Our Top Charities for the 2012 Giving Season

Over the past year, we’ve continued to follow and investigate our existing top charities, and we’ve also looked for more outstanding giving opportunities. Today we are announcing our updated top charities:

1. Against Malaria Foundation (AMF). AMF focuses on distribution of insecticide-treated nets to prevent malaria; of all the charitable interventions we know of that have clear room for more funding, this one has the strongest evidence of effectiveness and cost-effectiveness. AMF has outstanding self-evaluation and transparency. It first became our #1 charity in late 2011 and has continued to impress us.

2. GiveDirectly. GiveDirectly’s goal: for every $1 it spends, deliver $0.90 directly into the hands of extremely poor people in the developing world, with no strings attached. We first wrote about GiveDirectly in 2011 when it was just getting off the ground, and we now have enough information from its first year to believe that it is succeeding in this goal, and is an outstanding young organization with extremely strong self-evaluation and transparency.

Our definition of “evidence of impact” includes evidence that “wealth is being transferred to low-income people.” We feel that direct cash transfers face an unusually low burden of proof because the link is so tight between cash transfers and giving additional wealth (and choice/empowerment) to recipients. That said, cash transfers have been more heavily studied than any other non-health intervention we know of. The evidence says that they increase short-term consumption, especially of food, and there is suggestive evidence that they may be invested at very high financial rates of return (e.g. ~20% per year). We are not as confident in the investment returns as we are in the evidence for some other interventions, especially bednets, but we believe that the case for increasing consumption on its own terms is strong. The many high-quality studies on cash transfers also provide little support for common concerns about such transfers (such as the idea that they are spent mostly on alcohol).

Different donors will come to different conclusions on the value of this outcome (directly increasing recipients’ wealth) as compared to health interventions, and cash has some salient strengths (putting choice in the hands of recipients) and weaknesses (potential harms if it is poorly spent) relative to health interventions. For our part, we would guess that our other two top charities’ interventions (taken in isolation from the organizations delivering them) do more good on a per-dollar basis, but we are not confident in this, and we see a strong case for supporting GiveDirectly.

3. Schistosomiasis Control Initiative (SCI). SCI focuses on deworming: treating people for parasitic infections. Deworming is extremely inexpensive (~$0.50 per person treated, including all costs), and there is evidence linking it with substantial developmental benefits (people dewormed in childhood may attend school more and earn more later in life); the evidence is not as strong as for insecticide-treated nets but is still far above what we’ve seen for most charitable interventions. We have at times struggled to understand SCI’s activities and impact, and are not as confident in the organization as a whole as in AMF and GiveDirectly, but overall it is an organization with an impressive track record and a strong commitment to transparency, and we consider it an outstanding giving opportunity.

We have published updated reviews of all three charities, as well as audio and a transcript from a conference call we did last week, at which we discussed our preliminary thinking about how to rank these charities with a group of especially involved GiveWell followers. We also give some initial thoughts in this post on the relative strengths and weaknesses of the three charities.

We plan to publish substantial additional content in the coming weeks that will give more context for the thinking behind our rankings. This will include updated reports on insecticide-treated nets, deworming and cash transfers, and blog posts going into more detail on how we see the major considerations (in particular, how the different interventions compare on cost-effectiveness and how we respond to common objections/concerns regarding cash transfers).

This year, more than in past years, our top charities have very different strengths and weaknesses, and we see substantial room for individual donors’ judgment calls in how much to give to each. We encourage donors to read on and review our take on this question. The rest of this post will (a) discuss what we’ve done over the last year that has led us to our current rankings; (b) lay out what we see as the major considerations regarding which of the above three charities to give to.

Our work over the past year

Over the past year, we’ve done the following:

  • Continued to follow AMF and SCI, which were our top two charities as of December 2011. We published the following updates:

    Both made progress and continued to be highly transparent. We had an easier time understanding AMF’s activities (and the impact of GiveWell-sourced donations) than understanding SCI’s activities.

  • Continued to investigate key questions about insecticide-treated nets and deworming.
    • Regarding insecticide-treated nets, we did a major internal vetting of our work and published a post revisiting the cost-effectiveness of this intervention; we also wrote about the possibility of insecticide resistance. Our big-picture stance on this intervention has not changed much – we still consider it an intervention with outstanding evidence of effectiveness and cost-effectiveness – though we have noted some new concerns and caveats.
    • Regarding deworming, we published a post about a new systematic review of the evidence on deworming’s benefits, and we have a post forthcoming revisiting one of the major studies arguing that deworming has developmental benefits (i.e., that it leads to better outcomes later in life). We now find the short-term case for deworming’s health benefits to be weaker than we found it to be in 2011, and we find the long-term case for its developmental benefits to be stronger.
  • Kept tabs on other promising organizations and did a thorough investigation of GiveDirectly. We have considered GiveDirectly promising since its launch, but only recently did we feel that it had enough of a track record to facilitate a deep assessment. In early October of this year, we determined that it was the most promising contender for a top-charity slot (aside from AMF and SCI); we completed a thorough investigation including multiple rounds of reviewing documents and interviewing its CEO; a more thorough investigation of the academic literature on cash transfers (writeup forthcoming); and a multiple-day visit to see GiveDirectly’s operations in Kenya.
  • Looked for other outstanding giving opportunities in the area of global health and nutrition. As discussed earlier this year, we focused on finding ways to deliver the most promising interventions, rather than repeating our earlier approach of scanning a large list of charities. The two most promising interventions we looked into, immunizations and salt iodization, do not appear to have the sort of room for more funding that our top charities do (i.e., we do not see opportunities to translate additional dollars directly into additional people reached). We will be writing more about this in the future.

How much should you give to each charity?

We don’t believe in “diversifying” donations to charity, for the sake of “reducing risk” – we believe in giving in order to maximize the “expected total good accomplished,” which – by default – means finding the best giving opportunity and allocating it 100% of one’s charitable dollars. However, we do see legitimate reasons to divide one’s donation:

  • If you are giving a large enough amount of money, it’s possible to hit diminishing returns by giving it all to one charity. A simple example is that if I were giving $1 billion this year, I wouldn’t give it all to AMF, because that amount would well exceed AMF’s room for more funding.
  • A more subtle version of this idea pertains to learning opportunities. In a sense GiveWell is like a “large donor” with a few million dollars of anticipated money moved. If we direct major funding to more than one charity, we will have improved access to each such charity and will have improved opportunities to track its progress and learn from it. In addition, though we don’t anticipate moving enough money to overwhelm any of the three charities’ room for more funding, there is an argument that each marginal dollar means less to the charity in terms of improving its prominence, ability to experiment and plan, probability of turning out not to be able to scale further, etc.
  • For donors who think of themselves as giving not only to help the charity in question but to help GiveWell, we encourage allocating your dollars in the same way that you would ideally like to see the broader GiveWell community allocate its dollars. If every GiveWell follower follows this principle, we’ll end up with an overall allocation that reflects a weighted average of followers’ opinions of the appropriate allocation. (By contrast, if every GiveWell follower reasons “My personal donation won’t hit diminishing returns, so I’ll just give exclusively to my top choice,” the overall allocation is more likely to end up “distorted.”)

We’ve polled GiveWell staff and core supporters on how they plan to allocate their own funds, and after considering these subjectively, we have settled on a recommended allocation of 70% to AMF, 20% to GiveDirectly, and 10% to SCI. However, we believe there is substantial room for judgment calls and value disagreements here, and we expect to see many individuals deviate significantly from this allocation due to their judgment calls and values. Our rough picture of the judgment calls and value choices that matter most is as follows.

Program Program evidence Program cost-effectiveness Our confidence in the organization Potential for innovation /upside
Against Malaria Foundation Malaria control Very strong Very strong Very high High
Schisto-somiasis Control Initiative Deworming (treating parasitic infections) Fairly strong Highly uncertain, though may be strongest High Low
Give Directly Direct cash transfers to the very poor Strong on short-term consumption; moderate on investment Highly uncertain; may be strong Very high Very high

For donors who place high value on supporting strong overall organizations (in light of the fact that much of the impact of a donation depends on who’s in charge of allocating it), and/or promoting innovation and experimentation, we suggest a relatively higher allocation to GiveDirectly, and lower to SCI.

  • We believe that GiveDirectly has significant “upside”: it is experimenting with a type of intervention that is extremely rare in the nonprofit world, that it is hoping to experiment with many different approaches to this intervention, and that its approach may ultimately evolve and change significantly and may have a major impact on other parts of the nonprofit world.
  • We believe AMF has significant “upside” as well, though in a different way (and probably to a lesser extent than GiveDirectly). Its intervention is one that has a large community around it and a lot of funding behind it. Through its unusual degree of transparency and self-evaluation, AMF may set examples for others and/or produce information/insights that are helpful to the broader malaria control community.
  • While SCI is an outstanding organization, we do not believe it is as strong as the other two on this criterion.

For donors who are particularly “harm-averse” – such that they place significant weight on the “do no harm” principle as opposed to the “maximize expected good accomplished” principle (we subscribe to the latter) – we suggest a relatively lower allocation to GiveDirectly. Cash transfers (particularly as GiveDirectly structures them) have a higher risk of unintended consequences than the other two interventions. We see very little risk of harm for insecticide-treated nets or deworming.

For donors seeking to save rather than improve lives, we suggest a relatively higher allocation to AMF, the only charity of the three whose intervention has been linked with reduced mortality. For donors seeking to improve rather than save lives, we believe AMF should still get the highest allocation overall–the benefits of reducing the burden of malaria likely go well beyond saving lives. (GiveWell staff tend to prefer improving lives over saving them, and our suggested allocation takes this into account.)

For donors who are inclined to be less skeptical than we are of academic evidence and cost-effectiveness analysis, we suggest a relatively higher allocation to SCI, and lower to GiveDirectly. If one takes the evidence on deworming at face value, it indicates extremely impressive long-term benefits. Similar benefits may exist for reducing the burden of malaria, but deworming is substantially cheaper (~$0.50 per person per year, as opposed to ~$1.25) on a per-person basis.

For donors who are more skeptical than we are of academic evidence and cost-effectiveness analysis, and place a higher weight on the reasoning that “people are likely to make better decisions for themselves than we can make for them,” we recommend a relatively higher allocation to GiveDirectly.

We’ll be very interested to see what people end up doing. We encourage donors to post their planned allocations, and reasoning, as comments (or to email us if they’d prefer that their thinking stay private).

Comments

Our Top Charities for the 2012 Giving Season — 14 Comments

  1. Thanks very much for the update. You forgot to mention tax deductions as a contributing factor in decision-making – I think I will go 100% with AMF to get the full UK tax deduction, though I would have liked to have given something through GiveDirectly.

  2. I notice that you have dropped the “standout” charities from your recommendation list (last year, this included IPA, KIPP Houston, Nyaya, Pratham, and SEF). Can you elaborate about your motivations for this decision?

  3. “we have settled on a recommended allocation of 70% to AMF, 20% to GiveDirectly, and 10% to SCI.”

    Why? If AMF is better than GiveDirectly and SCI, why not donate everything to it? If they’re the same, why would it matter?

    Do you figure that you control enough of the donations that your reccommendation will mean that, for example, all of us donating to AMF would be enough that GiveDirectly would be better?

  4. Daniel Carrier, that is explained in the paragraphs just before your excerpted quote. To give my paraphrase/take on it: as donors we may want to both help people by donating to the charity with the highest expected impact, and also help GiveWell so that they can make better-informed (and maybe better) recommendations in the future. If we all give some fraction of our donated dollars to the #2 and #3 recommendations, then a) those charities in particular may be more willing to work closely will GiveWell, sharing data etc., and b) perhaps other charities will be more inclined to share information with GiveWell, since even a non-top recommendation would lead to a sizeable amount of donations given to them.

    As for me, my instinctive reaction (which I’ll qualify below) is that I want something like an 80/20 split between AMF and SCI. I am unashamedly paternalistic when it comes to health matters (especially, but not exclusively, for potentially fatal diseases). Even at highly subsidised prices, bednet take-up is much lower than with free distribution; it is possible to find revealed-preference estimates for the value of a statistical life of less than $1000; I value lives much higher.

    So while I recognise the long-term advantages to GiveWell having more access to charities, and will therefore send some of my donations to SCI, I’d also like to nudge GiveWell away from the cash transfers, and therefore I’m not likely to donate to GiveDirectly.

    But now the qualifications. I could be wrong to be so paternalistic, I could be underestimating the potential impact of the cash transfers, and I could be underestimating the long-term advantages to GiveWell of having all of their recommended charities get a decent amount of funding moved via GiveWell. So I’m open to persuasion.

  5. 50/40/10 AMF/SCI/GD.
    I’m fairly confident in GiveWell’s ability to assess the academic literature and data on health interventions. I’m not so confident in GiveWell’s ability to assess people and “potential for innovation upside,” because I myself am not confident in my ability to assess these things, which may prevent me from distinguishing between good and bad assessors (just like how idiots can’t tell the difference between smart and really smart people without outside cues).
    I also believe the ultra-poor have too-high discount rates, so I suspect much of the money GiveDirectly disburses will have limited long-term effects. I have not seen much in GiveWell’s write-up that alters my belief.
    I was going to give zero or a token amount to GiveDirectly, but I opted to follow GiveWell’s advice to allocate “dollars in the same way that [I] would ideally like to see the broader GiveWell community allocate its dollars.”

  6. Thanks for the comments, everyone.

    Lee: Thanks for the reminder about tax considerations. We discussed them in the immediately preceding post, but I agree that they were worth mentioning again.

    Ian: Basically, we’re capacity-constrained and felt that it was better to focus our research time on the most promising organizations we could find, rather than spreading ourselves thinner in order to update our reviews of standout organizations. We discussed this issue at greater length during our November 20th conference call (DOC).

    Daniel: David mostly hits the nail on the head, but I would add a note about the possibility of nonlinear upside. I find it plausible, if not overwhelmingly likely, that supporting GiveDirectly could help promote the “cash as charity benchmark” norm that I believe would be enormously socially valuable. If that’s the case, then moving GiveDirectly enough money to signal support by donors could be significantly more cost-effective than marginal AMF donations. (There’s a similar dynamic at play with GiveDirectly the organization, which we also believe has significant upside and is especially likely to benefit from flexible donations at this stage in its evolution.) In the absence of the learning benefits that David identified and these type of organizational and general equilibrium considerations, we agree that it would be optimal to focus donations on a single highest-expected-value charity until its room for more funding was eliminated (or substantial declining marginal returns come into play). As it stands, it strikes me as plausible that the highest-return giving opportunity of our recommendations is the first million dollars to GiveDirectly, but that above that level AMF has the highest expected return. (This is my personal take; other staff members may not agree on this point.) We’ve made our recommended allocation across charities in order to try to coordinate that across donors (i.e. so the total pool is allocated as well as possible), but we also see value in the potential for donors to disagree with us, and make their allocation as they see fit.

    David: The reply to Daniel is relevant to your point, but I’d also suggest that cash transfers are most likely not just subsidizing consumption, and that therefore the comparison between revealed-preference values of a life and your moral estimate need to be adjusted for potential investment returns to cash transfers (see our very brief discussion here; more thorough analysis forthcoming soon). Of course, bednets also have unquantified economic benefits that affect the calculation, so I believe that, given my values, it’s likely that bednets are a better bet. The one other useful consideration to keep in mind, though, is the real possibility that our cost-effectiveness estimates are deeply mistaken. At a cost-per-life saved an order of magnitude higher than we estimate for AMF, I would find it easy to fund cash transfers rather than bednets, and so if I were most skeptical of our cost-effectiveness estimates, cash would become a viable alternative.

    All of that said, I think your conclusion is perfectly reasonable, and would be happy for you to follow the allocation you’ve laid out.

    Sam: Thanks for sharing. We’re planning to write more about the potential investment returns of cash transfers, but would you mind saying something about your relatively high SCI allocation (vs AMF)?

  7. Sure. It’s really just an extension of the same reason why I underweighted GiveDirectly: I’m not as confident in GiveWell’s ability to assess people and “potential for innovation.” I think GiveWell probably overrates charities that give it a lot of access and influence (what is GiveWell’s record in improving charities?).

    I don’t think the “cash as charity” benchmark has much of a chance taking root. Most people give to make themselves feel better and further a pet cause, so the reasoning of benchmarking is lost on them. Most charities will not compare themselves to that benchmark because it would suggest they kill themselves and give their assets to causes that can beat the benchmark.

  8. I’m glad to see that GiveDirectly is making progress. Based on what I know so far, I plan to keep my monthly donation to AMF unchanged, but will probably add a smaller recurring donation to GD as well, once I see the full writeup on unconditional cash transfers. (I hope it includes some comparison with conditional cash transfers, as those programs are more widespread and seem to have broader credibility.)

  9. I have been fortunate to know the leadership and staff of SCI since its inception. It is an incredibly dedicated and committed group of scientists and public health experts – together they are making an enormous difference in the life of the poorest people living in sub-Saharan Africa and elsewhere, ensuring the even the most destitute have a fundamental right of access to essential medicines for neglected tropical diseases. Literally, tens of millions of people benefit daily from the activities of SCI and I cannot say enough about the importance of the work and of course the incredible cost-effectiveness of mass drug administration for intestinal helminth infections and schistosomiasis!

  10. The high ranking of GiveDirectly surprised me. While I accept that GiveWell’s assertion that cash transfers have “an unusually low burden of proof” for doing good, that doesn’t imply that they do more good than any other form of aid (except that from AMF).

    From the notes I saw on GiveWell’s website, it appears that most of the money seems to be spent on short-term consumption (food), household durables (tin roofs), and investments (livestock and motorcycle taxis). In my mind, investments is the only one that stands out having a lot of potential for significant long-term improvement in the quality of life, but only if they have high rates of return. However, there may already be an opportunity for high-return investments to get financed without GiveDirectly where microcredit exists. Further, because GiveDirectly is giving based on income levels rather than business opportunities, I have additional doubts that investments with high rates of return are common uses of the cash transfers. I may be wrong, but it appears that we don’t have hard evidence one way or the other.

    There is emerging research on how people in extreme poverty spend their money, much of which points in the direction of a certain amount of paternalism for aid. For example, the book “Poor Economics” (which I highly recommend) describes various cultural and behavioral reasons why farmers in the third world often don’t buy fertilizer, even when they agree that the higher crop yield is sufficient to cover the fertilizer cost. The issue is that various factors cause them to spend the profits from the improved harvest before the beginning of the next planting season, so the farms don’t have enough money to purchase more fertilizer when it is needed. This is one of many examples in the book about the spending patterns of the poor (most of which are supported by evidence from RCTs) that give me less confidence about the impact of GiveDirectly. In order to donate to them, I’d need to see more evidence of compelling long-term impacts that compare favorably to other giving opportunities.

    I suspect that the underlying issue is that GiveWell is simply not finding many charities that are evaluating their results with enough rigor to compete for GiveWell’s top recommendations. As a result, GiveWell is now giving a high rating to a very new, unproven organization that is in the process of doing a rigorous evaluation. I’m interested if GiveWell would consider this an accurate assessment. If so, what are your thoughts on offering restricted grants to fund rigorous, third party evaluations for other potentially promising organizations?

  11. I have worked for over 40 years in both basic science and public health related to parasitic diseases, and schistosomiasis in particular. I have been been privileged to have seen the beginnings of the Schistosomiasis Control Initiative and to watch it grow as an extremely important leader in the fight against neglected tropical diseases, especially worm infections that burden hundreds of millions of children by impacting their development and well being. SCI is an extremely well managed charity that focuses its efforts to make a more meaningful impact. It does this admirably with an extremely dedicated staff. I believe it is one of the most focused and effective groups with which I am familiar and I support it and what it does to the fullest.

  12. Thanks again for the replies, all.

    Dr Hotez and Dr Colley: thanks for sharing your support for SCI; we appreciate the input. We also feel that SCI is an outstanding organization.

    Scott: we’re planning to publish our updated cash transfer review soon, and it does discuss the comparison between conditional and unconditional cash transfers, but that has not been a central question for us, since we are not aware of any charities exclusively doing conditional cash transfers. The many studies of conditional cash transfers have generally been of government programs that donors may not be able to directly fund.

    Eric: We would guess that cash transfers as an intervention are less cost-effective than bednets or deworming, but we see considerable grounds for disagreement on this issue. As we try to communicate in the table above, our recommendation of GiveDirectly is meant to encompass other considerations beyond just the cost-effectiveness of the intervention (e.g. our perception of the strength of the organization and the potential for upside) in order to get to an all around best guess at how much good-per-dollar donations will do. We think that the evidence for high returns on investment from cash transfers is surprisingly strong; we’re planning to write more about that and the comparison to microfinance shortly.

    I wouldn’t agree with the characterization that “GiveWell is simply not finding many charities that are evaluating their results with enough rigor to compete for GiveWell’s top recommendations.” While there is certainly an element of that, I would place more emphasis on a lack of “room for more funding” in many proven, cost-effective interventions. This is actually good news, in that it suggests that the “charitable marketplace” is more effective at allocating capital than we had previously thought, but it makes it more difficult to find excellent underfunded opportunities. We’re also planning to write more about this.

  13. Greetings,

    I do appreciate the open forum that Give Well created for interested persons to share their ideas.

    My question to blog is, “Whose voice is it?”

    I hope that any charity or philanthropic effort would be a mutual learning (w/out power dynamics) experience.

    Saludos,
    Pete

  14. I’m glad someones doing an investigation on some of these organizations. Some are so slimey it’s disgusting. They come off like they’re doing so much good to the world, and they aren’t.