The GiveWell Blog

All Cost-effectiveness analysis Posts

The fungibility question: How does GiveWell’s funding affect other funders?

| by Jeremy Rehwaldt

How do GiveWell’s funding decisions influence the actions of governments, funders, and other organizations? Answering this question is an important part of figuring out which global health programs are most cost-effective and thus which we should support. We’ve already written about two key factors in our cost-effectiveness estimates: the cost per person reached and the overall burden. But those are only part of the equation.

We also consider what others are likely to do in response to our choices. For example, does our funding displace money the local government had planned to allocate to the program? Or would our funding make other funders more excited to join us in making sure the program is implemented?

Wedding registries provide a loose analogy about how one person’s decision might influence another’s: If someone already bought the toaster on the list, you’re probably not going to buy the lucky couple another one. The money that great-aunt Sally spent on the toaster has displaced the funding you had planned to allocate to the toaster: this is what we call “fungibility.”

In contrast, if the spouses-to-be have signed up for flatware service for 12 and only 6 settings have been purchased, you might prioritize filling out the remainder of the set, to be sure that the couple doesn’t run out of spoons at their upcoming dinner parties. In that case, the guests who purchased the first 6 settings can “crowd in” funding from other guests: this is what we call “leverage.”

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The hardest part about fundraising for GiveWell

| by Maggie Lloydhauser

May marked my three-year anniversary as a Philanthropy Advisor at GiveWell. It’s a job I adore (as I’ve written about here and here), and I’ve recently been tasked with the exciting process of interviewing candidates for our growing team.

One of the best questions I’ve been asked in this process is: What’s the hardest part about fundraising for GiveWell? The short answer: GiveWell is funding constrained, but we can’t point at a specific opportunity and say, “If you donate now, here’s the impact your donation will actually cause.”

Instead, our answer is fairly abstract, and pretty far from traditional fundraising language. We tell donors that we would spend additional money on opportunities at or above our cost-effectiveness bar (which translates to saving a life for about $5,000), but we’re unable to explain in advance precisely what we will allocate additional funds to. That answer isn’t as compelling as telling someone a vivid story about how their money alone would allow us to fund a great program we’ll otherwise have to decline, but it has the advantage of being completely accurate and true.

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Consider the eggplant

(updated on: ) | by Chandler Brotak

Norman Borlaug, the “father of the green revolution,” transformed agriculture (and won a Nobel Peace Prize) for developing new wheat varietals that resisted diseases and greatly increased yields.

You might well wonder: if it’s possible for wheat, is it possible for other crops? Consider the eggplant: a popular purple fruit/vegetable that can be made into everything from hongshao qiezi to baba ghanoush. It’s beloved by many people worldwide, and also by a cute but destructive moth larva.

The “eggplant fruit and shoot borer,” as the name suggests, bores into the shoots and fruit of eggplants, damaging the crops. A new varietal, Bt eggplants, was developed by the Maharashtra Hybrid Seed Company (Mahyco), and later supported by partnerships with USAID, Cornell University, and local partners. This varietal is genetically modified to create proteins which are toxic to these little menaces, but safe for humans and the environment.

So: could encouraging the adoption of Bt eggplants create a purple revolution that meets GiveWell’s bar for outstanding programs?

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How we work, #3: Our analyses involve judgment calls

(updated on: ) | by Isabel Arjmand

This post is the third in a multi-part series, covering how GiveWell works and what we fund. Through these posts, we hope to give a better understanding of our research and decision-making.

Our goal is to recommend funding to the programs we believe have the greatest impact per dollar donated. There’s no simple algorithm for this question. Answering it necessarily involves making judgment calls. Our first post in this series discussed the importance of cost-effectiveness analyses and the many factors we consider; in this post, we’ll share:

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GiveWell’s 2023 recommendations to donors

| by Isabel Arjmand

We’re excited about the impact donors can have by supporting our All Grants Fund and our Top Charities Fund. For donors who want to support the programs we’re most confident in, we recommend the Top Charities Fund, which is allocated among our four top charities. For donors with a higher degree of trust in GiveWell and willingness to take on more risk, our top recommendation is the All Grants Fund, which goes to a wider range of opportunities and may have higher impact per dollar. Read more about the options for giving below. We estimate that donations to the programs we recommend can save a life for roughly $5,000 on average, or have similarly strong impact by increasing incomes or preventing suffering.

Why your support matters

We expect to find more outstanding giving opportunities than we can fully fund unless our community of supporters substantially increases its giving. Figures like $5,000 per life saved are rough estimates; while we spend thousands of hours on our cost-effectiveness analyses, they’re still inherently uncertain. But the bottom line is that we think donors have the opportunity to do a huge amount of good by supporting the programs we recommend.

For a concrete sense of what a donation can do, let’s focus briefly on seasonal malaria chemoprevention (SMC), which involves distributing preventive medication to young children.

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How we work, #2: We look at specific opportunities, not just general interventions

(updated on: ) | by Isabel Arjmand

This post is the second in a multi-part series, covering how GiveWell works and what we fund. The first post, on cost-effectiveness, is here. Through these posts, we hope to give a better understanding of our research and decision-making.

Looking forward, not just backward

When we consider recommending funding, we don’t just want to know whether a program has generally been cost-effective in the past—we want to know how additional funding would be used.

People sometimes think of GiveWell as recommending entire programs or organizations. This was more accurate in GiveWell’s early days, but now we tend to narrow in on specific opportunities. Rather than asking whether it is cost-effective to deliver long-lasting insecticide-treated nets in general, we ask more specific questions, such as whether it is cost-effective to fund net distributions in 2023 in the Nigerian states of Benue, Plateau, and Zamfara, given the local burden of malaria and the costs of delivering nets in those states.

Geographic factors affecting cost-effectiveness

The same program can vary widely in cost-effectiveness across locations. The burden of a disease in a particular place is often a key factor in determining overall cost-effectiveness. All else equal, it’s much more impactful to deliver vitamin A supplements in areas with high rates of vitamin A deficiency than in areas where almost everyone consumes sufficient vitamin A as part of their diet. Similarly, one of our top charities, New Incentives, has chosen to operate in northern Nigeria largely because relatively low baseline vaccination rates mean its work is especially impactful there.

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