Chapitre 335: Efficient Charity: Do Unto Others[3]

What about just comparing charities on overhead costs, the one easy-to-find statistic that's universally applicable across all organizations? This solution is simple, elegant, and wrong. High overhead costs are only one possible failure mode for a charity. Consider again the Arctic explorer, trying to decide between a $200 parka and a $200 digital camera. Perhaps a parka only cost $100 to make and the manufacturer takes $100 profit, but the camera cost $200 to make and the manufacturer is selling it at cost. This speaks in favor of the moral qualities of the camera manufacturer, but given the choice the explorer should still buy the parka. The camera does something useless very efficiently, the parka does something vital inefficiently. A parka sold at cost would be best, but in its absence the explorer shouldn't hesitate to choose the the parka over the camera. The same applies to charity. An antimalarial net charity that saves one life per $500 with 50% overhead is better than an antidiarrheal drug charity that saves one life per $5000 with 0% overhead: $10,000 donated to the high-overhead charity will save ten lives; $10,000 to the lower-overhead will only save two. Here the right answer is to donate to the antimalarial charity while encouraging it to find ways to lower its overhead. In any case, examining the financial practices of a charity is helpful but not enough to answer the "which is the best charity?" question.