have a lot of value is researching relative effectiveness of various interventions when we don't know yet which works better. This is true not just in case of poorest countries, but even more so for huge welfare programs ran in rich countries with nearly no research.

In which case donations would have massive negative utility.

My (vague) impression is that developing world countries with militaristic governments which devote a lot of financial resources to military spending often do so despite the fact that their poorer citizens have unmet basic needs. To the extent that this is true it points in the direction of supplying health interventions being unlikely to displace government money in the direction of military spending.

On the other hand what can have a lot of value is researching relative effectiveness of various interventions when we don't know yet which works better. This is true not just in case of poorest countries, but even more so for huge welfare programs ran in rich countries with nearly no research.

I have a similar impression here.

Now this might be wrong, but impression I'm getting is that microfinance attracts a lot more research than other types of interventions, which tend to be rather hostile even to the idea of randomly assigning people to control and intervention group as a rule.

This could be; I know almost nothing about the topic.

GiveWell is focused on finding the best charities for casual donors rather than assessing the merits of entire charitable causes. Note that they recommend Small Enterprise Foundation as an outstanding microfinance charity.

I understand this point of view, but if Vilalge Reach is clearly so much better than an average health charity (as GiveWell seems to be certain of), shouldn't they just get other health charities to reallocate a small portion of their vast funds to Village Reach?

How large a violation of EMH are we willing to accept here with how little evidence? Now EMH fails in many contexts for many reasons, but this really begs for some explanation. Why should we trust GiveWell if even other health charities seem not to? Even if they're not certain, even modest level of agreement should result in transfer of funds a lot larger than what Village Reach currently gets.

Unfortunately there are only two possibilities in equillibrium here:

  • Other health charities drastically disagree with GiveWell.
  • Other health charities agree with GiveWell, some funds get reallocated, Village Reach gets very high coverage, marginal utility of health dollars falls down to mid tier charities.

EMH says GiveWell should only be trusted if we can observe ongoing large shifts of funding towards charities it promotes. It will lose informational value eventually but donations accelerate this shift towards more efficient charities.

Do we see this happening (in which case go ahead and donate to Village Reach), or is everyone ignoring GiveWell (in which case the crowd might have a point, and don't blindly trust GiveWell).

My (vague) impression is that developing world countries with militaristic governments which devote a lot of financial resources to military spending often do so despite the fact that their poorer citizens have unmet basic needs. To the extent that this is true it points in the direction of supplying health interventions being unlikely to displace government money in the direction of military spending.

There was never really any country that could entirely disregard population's needs.

My model - you need some level of spending X to keep country's economy from collapsing and population from revolting. Everything more than that goes to military. If foreign donors give you Y for that, then X-Y of your spending will be enough to keep country's economy from collapsing and population from revolting, leaving X more for military hardware. Even if Y>X, they'll figure a way to embezzle excess funds.

This model is too extreme, but so is naive assumption of no offsets.

I understand this point of view, but if Vilalge Reach is clearly so much better than an average health charity (as GiveWell seems to be certain of), shouldn't they just get other health charities to reallocate a small portion of their vast funds to Village Reach? [...]

  1. VillageReach stands out for transparency, monitoring and evaluation and focus on a cost-effective program. Where this places VillageReach relative to other health charities in impact per dollar depends in some measure on what one's default assumption is about a charity's effectiveness in the absence of information. The GiveWell staff have a skeptical default assumption; the plausibility of which can be questioned. Note however that there are charities that that focus on the cause of clean water which is the DCP report lists as being something like 500 times less cost-effective than increased immunization; this pushes in the direction of adopting a skeptical default assumption.

  2. The idea of getting other health charities to reallocate money to VillageReach is an interesting one but I suspect it's infeasible for political reasons (employees of a generic health charity are motivated to keep the money donated to the charity within the organization as sending it elsewhere might entail layoffs, etc.).

  3. There's no profit motive attached to providing health services more efficiently so the usual hypotheses of the EMH are not in place. Again recall my earlier comment about donors not paying attention.

In view of this it seems that essentially the only factor that pushes in the direction of EMH in the non-profit world is altruism; but altruism in humans is limited and easily crowded out by tribalism and by (wishful thinking)/(need for self-image preservation).

My observation (e.g. as a student in public high school some time ago) is that there's a tendency for badly inefficient policies to persist in the non-profit sector because the people who are perpetuating them find it uncomfortable to admit that the policies that they've been adhering to are defunct and correspondingly delude themselves into believing that they're just fine as they are.

Do we see this happening (in which case go ahead and donate to Village Reach), or is everyone ignoring GiveWell (in which case the crowd might have a point, and don't blindly trust GiveWell).

GiveWell has only been around since 2007 and only has four employees. My impression is that it's presently little known within the philanthropic sector. Last year they leveraged a million dollars which is only 1/300000 of the total U.S. charitable contributions in 2009.

They have not made a systematic attempt to publicize their findings beyond their website up until now (no advertising, etc); so far preferring to focus on making their research and research process more robust with a view toward building a more solid product of broader interest.

In interest of building credibility, GiveWell has been asking outside volunteers to vet their research.

Potential donors seldom reject GiveWell's recommendations on account of doubting the credibility of their analysis; much more common reasons for rejection are:

  1. Squeamishness about mixing rational analysis with charity on account of seeing rational analysis as "cold and calculation" and charity as "warm and fuzzy." This is not at all common on LW (!) but fairly common in broader society.

  2. Lack of interest in the causes that GiveWell has covered so far.

  3. Prior commitment to particular charities that they've become attached to.

My model [...]

I follow, but your model seems so extreme as to be a self-characiture! :-)

This model is too extreme, but so is naive assumption of no offsets.

Agree.

I follow, but your model seems so extreme as to be a self-characiture! :-)

What's the best evidence against it, or quick test that would be able to at least tell maximally naive model apart from maximally cynical model?

Do we really know totally nothing about that?

It is fairly well established that there's no meaningful correlation between aid and economic growth.

You seem to be Missing The Trees For the Forest. The statement that on average aid has not contributed to economic growth does not imply that the best foreign aid charities do not contribute to economic growth.

See, e.g. a comment by Unnamed. I agree that there's not an ironclad case that donating to such charities having positive impact on countries' economic growth, but would you bet against it? If so, with what odds and why? At present I judge the expected impact on economic growth to be positive.

If on average aid has not contributed to economic growth, and the best foreign aid charities positively contribute a lot to economic growth, then as many other foreign aid charities negatively contribute a lot to economic growth, and people cannot tell them apart (if they could, they would definitely shift their contributions).

The result that macro effects are about zero is pretty solid, what terms of the bet are you proposing as I'd take it if it wasn't for difficulty of measurement.

If on average aid has not contributed to economic growth, and the best foreign aid charities positively contribute a lot to economic growth, then as many other foreign aid charities negatively contribute a lot to economic growth

My impression is that the situation is closer to a very large majority having small negative impact and a very small minority having a large positive impact.

people cannot tell them apart (if they could, they would definitely shift their contributions).

The reason that people cannot tell them apart is that they're putting essentially no effort into doing so. According to the recent Money for Good study only $4.1 billion of the $300 billion donated mentioned in the above was donated by donors who do research comparing multiple charities when deciding where to give. It's plausible that donors who make an active effort to maximize the positive effects and minimize the negative effects of their donations can do far better than the average donor.

what terms of the bet are you proposing as I'd take it if it wasn't for difficulty of measurement.

I'm not literally proposing a bet; I'm just saying that while it could be that donating to charities like Deworm the World and VillageReach doesn't have a positive impact on economic growth, I judge the expected value to be moderately positive and I don't see any reason to think otherwise.This is in line with MassDriver's comment

honestly I find it hard to even articulate a hypothesis on which, e.g., de-worming initiatives don't foster economic growth. I wouldn't be starting many local businesses if my brain couldn't get calories out of my gruel because they went to a tapeworm first.

There are plausible explanations for why the net effect of aid has been trivial that don't preclude the hypothesis that the interventions under discussion are effective.

According to the recent Money for Good study only $4.1 billion of the $300 billion donated mentioned in the above was donated by donors who do research comparing multiple charities when deciding where to give.

This implies that GiveWell is much better charitable cause than Village Reach.

In any case, all of my charitable budget goes towards provision of public goods - this has clear large net positive effect, while alleviating suffering would only have positive effect under some rather strong assumption about how well informed I am.

I haven't donated anything to CPC yet (other than a few throwaway comments about how remarkable their performance has been, I tend to do that for things I like and it's hardly much of "charity"). I consider this a very interesting idea, but I'd like someone else to verify that it makes sense.

Upvoted.

Actually, the situation is probably quite a bit worse than the $4.1 billion figure that I cited suggests: "doing research comparing multiple charities" probably entails visiting several charities websites and/or referring to charity watchdog organizations which rate charities on financials rather than impact.

This implies that GiveWell is much better charitable cause than Village Reach.

If one ignores signaling/incentive effects then I agree.

Up until this point, GiveWell has been focusing on attracting donations for its recommended charities rather than soliciting money for itself. The more money GiveWell moves the more influence it will have subsequently. Whether or not donating to GiveWell's recommended charities is genuinely a good way to support GiveWell is unclear to me; but what I've done so far on their recommendation.

I think that their thinking has been that they want to prove that they're doing something tangibly useful by directing more money to their recommended charities before fundraising for themselves. Presumably this comes from their emphasis on proven programs.

I personally would like to see them shift toward evaluating charities like Wikipedia, etc. for which it's more difficult to assess the impact but which have potentially very high expected value.

In any case, all of my charitable budget goes towards provision of public goods - this has clear large net positive effect, while alleviating suffering would only have positive effect under some rather strong assumption about how well informed I am.

Sure, makes sense. If you're interested I'd encourage you to fill out GiveWell's survey - this could influence what causes they look into next and help you optimize your public goods donations. They've been going where the interest is, presumably in an effort to gain broader traction (e.g. they started looking into disaster relief as a cause in response to receiving a number of queries from prospective donors).

I haven't donated anything to CPC yet (other than a few throwaway comments about how remarkable their performance has been, I tend to do that for things I like and it's hardly much of "charity"). I consider this a very interesting idea, but I'd like someone else to verify that it makes sense.

Interesting :-). Is the CPC accepting donations?

Maybe better still would be to fund a (hypothetical) advocacy group that offers the CPC money in exchange for greater openness / freedom of speech in China (potentially leading to simultaneous progress on two fronts at once)? (This idea presupposes that straightforwardly increased civil rights in China would not indirectly reduce its economic growth; an assumption which admittedly may not be valid.)

It is clear to me that the real efficient charitable cause is rationality itself. Givewell is giving money to VillageReach as a way of proving to stupid, irrational people that efficient charity is better than random charity. (Duh).

But if you could find a way to make rationality more widely accepted, even by a tiny amount, then you would incrementally solve the "efficient charity" problem along with a host of others, including existential risk, lack of life-extension advocacy, etc etc.

But if you could find a way to make rationality more widely accepted, even by a tiny amount, then you would incrementally solve the "efficient charity" problem along with a host of others, including existential risk, lack of life-extension advocacy, etc etc.

Agree, but easier said than done :-).

Beware the fallacy of the drunkard who looks for his keys under the streetlight rather than in the alley where he dropped them, because "the light is better here"

Sure, I'm not saying that one shouldn't try. Several points here:

  1. My observation has been that there's a tendency for people with lower innate levels of rationality who are exposed to rationality to adopt "rationality as attire" analogous to Science As Attire. People can nominally become more rational without this having a deep impact on them, and this can give rise to an illusion that raising levels of rationality is easier than it actually is. I have limited data and the relative significance of this factor is unclear to me.

  2. I'd certainly be interested in brainstorming with you about ways to raise the global standard for rationality.

  3. Concerning easy accessible projects vs. difficult inaccessible projects: I think that as a heuristic younger people should aim for smaller successes to develop a credible track record to leverage toward later more ambitious goals.

ways to raise the global standard for rationality

I think that it might help if one could make rationality look more like a way to win and less like a cult(ure) of self-sacrifice and loserdom. This is a big problem have with LW: it generates Losers, not winners. Yes, generous losers who want to help others, but losers nontheless. An ideology that makes you into a loser (no matter how generous a loser) is going to sell like warm dog-poo.

Maybe it would be possible to turn a branch of rationality into a machine that outputs people who are "winners" according to a diverse set of already-acepted standards of winningness. I.e. not "how much has this person helped random strangers", rather "has this person got an expensive car" "has this person got an active social life", "has this person got a hot partner", "does this person give off signals of high-status" etc.

I think it's hard to even imagine rationality as popular because what we have here is so different from what could ever be popular.

Maybe there simply isn't a way for one to use epistemic rationality to generate winning people. Maybe the only way to reap any reward from rationality is to have a whole society simultaneously adopt it, producing an irrationality/collective-action-problem catch 22 which will be the end of us all.

( irrationality/collective-action-problem catch 22 = can't make anyone rational without solving important collective action problems, can't solve important collective action problems without most people being rational. Hence impasse, stupid, fail, die. )

An ideology that makes you into a loser (no matter how generous a loser) is going to sell like warm dog-poo.

Huh. This statement just seems wrong on its face. For example, Christianity is a fairly popular ideology, and it at least seems to "make you into a generous loser" in the sense you mean that here.

Possibly I don't understand Christianity properly... or maybe I don't understand what you mean here.

Or maybe there was an implicit "will sell like warm dog-poo [within the community we're talking about]" and I've lost track of context.

I mean, sure, I agree that if you're primarily concerned with people who primarily want expensive cars, showing how rationality leads to having expensive cars is definitely the way to go. (Ditto for social life, hot partners, status and so forth.)

This statement just seems wrong on its face.

It is and it isn't.

The intersection of ideology and identity is all about defining winners to include you. Most ideologies have someone to look down on for that exact reason- we're winners because we're not X. I recently started listening to country music quite a bit, and it is somewhat amazing the number of songs that profess a preference for being poorer/simpler/etc, but it makes perfect sense when you imagine it as them redefining success to exclude people that own mansions but don't have time to go to the fishin hole. (Side note: the rich people I know that like to fish regularly go fishing.)

And so it seems to me that LW's brand of "not only should you be an altruist, but you should be a particular kind of altruist that doesn't get warm fuzzies" will sell like warm dog poo, because that's only barely about rationality. Even standard rationality- the "I'm often wrong but I try to be less wrong"- only sells to the analog of theologians among the religious. Christianity works for both the people who want the social club and to look down on the unsaved and for the people who want personal growth (and to look down at those who don't get it). But generally speaking the first group is larger than the second group- and we only appeal to the second group.

Do people move from one group to the other? Yes, of course. (Unfortunately, it goes both ways.) Should we fret about how many people would be attracted to the stuff we do? Honestly, I don't see why. One could get some validation that other people like it, or some validation that other people don't like it. But rationality is fundamentally an individual thing and it should provide individual benefits. Turning it into a political or social movement introduces all the problems inherent with political or social movements- and it seems better to just live so well other people ask you what you're doing.

As far as I can tell, "rationalism" as a social movement actually does pretty well on the "people who want the social club and to look down on the unsaved" front among people who identify as smart (where the "unsaved" equivalent is "people not as smart as us"), and not so well among those who don't.

In any case: yeah, if one doesn't want to "sell" it in the first place, one's problems become simpler.

Christianity is a worthy counterexample. But note that in the developed world, it is massively in retreat, i.e. on a level playing field where christianity started today with the same number of initial members as LW has, it would die.

On the other hand something like scientology has actually suceeded in growing from a tiny base, so maybe that's a stronger counterexample. But note that scientology sells itself a lot on helping people with personal development, i.e. winning. As does christianity to some extent, especially brands of christianity that are actually succeeding in attracting new members.

In conclusion I think that succesful religions actually excel at offering the recruit some short-term gains in winningness. In the case of christianity at least, I think that the gains are permanent for many people.

Thinking about it, it seems that the need for a personal development focussed ideology is obviously very strong. I mean geez, if people need that so badly that they're prepared to believe utter bullshit in order to get it, then there must be a strong need for it.

(nods slowly) Yeah, you're right: I can't think of any "loser-making" ideologies that are growing in popularity compared to prosperity theology.

OK, I stand corrected, at least as applied to the modern world.

One problem, as has been discussed many times, is working out a delivery vehicle for "rationality as a way to get good stuff from the world" that doesn't have its lunch eaten by "the trappings of rationality as a way to get good stuff from gullible people."

To solve that problem in the context of personal development, we need short-term gains that swamp the placebo effects that hucksters offer.

Which is a tricky problem, because the placebo effects are actually pretty darned compelling: increasing confidence and subverting people's self-sabotage techniques really do get a lot of win right off the bat in the areas people normally think of for personal development (getting a raise, a better job, making friends, mood maintenance, weight loss, etc.).

My own instinct would be to start in a market where there isn't a strong established antirationalist competitor, that isn't primarily social (thus less readily swamped by the effects of charisma), and that is genuinely difficult (such that a good approach quickly generates noticeably better results than a poor one).

The one that jumps out at me is personal finance. A reliable rational technique for substantially outperforming the market in a 3-6 month timeframe would be a pretty good hook.

What do you mean by personal finance? You mean how to make money ?

"Personal finance" to me has meant "reliable tweaks to optimise current methods of making money". So, less make money, and more decrease waste of made money.

Not "How to get rich quick", but "How to be a little richer than you are"

How to make money, how to spend less than you make, how to get the stuff you want for less money, how to make reliable plans for having enough money in the future (e.g., "planning for retirement").

Yeah. Sounds like a good first target. Though note link to personal development, which itself links to social dev.

Hm. That raises an interesting potential point of differentiation, actually.

I've seen a lot of "make money" guides that spin themselves as personal development plans... "change your attitude, use these techniques, and you'll be powerful and successful and popular" and so forth.

Which is unsurprising; this is how one creates followers.

Taking instead the tactic of "Your attitude doesn't matter. Do these things, and you'll get positive results. We're talking about the reality outside your head, here." might help inhibit subversion by magical thinking.

I think that it might help if one could make rationality look more like a way to win and less like a cult(ure) of self-sacrifice and loserdom. This is a big problem have with LW: it generates Losers, not winners. Yes, generous losers who want to help others, but losers nontheless. An ideology that makes you into a loser (no matter how generous a loser) is going to sell like warm dog-poo.

Spot on! There is an awful lot of social pressure here that has absolutely nothing to do with behaving rationally - in fact, some of it is directly opposed.

"Rationality as attire" can actually win really well because it takes so little to do better than most people. There's a lot of low-hanging fruit.

  1. My observation has been that there's a tendency for people with lower innate levels of rationality who are exposed to rationality to adopt "rationality as attire" analogous to Science As Attire. People can nominally become more rational without this having a deep impact on them, and this can give rise to an illusion raising levels of rationality is easier than it actually is. I have limited data and the relative significance of this factor is unclear to me.

Guilty! ;)

people cannot tell them apart (if they could, they would definitely shift their contributions).

Also, we know much of the aid has been done with knowledge that it would cause harm, and designed to be stolen/abused, because it was being used as bribes for nasty regimes in geopolitical contests. That can provide a sizable chunk of the "negative" effect to balance out positives.

A hypothetical charity running programs like VillageReach's but which embezzled 95% of its budget at the cost of correspondingly greatly reduced the cost-effectiveness would still be doing far more good per dollar than the Make-A-Wish Foundation or the least effective developing world charities do.

This brings to mind the fate of The Chasers (Australian satirical comedians). Their 'Make a Realistic Wish Foundation' skit effectively scuttled them. It was in poor taste even in my judgement yet the reactions to it made it clear that the very thought of looking closely at just how useful such activities are is unthinkable. Because they are sick children!

A hypothetical charity running programs like VillageReach's but which embezzled 95% of its budget at the cost of correspondingly greatly reduced the cost-effectiveness would still be doing far more good per dollar than the Make-A-Wish Foundation or the least effective developing world charities do.

This is a good sentence (and would make a fine conclusion - I think generalised conclusions don't play on availability bias nearly enough) but there's a bit of a problem in the middle there.

Also: you have caused me to update my beliefs about how to evaluate charities, and also you have caused me to desire to donate more and more often.

This is a good sentence (and would make a fine conclusion - I think generalised conclusions don't play on availability bias nearly enough) but there's a bit of a problem in the middle there.

Thanks for the catch. [Edit: Fixed]

Also: you have caused me to update my beliefs about how to evaluate charities, and also you have caused me to desire to donate more and more often.

Interesting; good to know.

For those who have high earning potential and lack skills that are especially rare in the philanthropic world the most efficient way of helping people will typically be taking a high paying job and donating one's income to an efficient charity. Of course, many people who volunteer or forgo income to work at a non-profit do so not only with a view toward helping people but also because they want to experience the visceral sense of helping people directly or of working directly on a cause that they feel passionate about.

There's also the issue of doing no harm. I work in commercial litigation, at a "some-profit" job. My salary allows me a surplus to donate significant money to charity; I could instead choose to work at a "nonprofit job" and donate very little, or to work at a "for-profit" job and donate much more.

I chose the "some-profit job" over the non-profit job specifically because of the reasoning you cite -- I can probably do more good by donating the extra money than by being more helpful as a lawyer.

Why didn't I go all the way, and work at a for-profit job? Partly because I find the tasks and people associated with those firms obnoxious, but partly because they do a lot of harm and a lot of lying and a lot of cheating. Admittedly, if I were to shut up and multiply, I would still be saving net lives if I switched, at least if you only count the direct impact of what I do. But I don't feel comfortable limiting myself to direct impacts -- I do not know what the long-term, indirect impacts are of helping to perpetuate a system of lies and injustice and subtle economic oppression, nor do I know how to calculate them.

Advice is welcome, but please, tread carefully. Mere exhortations to "shut up and multiply anyway" are unlikely to move me.

I do not know what the long-term, indirect impacts are of helping to perpetuate a system of lies and injustice and subtle economic oppression, nor do I know how to calculate them.

Which part of the world do you work in? The USA? Western Europe?

If so, I would caution against assuming that the net impact of commercial lawyers is negative. Sure, lying and cheating. But probably less bad than no commercial law at all. And without commercial law, there would be no companies and no economy. The net impact of the economy, is, it seems, positive ;-0

I suspect that lying, cheating greed has a lot of negative emotional affect associated with it. By the time-honored rules of contamination of emotional affect to adjacent concepts, this must mean that the overall impact of commercial law is negative. But no, clearly it isn't, at least relative to the alternative of no commercial law. One must take care to only use emotions as evidence in domains where we have reason to believe that they are actually useful and accurate.

Also, remember that if you take a job in commercial law, you are not adding another commercial lawyer. You are merely replacing the person who would have got the job if you hadn't.

Thanks for your interesting comment.

I agree with Roko that commercial lawyers collectively do some good. Things are less clear at the margin. I know very little about the world of commercial law and you're probably in a better position to judge than I am. Still, two brains are better than one. We should talk in person - I'll be in San Francisco starting December 18th.

I find the tasks and people associated with those firms obnoxious

This seems like a potentially compelling reason for you to eschew a profit maximizing job as a lawyer even from an altruistic point of view. My observation has been that people tend to underestimate the difficulty of sustaining employment at a job that they find unpleasant.

We should talk in person - I'll be in San Francisco starting December 18th.

I'd like that.

Great post!

Your worked examples of Make-A-Wish, Nurse-Family Partnership, and VillageReach were terrifically presented. I think your style also helped you present points I tried to cover in my more broad piece more effectively here. I was aiming for a slightly different objective, so I think these two complement each other well now. I like how you discuss a more focused sub-section of what I cover, but in a more complete way than my quick, fragmented overviews ever could. In fact, your entire piece presents a better discussion of #2 (Identify a cause with lots of leverage) and #3 (Don’t confuse what “feels good” with what actually helps the most) from my piece and I love the discussion in "Volunteering, Nonprofit Work and Cost-Effectiveness" which is superior to my condensed point #7 (Give money).

And since I like your piece so much, I've removed an SIAI-specific link from the #2 heading of my piece to link directly here now. Anyone directed to my post in the future would be well served and more informed by reading your excellent discussion as well.

Thank you for contributing towards this! Some hopefully constructive criticism:

  • The idea of comparing two charities together to see how different the good done by them is a good one.
  • Your Comparison ... section seems a bit long and I think it could be condensed substantially. The description of MakeAWish seems a bit lengthy. The Nurse Family Partnership comparison doesn't seem that compelling. Your citation of a paper that there's a 1000:1 effectiveness difference between many charities is dramatic; put that near the beginning!
  • I think you can move many sentences describing where your data came from to footnotes. Short articles are good! Wordy articles scare people away.
  • I'd say that picking out a good charity is substantially more difficult than picking a good investment. In finance, there's good reason to believe that an arbitrary asset will not be a terrible investment (efficient markets) while in charity there is currently no corresponding reason to think that an arbitrary charity will not be terrible.

The lack of the efficient market assumption is very important.

Another implication of "no efficient markets in charity" is that you should look for absolute advantage rather than comparative advantage. E.g. even if you have a lot of experience with, say, looking after children, you should not get involved with childrens' charities, you should go make money and give it to the most efficient charity (probably existential risks).

Your Comparison ... section seems a bit long and I think it could be condensed substantially. The description of MakeAWish seems a bit lengthy.

What in particular would you suggest cutting out?

The Nurse Family Partnership comparison doesn't seem that compelling

Well, it was added to address Roko's suggestion. I personally think that it should be compelling; the tradeoff is between a single good experience and something of potentially lifelong value. In any case, I don't have a better U.S. example :-).

Your citation of a paper that there's a 1000:1 effectiveness difference between many charities is dramatic; put that near the beginning!

I thought about this and couldn't think of how to do it without disrupting the flow of the essay.

I think you can move many sentences describing where your data came from to footnotes.

Did some of this above in response to your suggestion.

Short articles are good! Wordy articles scare people away.

Yes, this is my impression as well. My natural style pushes in the direction of lengthy articles; there are people who are better suited than I am to writing shorter articles.

One way to shorten the present article would be to delete the section about volunteering and nonprofit work which is independent of the rest of the article and makes it more complex/less digestable. I included it to meet the guidelines that Roko had set but for a short article maybe it's best to focus on charitable giving proper.

I'd say that picking out a good charity is substantially more difficult than picking a good investment. In finance, there's good reason to believe that an arbitrary asset will not be a terrible investment (efficient markets) while in charity there is currently no corresponding reason to think that an arbitrary charity will not be terrible.

Agree, but in view of the fact that the audience may be unfamiliar with economics could not think of how to address this explicitly with enough context so that the audience finds the point compelling without further lengthening the article and diluting the main intended messages.

If you send me a word document of this post I could edit it how I would edit it (to some extent) or if you are familiar with a text diff program, I can send you an original /edited file

Sent a .odt file to your email. More detail feedback welcome but feel no obligation.

Thank you for contributing towards this! Some hopefully constructive criticism:

Thanks; I will consider these and revise accordingly.

Thanks for this post. I never thought about the overhead ratio like that before, it looks like I'll be reevaluating the charities I support.