Gold, frankincense and anti-parasitic interventions. How to really give this Christmas.

At Christmas, it feels good to give. 

But the wrong sort of charity can be a disaster. Even if you have millions of dollars and can control the way it’s spent, you can go wrong. See Madonna’s school building attempts in Malawi.

The world is full of people sending clothes to Africa. For example, NPR’s economics blog, Planet Money, recently found a t-shirt for sale in Kenya labelled Jennifer’s Bat Mitzvah, 1993 and tracked down the original Jennifer.

 

No doubt throwing away clothes is wasteful. No doubt people in Africa would like a cheap or free T-shirt. And sure, if someone’s been hit with a typhoon, giving them food and clothes helps. But if they are working in a textile factory, bombarding their country with millions of tonnes of donated clothes every year can be harmful.

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Charity grinch: Pouring cold water on your good intentions

In this case, it’s not the thought that counts.

There are charities sending food to Africa,  sending bicycles to Africa, sending iPods to Africa. In each case the people donating are the kind of good-hearted thrifty people who care about others and hate to see things go to waste. 

They are exactly the kind of people who should be open to critically examining their giving.

That’s where Givewell comes in. It compresses your warm fuzzy feelings into solid bricks and feeds them into the fire of critical analysis.

Set up by a Harvard university graduate and former hedge fund guy named Holden Karnofsky, Givewell now employs eleven full-time staff trying to figure out where you can invest your charity dollars without wasting them.

If this blog is sure of anything, it’s that human reasoning is weak. Especially where emotions are involved. That’s why this sort of effort is important.

Givewell is ruthless. Charities that don’t measure their own efficacy are not in the running. Charities that are not focussed on the world’s worst off are not in the running. They scoff at the idea of using the proportion of funds spent on administration as a measure of effect. They measure charities ability to absorb more money (their scalability) and cut them from the  list when it is exhausted.

They espouse a commitment to extreme transparency, which includes a prominent link on the front page of their website: Mistakes.

Givewell reviewed many charities in 2013 and recommended three. Two are programs that deworm children in Africa, and one makes direct cash transfers to the very poor in Kenya and Uganda.

Givewell is not above criticism (1, 2), and it has competitors, including Aidgrade. But if you want to buy a present that make the recipient happier than the gift giver, $50 for a single mother in Uganda will go a lot further than a couple of DVDs for your dad.

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thomasthethinkengine

Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

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