On the Effectiveness of Charitable Giving

There are no guarantees, and what matters in the long run may not be what you think.

Michelangelo’s David, photo by Flickr user Brian Dooley, public domain

The 400 florins that Florence paid Michelangelo to carve the David could have provided a whole year’s subsistence living for about 100 Florentine residents. Was the commission an immoral use of funds? Should the money instead have gone to the poor, some of whom surely starved without it? If justified for reasons of civic cohesion, would the sculpture have been unjustified as a private purchase like much other Renaissance art? And what about its value to the future? If Florentine authorities in 1501 had known Michelangelo’s masterpiece would become a major tourist attraction centuries later, bringing untold wealth and admiration to their city, should that future have entered their calculations?

Such were the thoughts that crossed my mind last month, when I read

Shruti Rajagopalan

’s excellent essay “Altruism and Development - It’s complicated......” In it, she examines how to assess the value of philanthropy if we want to “do the most good” in the world—the challenge posed by the movement known as Effective Altruism. Effective Altruism takes various forms, from the extreme utilitarianism of philosopher Peter Singer to practical cost-benefit assessments of charitable ventures. (Here’s a useful blog post delving into the philosophical distinctions.)

Shruti starts with a personal dilemma. Should she give to ameliorate the problem of Delhi’s terrible air pollution or support the anti-malaria causes dear to GiveWell and other EA advocates?¹ Shruti, who works at the Mercatus Center at George Mason University, is from Delhi. She is under doctor’s orders not to return to visit her family because the pollution will aggravate her long Covid problems. Given her personal stake in the city’s air pollution, she worries that her charitable giving impulses are too emotional.

With air pollution dominating my thoughts and nudges for charitable giving in my inbox, my first instinct is to give to causes that help mitigate pollution in Delhi. But I am also aware of the literature on emotional giving or ineffective altruism. In their 2021 paper, Caviola, Schubert and Greene explain why both effective and ineffective causes may attract dollars. People often give emotionally to a cause that has personally impacted them in some way.

A US$100 donation can save a person in the developing world from trachoma, a disease that causes blindness. By contrast, it costs US$50,000 to train a guide dog to help a blind person in the developed world. This large difference in impact per dollar is not unusual. According to expert estimates, the most effective charities are often 100 times more effective than typical charities.

This paper resonated with me because I am exactly the sort of irrational dog lover likely to support the best training programs for guide dogs.

Working through the numbers, she finds that air pollution in Delhi is, in fact, just the sort of massive public health problem that EA types elevate as worthy of philanthropy. (It generates what my husband, in high school debate jargon, would call “bodies on the flow.”) But air pollution lacks an essential characteristic of EA-favored causes: an easy way of measuring interventions and their effectiveness. Shruti writes:

There are many reasons air pollution mitigation doesn’t make it to the top of these lists despite a ten times higher death toll. It cannot be avoided by distributing a $5 net. The costs and the benefits from air pollution in Delhi cannot be easily quantified. Nor can the benefits from the interventions to mitigate pollution be easily measured. Simply put, air pollution in Delhi is complex, while malaria death and malaria nets in Africa are legible. We can only evaluate impact of interventions and projects that are legible. And only studying complex phenomena narrowly can make them legible.

But that’s not the end of it. The more she digs, the tougher the problem becomes. I recommend reading (or at least skimming) the entire analysis. Eventually she starts to think about why malaria declined in India, what malaria and Delhi air pollution have in common, and why we don't see similar problems in places like DC or London. ("Outside of camping equipment stores, I don’t think I have seen any mosquito nets bought or sold in the U.S.") Ultimately the problem isn’t tightwad westerners, but dysfunctional institutions and insufficient economic growth.² Her conclusion:

If you want to make the greatest impact in the long term, nothing can beat contributing to institutions working toward increasing economic growth and prosperity in poor regions like Africa and India. Increasing economic growth will help solve both malaria and air pollution. It will be your least attributable contribution, but the one with the highest impact.

Beggars at a Doorway, Master of the Béguins (possibly Abraham Willemsens, Flemish, active by 1627, died 1672), active 1650–60, Metropolitan Museum of Art

Effective Altruism suffers from the blind spots that are characteristic of highly intelligent, self-described rationalists: hubris and a fixation on counting things. It assumes that it’s easy to tell what will do good and that the only way of “doing good” is directly extending life expectancy. (You can count those “bodies on the flow.”) But, as Shruti points out, economic growth is the most effective avenue to saving lives.

And you don’t get economic growth from a philosophy that tells people they are morally culpable for countless deaths if they consume anything more than absolutely necessary. The bourgeois fellow in the painting above may be doing his Christian duty by giving to beggars, but it’s his business enterprise and spending on frivolous things like paintings that raised living standards in the Low Countries. Bernard Mandeville was on to something in The Fable of the Bees, when he scandalously suggested that the selfish pursuit of luxuries could make everyone better off.

Historians may argue about the exact connections between the consumer revolution of the 17th and 18th century, the industrial revolution, and the long-term great enrichment. But these three phenomena were definitely intertwined. As an organizing principle, self-sacrifice is a prescription for not just for personal misery but for global impoverishment.

I’m all for generosity. I’m glad people give to cure river blindness or prevent malaria. I’ve been known to take GiveWell’s advice and to send money to GiveDirectly, whose philosophy of giving cash to poor individuals in poor countries makes a lot of sense to me. On the margin, Effective Altruism does more good than harm. It’s the philosophy of a small elite who might not be especially generous without it.

But the “ineffectiveness” of sponsoring guide dogs to help blind Americans or donating to keep research libraries stocked with obscure titles isn’t a bug. It’s a feature. The diverse enthusiasms of generous people make for a richer cultural environment.

Walmart heiress Alice Walton thought the Ozarks should have a first-class art museum. “My mama always said, ‘Give the thing you love the most.’ And other than family, I decided that had to be art,” she says. Some people love ballet, some animals, some free speech, some amateur astronomy. Love of all sorts motivates a wide range of giving.

Andrew Carnegie funded hundreds of public libraries because he himself had used a generous man’s library to educate himself as a poor working boy. Like many benefactors, he used his money to create a better environment for people like his younger self.

Whatever its motivations, diversified giving helps correct for the limitations of our knowledge. We don’t know today what will matter tomorrow, how, or to whom. The human enterprise depends on many different, often incommensurable values, not all of which can be plugged into a spreadsheet. Life is fundamental but also more than mere existence. The David was worth the money—yesterday, tomorrow, and forever.

1. To understand GiveWell’s work, I recommend this interview with co-founder and CEO Elie Hassenfeld. Unlike philosopher Peter Singer, who often comes off as a combination of Ayn Rand villain and hedge fund recruiter, GiveWell is practical and modest about what it can reasonably say with authority. It provides a valuable tool, not a universal giving prescription.

2. Her discussion of why we don’t worry about malaria in the U.S. reminds me of my experience getting a typhoid vaccine before going to India to research The Fabric of Civilization. When I said that I remembered typhoid shots being especially painful when I was a child, the woman administering them asked, “Where did you grow up, Africa?” I answered, “South Carolina.” And why don’t we worry about typhoid in South Carolina anymore?