Blog

Stay up to date with Giving What We Can's blog. Featuring the latest news about our community, how to donate effectively, charity evaluation, community events and more!

Giving What We Can's blog, featuring the latest news from our community.

Donate

Pledge

footerNavigation

About us

Contact us

Our team

Our values

Our members

Our events

Transparency

Our mistakes

Our impact

Donate to Giving What We Can

Careers

Leave feedback or make a complaint

About

Our best charities

Take a giving pledge

Get involved

Make a bequest

Videos, books, podcasts

FAQs

Learn more

Press kit

Media coverage

Case studies: People who pledge to give

Media

Footer Navigation

DONATE

topNavigation

Best charities

High-impact causes

Why give to funds

How much to donate

Why donate publicly

Recommendations

Our research & approach

Comparing charities

Evaluating evaluators

Our approach

Giving guides

Videos, books, podcasts and essays

Hesitations about charitable giving

How rich am I?

Can money buy happiness?

Resources

Research

About Us

Our governance structure

Team

Newsletter

Videos

Take the Pledge

Connect with our community

Share our ideas

Events

Giving games

Charity elections

Pledge drive

Fundraisers

Social Shareable Images

Community

What is the Pledge?

Why pledge instead of just donating?

Share the Pledge (inspire others!)

Pledge signers

My Pledge

🔹Trial Pledge

Company Pledge

Further Pledge

Bequests

Have a 1-on-1 call about pledging

Donate now

Manage my donations

Tax deductibility

Top Navigation

Marinella Capriati

What’s so special about GiveDirectly’s basic income pilot? 

 a universal basic income intervention in Kenya: they’re planning to provide about 6,000 people with unconditional transfers for at least 10 years, transferring money to all residents of the villages which will be targeted by the intervention. This has received a lot of attention from the media, with the trial being mentioned, among others, on 

In this blog post I’ll try to give this news some context, by comparing this intervention with some alternatives. I will start by considering other types of transfers that can be made in the context of development interventions, looking at in-kind transfers and conditional cash transfer. Then I will focus on unconditional cash transfers, and specifically the ones that GiveDirectly has been delivering up until now, and explain what’s different and interesting about their new basic income pilot.

Part of international development aid is about re-distributing resources to people living in poverty. But while this seems pretty straight-forward, it is in fact not easy to work out exactly what type of resources we should move, and how they should be moved.

Traditionally, much development aid has focused on 

, that is, on the provision of specific goods and services. This might include very disparate things: from cattle, books or food, to schools and hospitals. However, some argue that 

providing cash might be better that providing in-kind aid.

 There are several arguments for this thesis, but here I’ll just mention two points. First, providing cash can be 

 This is becoming increasingly true thanks to new electronic ways of moving cash: for instance, GiveDirectly makes transfers through mobile phones, which can be cheaper than in person distributions.

 Secondly, providing cash generally leaves recipients more 

 This is good because recipients might have better information about what would be most useful for them.

However, some do not think that in-kind aid should be substituted by cash transfers. Part of the disagreement is rooted in worries about recipients 

 (what are sometimes referred as ‘temptation goods’). In fact, however, evidence suggests that this worry is 

: the evaluation of GiveDirectly’s cash transfer program shows no increase in spending on temptation goods.

Other worries seem to be more pressing: supporters of in-kind transfers argue that some essential services (such as hospital, roads and schools) 

bring benefits to people other than the recipients

 (they lead to what economists call “positive externalities”): for example, hospitals and school are likely to increase levels of health and education, and healthy and educated workers are likely to be more productive, which would in turn benefit not only them, but also the wider population. Goods which have positive externalities are likely to be 

, so might not be adequately provided through cash transfers.

Interestingly, however, cash transfers are not always offered as an alternative to public services. Sometimes, transfers are used with the specific intent of increasing the uptake of these services. This is the case of 

: transfers which are conditional on the satisfaction of certain behavioural requirements, generally concerning the health and education of children resident in the recipient household. For instance, Mexico’s “Oportunidades” conditional cash transfers programme, provides cash transfers to households conditional on their children regularly attending school and making health clinic visits.

, which means that transfers are made without any condition being set.

We have written extensively about the advantages and disadvantages of conditional and unconditional cash transfers in our new report on 

. The (really short) summary is that conditional cash transfers lead to 

 than unconditional cash transfer: more people employ education and health services, which increases workers’ skills, knowledge, and experience. However, unconditional cash transfers have the advantage of 

 households simply because they may not meet certain behavioural requirements and allow vulnerable households to identify their own needs

. They also have lower administrative costs than conditional cash transfers, since there is no need to verify that the conditions have been met.Because of this, unconditional cash transfer have received increasing attention as a tool for international development.

Other types of unconditional cash transfers

GiveDirectly provides beneficiaries with unconditional cash transfers

 - they transfer low-income households a certain amount of money, without any condition attached. They have been doing this for a while, and have mainly worked in Kenya and Uganda.

Yet, many people seem to be pretty excited about GiveDirectly’s news that they will be testing a basic universal income and their announcement of the pilot has received a large amount of media attention. 

So what is so different about their new basic income program?

First of all, the basic income pilot will provide transfers to 

all full-time residents of treatment villages

 Up until now, GiveDirectly has been only providing transfers to some people in target villages. However, some evidence suggests that an increase in the mean wealth of the village is correlated with a significant decrease in life satisfaction among individuals in households that did not receive transfers.

 By targeting all residents, universal basic income might avoid this problem.

Secondly, the basic income pilot will provide 

smaller and regular transfers for 10 years

. While the details of the pilot are yet to be defined, the payments are expected to amount to somewhere between $250 and $400 a year per person

. In contrast, GiveDirectly’s has so far made one-off transfers of about $1000. This change is interesting because having a transfers for longer time might give people the security needed to take more risks and invest a larger portion of their resources, which might enable them to increase their income in the long run.

GiveDirectly universal basic is unlikely to be able to substitute the provision of public goods, or lead to as much investment in human capital as conditional cash transfers would. However, it is likely to be a cheap and flexible way of transferring resources, that can provide an inclusive safety net for people living in poverty. It will also avoid decreases in life-satisfaction for households not receiving transfers (since all households in target villages will receive transfers) and might give recipients more financial security to make investments, and increase their longer term income.

Michelle Hutchinson

Using aid to finance the refugee crisis: a worrying trend  

In 2014 the number of displaced people exceeded 50 million 

for the first time since the Second World War

. This poses a particularly large problem for Europe, since refugee applications to the EU doubled between 2014 and 2015.

Thankfully, many European governments have stepped up to help. 

 registered around a million asylum seekers in 2015 - achieving this by speeding up processing time for people both from safe countries of origin and those from particularly unsafe countries of origin (especially Syria).

Unfortunately, this help has too often come directly out of Official Development Assistance (ODA) budgets (i.e. from national aid budgets). An Organisation for Economic Co-operation and Development (OECD) directive allows funding a refugee’s basic needs in a host country to count under ODA for their first year in a country, and a number of countries are taking advantage of that. (See page 2 of 

) The graph below shows how this directive has combined with the refugee crisis to lead to countries drastically reducing funds they are actually spending on overseas aid.

This trend is deeply troubling because it is comparatively expensive to settle refugees in countries like the UK. The costs to settle a refugee vary widely depending on the host country, but they’re on the order of $10,000 per year. (See page 3 of 

). When you consider that this is setting up a person with a new life, it isn’t that expensive. Yet when we compare how much we could otherwise be helping people with that money, the grave injustice becomes apparent. As one example, iodising salt to prevent iodine deficiency is estimated to cost 

 Providing this for children is estimated to produce an additional 50 years of schooling per $100, since iodine deficiency hinders cognitive development. And iodine deficiency is still very prevalent in countries that host most of the refugees such as 

Using the ODA budget to settle just one person for a year, then, prevents us from helping literally hundreds of children in equally bad situations to get a better education. It is still an extremely good use of money - but we should be finding that money elsewhere (perhaps through a 

Although there has been piecemeal news coverage of ODA budgets being used to settle refugees, there has been scarcely any coverage of this as a wider trend, and of the scale of the problem - highlighted by the graph above. Indeed, hosting or processing refugees now uses 9% of ODA - 

double the percentage it did the year before.

Some people argue that immigration is actually good for the host country, such that it seems as if 

spending money on settling immigrants is not actually ‘assistance’ at all.

 But even assuming that to be false, the striking unfairness of rich countries being unwilling to settle refugees from their own budgets rather than what is set aside for assisting poorer countries is brought home by the comparatively low burden of refugee intake borne by Western European countries and the USA compared to countries like Lebanon and Jordan:

How can we improve the situation? If we can raise awareness of this trend, we may be able to put pressure on governments to avoid it - to find alternative sources of funding for processing and settling refugees. The ONE campaign has 

 aiming to do just this. Writing publicly about this trend and why it’s problematic (whether on your own blog, or for your local newspaper), could also be helpful. More broadly, showing your support for international aid, such as by supporting 

 could help prevent aid money from being reallocated.

In the longer-term, the increasing evidence base about the efficacy of direct cash transfers in humanitarian crises may lead to their increasing adoption as a way of supporting people nearer their place of origin. A promising sign of increased popularity is the President of the World Bank 

speaking out about the importance of increasing their use

. Supporting GiveDirectly might be helpful in continuing this trend.

The number of displaced persons in the world today presents us with a significant humanitarian crisis. But we must avoid compounding the crisis by diverting aid spending. Hopefully, by 

 that we care about the issue, we can reverse this worrying trend.

James Snowden

Is Charity About Helping the Poorest?

Giving What We Can focuses on finding the charities which result in the most benefit to the greatest number of individuals. But should we give more weight to benefitting the worst off? Should we care more about equality and distributive justice?

Giving What We Can aggregates the benefits to different people 

 rather than giving extra weight to worse off individuals. While our top charities tend to help some of the worst off people in the world, we do not explicitly factor considerations of fairness and equity into our cost-effectiveness calculations. There are good reasons for this:

. It can be very complex to add together different benefits and also weight them differently for different people. This is why academic literature on cost-effectiveness tends to aggregate benefits additively.

. Aggregating these benefits additively relies on the ethical intuitions everyone actually has. While egalitarians care about the distribution of benefits, they also care about total benefits. Different people may have very different ideas about how much weight to place on considerations of equity. It is easier to add your own weighting than to adjust ones that we have assumed.

. Those who are worst off are usually the easiest to help as there are more “low hanging fruit” so to speak.

 is the only plausible ethical theory (as has sometimes been suggested

). But we do think that aggregating benefits additively provides a good starting point, which can then be supplemented by considerations of equity and fairness if required

. We are aware that many of our members (and staff) think that prioritising helping the worst off may be of 

 reasons (for the purposes of this post we will refer to both as egalitarian

). Recently, we’ve been thinking more about how our recommended charities fare on these ethical dimensions.

If aggregating benefits in an additive or egalitarian manner always came to the same answer (as it often does), that would be the end of the matter. Occasionally however, we may have to make a tradeoff between helping people who are worse off or helping a larger number of people. This post is intended to give the reader some additional considerations, which may help them think about how to weigh egalitarian concerns in choosing the most effective charities.

Additive benefits are the most important consideration when choosing an effective charity

. However, when the cost-effectiveness of charities is sufficiently close, it may be reasonable to factor in considerations of fairness and equity.

All our top charities fare well on considerations of fairness and equity

. This is unsurprising given that they are all charities which help children with preventable diseases in poorer countries.

Against Malaria Foundation (AMF) fares particularly well

 on fairness and equity grounds as it prevents a disease with a high individual disease burden which affects the economically disadvantaged.

It is possible that there are other comparably cost-effective charities which do better than some of our charities on fairness and equity. However, AMF sets a high bar, as it is estimated to save a life for about 

, and children who die under the age of five are certainly among the very worst off globally.

In 2014, the World Health Organisation published 

Making Fair Choices on the path to Universal Health Coverage

, which attempts to provide a framework for incorporating considerations of fairness and equity into healthcare prioritisation

. The report was authored by a diverse group of 18 health economists, ethicists and practitioners in order to represent broad ethical consensus. Several members of Giving What We Can contributed to the report

 suggests three different considerations when deciding which interventions to prioritise:

: How many people can be helped and how much they can be helped for a given level of resources?

: Are the people helped particularly disadvantaged?

: How much does the intervention reduce the risk of impoverishment due to catastrophic health expenditure?

Figure 1: Framework for integrating cost-effectiveness with other criteria when selecting services (Source: 

Not all these considerations should be given equal weight. The suggested decision procedure is to separate interventions into priority categories by setting overlapping thresholds for the cost-effectiveness of interventions. Where an intervention lies in the overlapping segment between different categories, considerations of priority for the worse off and financial risk protection are applied to determine which category it falls into. So while priority for the worse off is explicitly recognised as a relevant criteria for assessing which interventions to prioritise, it is only taken into account when the cost-effectiveness of two interventions is sufficiently close.

Under the example thresholds laid out in the report, all the interventions recommended by Giving What We Can fall firmly in the high priority category. That is, even if there were substantial reasons of fairness and equity to prioritise other interventions, this would only be relevant if those interventions were also within the high priority category.

However, there is still likely to be a substantial range of interventions which fall into the highly effective category and so, when the cost-effectiveness of interventions is sufficiently close, considerations of fairness and equity may come into play

One difficulty with factoring in priority for the worst off is that people can be worse off across a number of different dimensions. One solution would be to use a covering value of wellbeing which would incorporate all these considerations (such as subjective reported well being). Unfortunately, such a covering value would be very difficult to base on reliable data and highly controversial as different people value the various aspects of welfare in different ways. This mirrors the difficulties in evaluating charities on direct hedonistic grounds. In practice, consideration of who is worse off should be based on a number of different dimensions which contribute to welfare. The case studies accompanying the report (not yet released) make some suggestions

 In the absence of the intervention, would the beneficiary bear a large individual burden of disease? The individual burden of disease can be proxied by measures such as average years of life lost (AYLL).

 How badly off is the individual in terms of income, education or occupation?

So how do our top charities fare on these grounds?

Do our top recommended charities help the worst off?

all of Giving What We Can’s top charities help people who could be considered to be among the worst off in the world

. This is unsurprising given that they are all charities which help people with preventable diseases in relatively poor countries. We encourage donors who value equity and fairness highly to take these considerations into account to supplement our recommendations. In practice, however, it appears that substantial tradeoffs between total benefits and considerations of fairness are rarely required. We therefore plan to continue evaluating charities on the basis of their additive benefits.

Against Malaria Foundation helps people who could plausibly be described as the very worst off in the world (children who die under the age of five). 

For donors who place a very high weight on justice and equality, you could do a lot worse than 

Hauke Hillebrandt

Median GDP per capita: how much does the typical person earn in different countries? A look at Global Inequality

Check out our newer article from 2021 that goes into more detail on this topic.

A recent study asked people in the US what they thought the global median income was: participants thought it was $20,000 per year - 10 times more than it actually is.

 Respondents who were then told that the true global income distribution is much more unequal, i.e. that the global median income is much lower, supported higher spending on foreign aid and cuts in agricultural trade protections at larger rates. They also made donations to charities abroad that were 55% larger relative to people in the control group.

Whenever I read about a country that I don’t know that much about, GDP per capita statistics are usually the first thing I look up on Wikipedia. Of course, income only gives a limited picture of a country, but I want to get a general sense of the economic well-being of its people. But the 

 GDP per capita that one typically sees on Wikipedia can be quite misleading in that respect, because it doesn’t take into account wealth inequality (for a detailed explanation see the Appendix at the end of this post). And, until recently, 

 GDP per capita were hard to come by. But a few months ago, the Centre for Global Development released median income/consumption estimates of countries around the world.

This data was very useful for development economists who are interested in how many people live in extreme poverty with under $1,90 a day, but for lay people the problem with the presentation of the data was that it showed 

 income/consumption and most people are probably more used to think about 

 income/consumption. This is why I multiplied the values by 365 to get at the median income/consumption per capita per year around the world (I call this median GDP per capita for sake of comparison).

You can see that there’s considerable inequality within countries - in the United States $17,593 is the median income, whereas the mean GDP per capita is $54,629, which is what everyone would earn if you perfectly redistributed all income.

Blog

What’s so special about GiveDirectly’s basic income pilot?

Using aid to finance the refugee crisis: a worrying trend

Is Charity About Helping the Poorest?

Median GDP per capita: how much does the typical person earn in different countries? A look at Global Inequality

Everything you always wanted to know about the pledge (but were afraid to ask)

More than half a million pounds moved to top charities in Q1 2016

Why should I give if the rich don't?

The Life Equation

Is there a more effective way of getting a (better) malaria vaccine?

How to improve women's health in poor countries