Comments on: Philanthropedia’s report on microfinance

by: Holden

Wed, 06 Jan 2010 00:06:38 +0000

Gordon, we feel that the answer to the “narrow question” you raise is heavily dependent on the attitude toward the “macro question.” Our stance on microfinance is a case in point. We feel that the sector as a whole has major problems, so we encourage donors to go in unconventional directions like directly funding the small, non-US-registered Small Enterprise Foundation. By contrast, a group of insiders within the U.S. microfinance charity circuit would be expected to point toward the current “big names” in the field (as appears to have happened).

by: Deyan Vitanov

Mon, 04 Jan 2010 18:18:45 +0000

I have now posted the second part of my response here: http://blog.myphilanthropedia.org. Sorry for the slight delay!

Ingvild, thank you for sharing your perspective. I personally disagree with it, because keeping the research results private would promote the wrong incentives (especially in helping us improve as well as the other elements that I wrote about in my response). I invite you to share specific criticisms or suggestions for improvement too!

by: Ingvild Bjornvold

Mon, 04 Jan 2010 16:12:20 +0000

When I first took a look at Philanthropedia’s web site a few months ago, I had questions that reflect all the concerns you are outlining. Who are the exerts? What is their methodology? Why so little focus on outcomes despite Philanthropedia’s expressed aim to evaluate “effectiveness” and “nonprofit impact?”

I have read Philanthropedia’s response (part 1), and although I like the idea of Philanthropedia and understand the project is evolving, I tend to agree with Holden that sharing the content seems premature. The foundation for the recommendations is just too unclear for donors to make informed decisions.

by: Deyan Vitanov

Sun, 03 Jan 2010 03:01:57 +0000

Holden, thank you again for taking a look at microfinance, I find the report to be very interesting and insightful. I have posted the first part of my response here: http://blog.myphilanthropedia.org/?p=41. I will be adding more specific comments in Part 2 tomorrow. I look forward to hearing your thoughts and continuing the discussion!

Gordon, you are making a good point. My personal opinion is that we have a responsibility to inform donors about the status quo in different social causes. That’s why in the future I envision adding more information, perhaps a page, for each social cause that can educate the donor on the important issues. I touch on this in Part 2 (which is not yet published).

Thanks all for the comments, keep them coming, I look forward to learning more!

Deyan

by: Gordon Strause

Sat, 02 Jan 2010 22:50:37 +0000

Good post.

I am big believer in the potential of Philanthropedia, but you really nailed the concerns about their model that I have. And the “reinforcing bad incentives” section made points that I hadn’t considered before but should have.

That said, I’m not sure the microfinance section of your critique is that on point in that I don’t think Philanthropedia is trying to answer the question of whether a “sector” as a whole is having an impact, whether that sector is “microfinance”, “climate change”, or the other sectors they cover. Instead, they’re answering a narrower question: “I want to give in a certain area: which non-profits in that sector are doing the best work”.

And while I think it’s vitally important that someone, whether it is GiveWell or others, explore the macro question of whether the sector as a whole is having an impact, I don’t think it’s illegitimate for Philanthropedia not to address that issue. In fact, given their model, I think they are right to leave it alone and focus just on identifying the tops orgs in different fields. It’s what their model is good for.