The GiveWell Blog

A conversation with a donor interested in obstetric fistula

(updated on: ) | by Elie

Jeremy, a teacher, recently emailed us because he was interested in supporting charities that work on the problem of obstetric fistula. Fistula is a cause that I’ve written about before and is one that, emotionally, is extremely compelling.

I thought the email exchange with Jeremy was informative, so (with his permission) we’ve posted it here.

In brief, I think it provides:

  1. A reasonable template for a donor thinking about supporting an organization that provides surgical care
  2. An example of how a donor can care deeply about a specific cause and have an initial feeling about the best organization to give to but then benefit from thinking critically about his or her giving decision.

Donating to Gates – against its will

(updated on: ) | by Holden

With all the people and organizations out there who would like more money, there’s something remarkable about the fact that the Gates Foundation is specifically asking people NOT to give to it (PDF) – and still couldn’t keep away over $10 million in donations in 2008.

Why the Gates Foundation doesn’t want your money

First off, I have a lot of trouble understanding the Foundation’s stated reasoning (PDF):

From time to time, people generously offer to contribute money to the foundation. We prefer that people give directly to our grantee organizations rather than to the foundation if they want to help advance the causes we’re passionate about. We have the stable funds we need to help us fulfill our mission, but our grantees often do not.

It seems to me that there are a couple of problems here.

  • Is it desirable that the Gates Foundation’s grantees should have more “stable funds” than they do now? If so, why doesn’t the Gates Foundation give them these “stable funds” in the form of unrestricted grants? Couldn’t it, at the very least, use its “extra money” (the money that comes in as individual donations) in this way?

    How does it make sense for the Foundation to ask people to fund something that that they choose not to fund themselves? More broadly, how does it make sense for an organization to that exists for the sole purpose of giving away money as well as possible to be discouraging people from giving to it?

  • The Foundation directs people to its list of grantees – in the form of a database of (currently) over 5,000 grants. How is an individual donor to cut through this information and figure out the best fit?

Speaking as someone who personally tried to do exactly this about 3 years ago, I can tell you that the information the Gates Foundation is providing is nowhere near sufficient to figure out which nonprofits would most benefit from my donation. I’m honestly surprised that the Gates Foundation is pointing people to pages like this one (and the other pages it links to) for information. The Gates Foundation has a large and well-credentialed staff devoted to researching where to give out money, yet they’re asking individuals to make the decisions themselves based on profiles that read like fundraising brochures?

The bottom line is that I don’t think the Gates Foundation makes a compelling argument that you shouldn’t give to it (so perhaps it’s not surprising that so many people have chosen to). To me, the strongest part of its case is the implication that it actually considers pages like this one to provide all the information and analysis a donor needs. If that were the case (and I doubt that it is), I’d definitely prefer to use my own judgment.

What does $10 million mean?

Sean hypothesizes that “this is direct evidence of individual donors’ increasing interest in impact.” I’m inclined to agree.

We often hear that donors don’t really care about having the most impact possible; they care about attending benefits, or dispelling the guilt/cognitive dissonance raised by an appeal, or identifying with a cause. We respond that at least some donors are motivated primarily by wanting to make the world a better place; the question is how many of these are out there (because we know that the total pie is quite large). And we honestly don’t know the answer to that question – better research is needed.

But now we know that 2008 saw at least $10 million come from people who could not have been motivated by social events (the Gates Foundation holds none and doesn’t allow fundraisers on its behalf), in-the-moment emotions (the Gates Foundation conducts no appeals and doesn’t have a particularly cute namesake), or identification with a pet cause (the Gates Foundation’s work includes U.S. education, international aid and more, and it doesn’t allow people to earmark for a specific cause).

The only reasoning I can think of for giving to the Gates Foundation is, “They’ll do a better job with this [in terms of making the world a better place] than I can, and that’s what I want even if it doesn’t come with the donor perks of a traditional charity.” If you disagree and can think of a less altruism-based reason, please share in the comments.

Of course, that $10 million could all have come from 1-2 people for all we know (especially since only $1.6 million came in the year before). More on this below.

Will the Gates Foundation help us learn more about these donors?

Correction (added 6/11/09): Sean Stannard-Stockton has pointed out that the Gates Foundation will be releasing the names and amounts for all donors who gave more than $5000, as required by law. Assuming this is correct, the remainder of this post (from here until the end) should be disregarded.

There is growing interest improving donors’ access to quality information. In order to do this well, it would help greatly to know whom to target – in particular, whether the lion’s share of “impact-focused” charity is coming from tiny, medium, large, or mega donors. At this point we know so little about this question that having the breakdown of donation sizes from the Gates Foundation would, I believe, add a lot to our understanding.

I believe the Gates Foundation could be a good citizen and helpful to the cause of improving philanthropy by releasing information on how many donations it received of different sizes. Aggregating them by “buckets” (<$100, $100-500, etc.) and keeping all names confidential would allow this information sharing without compromising anyone's privacy. Will they do it?

The challenge of local ownership

(updated on: ) | by Holden

One of the consistent refrains we’ve seen in aid literature is the importance of local participation/enthusiasm/ownership for aid projects. Many programs have been criticized for being too “top-down” (i.e., imposing outsiders’ designs on local communities), with the implication that more “bottom-up” programs (i.e., getting local people to participate in the design of execution of programs) would be more likely toi create real and lasting change. For an example of this reasoning, see this USAID review of Integrated Rural Development programs (PDF).

The basic reasoning makes sense, but making a program “bottom-up” is easier said than done. For an illustration of why, see this World Bank review of “community-based development,” a term referring to “projects that actively include beneficiaries in their design and management.”

The frequent tendency for participatory projects to be dominated if not captured by local elites is highlighted by several case studies. Katz and Sara (1997), in a global review of water projects, find numerous cases of project benefits being appropriated by community leaders and little attempt to include households at any stage … even well trained staff are not always effective in overcoming entrenched norms of exclusion. In a study of community forestry projects in India and Nepal that worked reasonably well, Agarwal (2001) reports that women were systematically excluded from the participatory process because of their weak bargaining power. Rao and Ibanez (2003) find that in the participatory projects in their Jamaican case study, wealthier and better networked individuals dominated decision making. In a similar case-based evaluation of social funds in Jamaica, Malawi, Nicaragua, and Zambia, the World Bank (2002) Operations Evaluation Department concludes that the process was dominated by “prime movers.”

Abraham and Platteau (2004) present evidence on community participation processes in Sub-Saharan Africa based largely on anecdotal evidence from their work in community-based development and on secondary sources. They argue that rural African communities are often dominated by dictatorial leaders who can shape the participation process to benefit themselves because of the poor flow of information. (40-41)

These notes capture a concern of ours that applies to all aid projects: while the goal is to help those in the most need, those with the least need may be most likely to have the resources, connections and free time to get the inside track on any particularly generous aid project. This is also a major reason to be skeptical of simple evaluations comparing “project participants” to “non-participants,” as many microfinance evaluations do. Project participants may simply be better off to begin with (and some studies show that they are, such as the Coleman study referenced on the previous link).

We don’t believe that a simple and straightforward way to overcome this challenge is available. That’s why, although we agree with the basic concept that local ownership will improve a project, we don’t tend to judge projects by their formal commitment to local ownership – i.e., we don’t favor programs that work in formal community votes, meetings, etc. over programs that don’t. The former could be improving local participation or transferring more power to elites; the latter could be generating local enthusiasm simply through a good match between what people want and what they’re being offered.

It’s easy to claim that one is involving community members, but the ultimate test is in outcomes – whether the project ran well enough and generated enough local participation to accomplish its ultimate goals (improved health, incomes, etc.)

Embedded philanthropy

(updated on: ) | by Holden

This blog post is part of the Embedded Philanthropy Blog Series, sponsored by Telecom for Charity. The blog series was launched in May 2009 to highlight expert thinking and encourage discussions on the state of embedded philanthropy in today’s economy.

“Embedded philanthropy” (as defined by former GiveWell Board member Lucy Bernholz, via Tactical Philanthropy) is the practice of “building a philanthropic gift into another, unrelated, financial transaction.” The RED Campaign is probably the best-known example.

If you are thinking of participating as a consumer in embedded philanthropy, we urge you not to. Fundamentally, you are the one ultimately paying for the donation, as we discussed thoroughly here (if you don’t find the main post convincing, please see the comments as well).

Once you accept this claim, it appears that embedded philanthropy offers you, the consumer, no benefits, and has a couple of costs: (1) it narrows your options as a consumer (for example, you buy (RED) clothing instead of whatever clothing you want); (2) it narrows your options as a donor (i.e., the amount and recipient of your giving is determined by the company, not by you).

(2) is the more severe problem, and in some cases there may be ways around it. Telecom for Charity, the sponsor of this series, has informed me that its consumers can choose to donate to any charity of their choice (although I do not see this spelled out on its website). And with careful enough accounting, you can also make sure that your total giving for the year isn’t altered. But even in this best-case scenario, what’s the point? Why not just buy what you want and give what you want?

Much embedded philanthropy threatens to shift the choice of charity from individuals (giving for their individual reasons) to corporations (likely purely concerned with the PR aspects of the gift). All embedded philanthropy threatens to make donors feel they’ve “done their part” by signing up, instead of challenging themselves to give as much and as well as they can. No embedded philanthropy seems to offer genuine benefits to the consumer/donor. No embedded philanthropy can deliver on what I see as an implicit promise of “something for nothing” – the virtue of giving without the sacrifice.

Despite all this, embedded philanthropy may be a net force for good if it mobilizes enough giving that wouldn’t have occurred otherwise. It’s hard to turn our nose up at (RED)’s claim to have directed over $130 million to the Global Fund to fight Aids, Tuberculosis and Malaria (which we view as an unusually strong charity). (RED) has had an amazing amount of corporate and celebrity support, and I haven’t seen any other embedded philanthropy campaigns that appear to have had anywhere near the same impact.

We don’t pretend to know much about mass fundraising; we target the specific donors who seek to accomplish as much good as possible. Embedded philanthropy may be effective for the former; we feel it has little to offer the latter.