Monthly Archives: October 2011

Old problem

To give away money is an easy matter in any man’s power. But to decide to whom to give it, and how large and when, and for what purpose and how, is neither in every man’s power nor an easy matter.

— Aristotle (Ethics, 360 BCE)

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Opportunity Child

Happy helping people is not enough when the factors that determine resource allocation are improper.

The the previous posts we have seen that resource allocation is based on a number of things – proximity, emotions, timing – but that efforts to define and measure actual outcomes are lacking.  The result is that resources are likely misdirected such that sizable opportunity costs can be measured in actual children killed (not saved) because of the action of badly determined criteria.

Let me explain.  An NGO is spending $100m on children in a crisis in Africa.  We don’t know exactly what effect this will have (because it is not measured) but the NGO hopes to save $4m children.  That’s $25 per child, which sounds pretty good.  But is it?  First of all, $25 might not be all that cheap, despite huge healthcare costs in the West it might be possible to help a child for much less in a different context and for a different ailment.  Second, we haven’t really defined ‘life saved’ (see previous post), although we could just do that.  Let’s say it is that the child lives beyond childhood and reaches 16.  That doesn’t solve the problem since, third, we haven’t measured what actually happens and the ‘confidence interval’ on our 4m saved estimate is very wide, wide enough that resource allocation goes from cheap and effective to extremely expensive, even wasteful.  So a number of things have to come together for the $100m for 4m claim to hold up and without it there is a good chance that our $100m is not helping as many children reach 16 as it would do if it were spent elsewhere.  What seems like a rational basis for action – maximum number of children reaching 16 per dollar spent – is not the basis at all.

As a result, children needlessly fail to reach 16 – are saved – when we have the funds to help them.

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Critical ALNAP

The  Active Learning Network for Accountability and Performance in Humanitarian Action (ALNAP), established in 1997, is probably the most respected inter-agency body looking at accountability in the humanitarian sector.  So, you can imagine how I responded to this update on the Humanitarian Performance Indicators Working Group in their annual report:

Launched in 2009, the ALNAP Working Group  on Humanitarian Performance Indicators set out to provide a forum for members to share their experiences and thoughts on approaches to organisational and programme performance indicators within the humanitarian system. After discussions in the group about the difficulty of establishing a clear direction, it was decided to dissolve the group for the time being and to incorporate discussions on performance indicators into the development of the methodology for the next iteration of ‘The State of the Humanitarian System: Assessing performance and progress.’ In 2011/12, ALNAP will decide whether there is additional value in reconvening the Working Group

If you can stifle your laughter or manage not to choke on your coffee then you’ve done well.  The group convened, discussed difficulties and the dissolved within two years.  Reminds me of another critical issue.

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Can’t give, won’t give

In the last few years a lot of effort has gone into evaluating the effectiveness of charities. The organization Giving What We Can emphasis that cost-effectiveness in charities is essential:

…even restricted to the field of health programs in developing countries, research shows that some are up to 10,000 times as effective as others.

The site divides charity giving into categories, such as health, education and empowerment.  Within the health section,  the site gives a nice breakdown of disease priorities according to the effectiveness of their treatment (largely based on the DCP2 from the Disease Control Priorities Project), where effectiveness is measured in disability adjusted life years per dollar spent.  All well and good.  However an interesting thing happens when you click on the Emergency Aid section:

It is a very difficult intervention type to assess, because it is so wide-ranging, there is little quantitative data, and because each emergency is unique. At this point in time, we have no information on the cost-effectiveness of different types of emergency aid, but we hope to rectify this in the future.

For a more detailed analysis of an intervention-type, see our pages on health.

For all their work, this charity cannot find any data to estimate the effectiveness of emergency relief.

There is no basis on which to separate emergency and health programs.  Both are concerned with saving lives, they have the same outcome of interest.  Emergency conditions appear differently to us, the giver, but to the patient who is dying the conditions don’t seem that different.  Yes, we see/hear/feel more about emergencies than ‘normal’ health problems and emergencies have a sort of ‘Biblical’ significance, but from the point of view of a child dying of malaria, or the mother of a malnourished baby, I don’t imagine there is a distinction.

What this site and others show, in high contrast, is the peculiar position of humanitarian aid in our thinking.

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Tyranny of the local-present

We live under an irrational tyranny that the people in the present are more important than people in the future.

This is probably obvious: certainly, we spend much more treating diseases than it would cost to prevent the diseases in the future.  Also, we experience this phenomenon in other areas of our lives; being unable to delay ‘gratification’ and going for early gains.  But is it acceptable when delivering aid?

Tyranny is a strong word, but I think that it’s apt.  People in the present are the only ones with a voice and a claim for resources, resources that are finite.  From health to the environment we are selling those yet to exist short.  Granted, people in the future don’t exist now just as people in the past don’t exist now.  The difference is that our decisions now will affect people in the future.  And they don’t have a say in our decisions, they live under our tyranny.

Delaying gratification is often cited as a mark of maturity and rationality.  The idea of credit and investment is central to this.  We would save more lives, in the long run, if we invested in future generations with the money that we spend on the present.

There is another tyranny plays out as an irresponsible bias: the tyranny of location.  This has two features: tyranny of things that happen close to us (local) and tyranny of things that happen more often in one place (locality).

The first is well known and complicated by the fact that people close to us are also like us.  The second, the tyranny of things happening in the same place, is different.  We pay much more attention to tragedy when it is localized than when it is spread out.  Bono tells us that 30,000 children have died in the last 3 months in Somalia because of the Famine.  When he tells us this he does so as if this is some dirty secret that no-one wants to talk about.  But we are talking about it.  We’re not talking about the estimated 3,000 children that die each day from malaria, for example.  That happens in their own homes and is difficult to capture within one shot.  The numbers are not the issue, it is the concentration of misery which is attracting celebrity attention.

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