GiveWell's cost-effectiveness analyses

Abstract

Our cost-effectiveness analyses are the single most important input into our charity recommendations. We view cost-effectiveness analyses as valuable for helping us identify large differences in the cost-effectiveness of grants we’re considering for funding and to encourage staff to think through relevant issues related to charities’ work. However, although we spend significant staff time on our cost-effectiveness analyses, we consider our cost-effectiveness numbers to be extremely rough. We do not make charity recommendations solely on the basis of cost-effectiveness calculations and will rely heavily on other factors, such as an organization’s track record, when we are comparing organizations with cost-effectiveness estimates that are not very different. The model relies on philosophical values—for example, how to weigh increasing a person’s income relative to averting a death—and difficult judgment calls about which we have limited information, such as the likelihood that a program as it is implemented will have the same impact as the program when it was studied. We encourage those who are interested to make a copy of the model and edit it to account for their own values. We also strongly encourage those who use our research to read more about our approach to cost-effectiveness and our page with details on a 2019 survey of about 2,000 people living in extreme poverty in Kenya and Ghana about how they value different outcomes.