EA - GWWC's Giving Multiplier by Joel Tan

The Nonlinear Library

Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: GWWC's Giving Multiplier, published by Joel Tan on September 3, 2024 on The Effective Altruism Forum. The Centre for Exploratory Altruism Research (CEARCH) works on cause prioritization research as well as grantmaking and donor advisory. This project is an external evaluation of Giving What We Can (GWWC) - specifically, its giving multiplier. We are grateful to the GWWC team for all the advice and data they have provided to us, and for their outstanding transparency and cooperation; we are also grateful to the various effective giving organizations and meta grantmakers we consulted during the research process. To avoid any conflict of interest, we have explicitly declined to be evaluated by GWWC in 2024 for its evaluate-the-evaluators project. Outline This is an estimate of GWWC's giving multiplier. This evaluation differs from GWWC's previous impact evaluation in two important ways: This is a prospective analysis aimed at estimating the marginal value of funding GWWC going forward (particularly, in 2025); in contrast, GWWC's previous evaluation was a retrospective focused on past average impact. We believe that GWWC's methodology for their impact evaluation is generally reasonable, and fairly conservative in important respects. However, we also believe that there were some limitations to their analysis, both in the exclusion of important variables, and in how included variables were estimated. In our evaluation, we attempt to improve on the original methodology as pioneered by GWWC. For all our calculations and sources, refer to our spreadsheet ( link). For our full report, see here (link). Results We estimate that GWWC's marginal 2025 giving multiplier is around 14x - for every additional $1 they spend on promoting pledging, around $14 will be raised for GiveWell top charities. Uncertainty is high and caution in interpreting results is advised. Key Model Parameters Estimating GWWC's marginal 2025 giving multiplier is challenging, for a number of reasons: Earlier pledge batches may differ from later pledge batches in their giving habits, as can an individual's giving change over time. Amounts that pledgers report giving may differ from actual giving. The counterfactual of how much pledgers would have given to highly-effective charities absent GWWC is fundamentally difficult to estimate. Cost-effectiveness varies even amongst top charities. The pledge is too young for us to observe giving patterns across an entire lifetime. Pledgers may simply not report their giving at all. Notwithstanding these difficulties, we take the following approach to estimating the following key parameters that we use to model GWWC's giving multiplier: Annual donations per pledger: To estimate how much a pledger gives annually, we use GWWC panel data to run a regression of dollars donated against pledge batch (or trial pledge batch) and year of giving, and then project out expected 2025 donations. We also calculate a simple average of dollars donated for the last 3 years. Both estimates are then used to form a weighted average. Pledgers: We found evidence that earlier pledgers give more than later pledgers - implying that the selection effect (i.e. self-selection of the highly zealous into the early EA movement) outweighs the income effect (i.e. rising GDP per capita over time). Meanwhile, for any given batch, pledgers gave about the same year after year, with income increases roughly balancing out attrition. Trial pledgers: In contrast, earlier trial pledgers give less than later trial pledgers - implying that the selection effect is outweighed by the income effect. Meanwhile, for any given batch, trial pledgers give less over time, with income increases swamped by attrition. Recording adjustment: To estimate how much is actually given by pledgers relative to what they report as giving, we...