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This is great. Something people often disregard, but which is hugely important, is charity effectiveness. This boils down to measuring the impact that you can m

by rjshade 14y ago

This is great. Something people often disregard, but which is hugely important, is charity effectiveness. This boils down to measuring the impact that you can make with a given donation: it turns out some charities are literally thousands of times more effective than others. A lot of people don't realise how much good they can do with modest donations to the right charities -- until a year ago I really had no idea myself. There are a couple of groups which I know of which do analysis of charity effectiveness: * Giving What We Can (http://www.givingwhatwecan.org/ http://www.givingwhatwecan.org/) are an Oxford, UK based organisation who estimate that you can save a life for ~£300. * GiveWell (http://givewell.org/ http://givewell.org/) are a US group who do similar research They both publish lists of the most effective charities they've researched, and Giving What We Can have a calculator which shows you how much you can achieve by donating 10% of your income each year: http://www.givingwhatwecan.org/resources/what-you-can-achieve.php http://www.givingwhatwecan.org/resources/what-you-can-achiev... I think these stats are astonishing and it's really changed my approach to charity. Worth checking out if you're interested at all in philanthropy!

rjshade 14y ago
Oh and this is similar to the approach that the Gates foundation is taking. As far as I can tell Gates approached this as an optimisation problem: given that he has X billion dollars to give to charity, how can he maximise the effect that his donations have? How many lives can he save* with that money? * lives saved is of course the wrong metric: no-one has ever saved a live, just prolonged it, but it's a convenient shorthand for maximising the number of quality adjusted life years (QALYs)[1] that a donation could buy. [1] http://en.wikipedia.org/wiki/Quality-adjusted_life_year http://en.wikipedia.org/wiki/Quality-adjusted_life_year
- jessriedel 14y ago
  All good stuff, but I'd want to emphasize that directing your philanthropy based on doing the most good does not require you to be a utilitarian, nor (if you are) does it require the utility function be denominated in QALYs.
jimmyvanhalen 14y ago
clearly a PR ploy. it's a waste of capital imo. Reduce your management fee and carried interest income and return them to your LP. or re-invest that capital in start-ups to create even more jobs. edit: it's their money and what they do with it is their business. but they're in the venture capital business, not in the charity business. their job is to deploy capital and maximize returns to their investors (they create jobs and companies in the process). Horowitz shakes off the potential for such troubles at Andreessen Horowitz, saying that half of firm earnings will be more than enough to satisfy its partners' lifestyles. "We don't play polo," he says. "And our skills are better suited for doing this than working full-time at a non-profit... I think this works out better for both us and the nonprofits." Again: If they think they're earning too much. reduce their management fee and carried interest income and return the money to their LPs.
- lotharbot 14y ago
  > "they're in the venture capital business, not in the charity business" They're in the business of being human. As is true for any of us, that means something complex, multidimensional, and personal. It's not some sort of affront to venture capitalism to use the profits it generates for something other than more venture capitalism. It's not a "waste of capital" to use your own capital for whatever you find important.
  - jimmyvanhalen 14y ago
    the money they make for their LPs goes to pension funds, universities, businesses, etc. which in turn creates more jobs, start-ups, investments, donations to charities, etc. If you're going to donate to charity, do it personally and without all the media hype.
    - lotharbot 14y ago
      The money they give to charity goes to researchers, consumers, and so on. That money gets spent, moving back into the economy, which creates more jobs, start-ups, investments, donations to charities, etc. It's hard to say which route generates more benefit down the line; I have yet to see a robust economic model that handles even second-order effects well. Media hype can be a good thing or a bad thing. If it's about your own ego, I agree, STFU and give privately. But hype can also convince others to change their behavior. Consider the use of "matching funds" as an incentive to increase charitable giving. Various publicity techniques (such as somebody famous emphasizing philanthropy) can increase giving or help direct it to where it can do the most good.
hprhpr 14y ago
Agreed about the importance of making sure you donate to the right charities, which is why I was disappointed to read this: "And, to begin, they have sprinkled $1 million on Silicon Valley nonprofits that focus on everything from urban forestry to homeless families." Another good essay about this stuff is here: http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others/ http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others...
- rdl 14y ago
  Given that "how people donate money" (or spend money, or invest money seems to conflict with what they claim are their stated preferences, I wonder which is more representative. I'd bet on the revealed preferences by actions. Basically no one would say (or is allowed to say in polite company) that they care more about having art available locally than the lives of a thousand people in some third-world country that they'll never meet. Yet, it seems pretty obvious that donations to local art save fewer lives than the anti-malarial mosquito nets, and should be obvious to the people donating.
  - hprhpr 14y ago
    Agreed about nobody saying they prefer local art over thousands of lives, but I don't think that means their revealed preferences are more representative of what they really want, I think it just shows how irrational they are. Most people don't sit down and think about what they want most and construct a plan to achieve that, so it shouldn't be surprising that they end up doing such drastically sub-optimal things as donating a lot of money to a museum when someone asks them to. It seems like a good thing to do, so they do it. They don't consider whether it's what they actually most prefer.
    - rdl 14y ago
      I also thought a lot of the art donations (at the high end) were weird tax dodges, or done for the ancillary benefits of donating (getting your name on a building or bench, access to high end parties, cute art girls, etc.)
    - 14y ago

by rjshade 14y ago

rjshade 14y ago

Oh and this is similar to the approach that the Gates foundation is taking. As far as I can tell Gates approached this as an optimisation problem: given that he has X billion dollars to give to charity, how can he maximise the effect that his donations have? How many lives can he save* with that money? * lives saved is of course the wrong metric: no-one has ever saved a live, just prolonged it, but it's a convenient shorthand for maximising the number of quality adjusted life years (QALYs)[1] that a donation could buy. [1] http://en.wikipedia.org/wiki/Quality-adjusted_life_year http://en.wikipedia.org/wiki/Quality-adjusted_life_year

jessriedel 14y ago
All good stuff, but I'd want to emphasize that directing your philanthropy based on doing the most good does not require you to be a utilitarian, nor (if you are) does it require the utility function be denominated in QALYs.

jimmyvanhalen 14y ago

clearly a PR ploy. it's a waste of capital imo. Reduce your management fee and carried interest income and return them to your LP. or re-invest that capital in start-ups to create even more jobs. edit: it's their money and what they do with it is their business. but they're in the venture capital business, not in the charity business. their job is to deploy capital and maximize returns to their investors (they create jobs and companies in the process). Horowitz shakes off the potential for such troubles at Andreessen Horowitz, saying that half of firm earnings will be more than enough to satisfy its partners' lifestyles. "We don't play polo," he says. "And our skills are better suited for doing this than working full-time at a non-profit... I think this works out better for both us and the nonprofits." Again: If they think they're earning too much. reduce their management fee and carried interest income and return the money to their LPs.

lotharbot 14y ago
> "they're in the venture capital business, not in the charity business" They're in the business of being human. As is true for any of us, that means something complex, multidimensional, and personal. It's not some sort of affront to venture capitalism to use the profits it generates for something other than more venture capitalism. It's not a "waste of capital" to use your own capital for whatever you find important.
- jimmyvanhalen 14y ago
  the money they make for their LPs goes to pension funds, universities, businesses, etc. which in turn creates more jobs, start-ups, investments, donations to charities, etc. If you're going to donate to charity, do it personally and without all the media hype.
  - lotharbot 14y ago
    The money they give to charity goes to researchers, consumers, and so on. That money gets spent, moving back into the economy, which creates more jobs, start-ups, investments, donations to charities, etc. It's hard to say which route generates more benefit down the line; I have yet to see a robust economic model that handles even second-order effects well. Media hype can be a good thing or a bad thing. If it's about your own ego, I agree, STFU and give privately. But hype can also convince others to change their behavior. Consider the use of "matching funds" as an incentive to increase charitable giving. Various publicity techniques (such as somebody famous emphasizing philanthropy) can increase giving or help direct it to where it can do the most good.

hprhpr 14y ago

Agreed about the importance of making sure you donate to the right charities, which is why I was disappointed to read this: "And, to begin, they have sprinkled $1 million on Silicon Valley nonprofits that focus on everything from urban forestry to homeless families." Another good essay about this stuff is here: http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others/ http://lesswrong.com/lw/3gj/efficient_charity_do_unto_others...

rdl 14y ago
Given that "how people donate money" (or spend money, or invest money seems to conflict with what they claim are their stated preferences, I wonder which is more representative. I'd bet on the revealed preferences by actions. Basically no one would say (or is allowed to say in polite company) that they care more about having art available locally than the lives of a thousand people in some third-world country that they'll never meet. Yet, it seems pretty obvious that donations to local art save fewer lives than the anti-malarial mosquito nets, and should be obvious to the people donating.
- hprhpr 14y ago
  Agreed about nobody saying they prefer local art over thousands of lives, but I don't think that means their revealed preferences are more representative of what they really want, I think it just shows how irrational they are. Most people don't sit down and think about what they want most and construct a plan to achieve that, so it shouldn't be surprising that they end up doing such drastically sub-optimal things as donating a lot of money to a museum when someone asks them to. It seems like a good thing to do, so they do it. They don't consider whether it's what they actually most prefer.
  - rdl 14y ago
    I also thought a lot of the art donations (at the high end) were weird tax dodges, or done for the ancillary benefits of donating (getting your name on a building or bench, access to high end parties, cute art girls, etc.)
  - 14y ago