When should an effective altruist donate?
Introduction
Effective altruism is the use of evidence and careful reasoning to work out how to
maximize positive impact on others with a given unit of resources, and the taking ofaction on that basis. It’s a philosophy and a social movement that is gaining considerable
steam in the philanthropic world. For example, GiveWell, an organization thatrecommends charities working in global health and development and generally follows
effective altruist principles, moves over $90 million per year to its top recommendations.
Giving What We Can, which encourages individuals to pledge at least 10% of theirincome to the most cost-effective charities, now has over 3500 members, together
pledging over $1.5 billion of lifetime donations. Good Ventures is a foundation, foundedby Dustin Moskovitz and Cari Tuna, that is committed to effective altruist principles; it
has potential assets of $11 billion, and is distributing over $200 million each year in
grants, advised by the Open Philanthropy Project. 1
Philanthropists in the effective altruism community typically donate to charities that try
to improve the wellbeing of the poorest people in the world, the living conditions of
livestock in factory farms, or the long-term survival and flourishing of civilisation.
Highly regarded charities include the Against Malaria Foundation, which helps distributeinsecticide-treated bednets, Mercy for Animals, which runs campaigns to convince large
corporations to stop using eggs from caged hens, and the Blue Ribbon Study Panel on
Biodefense, which works to ensure that developments in synthetic biology don’t lead tocatastrophic outcomes, such as a man-made pathogen causing a global pandemic.
However, for the effective altruist, a crucial issue concerns timing. Rather than donating
as soon as she can, would she have a bigger impact if she saved her money, donating alarger amount of money at a later date? Or, if the opportunities available now are
sufficiently good, should she even take out a loan so that she can donate more of her
income now, and less in the future? This issue is crucial both for small individual donors
in the effective altruism community — most of whom currently donate regularly eachyear, but some of whom save in order to donate later — and for large donors like Good
Ventures, which is attempting to spend down its capital quickly, but is still saving thelarge majority of its wealth for a later date. 2
1 Effective altruism is not merely limited to charity, but to any way of trying to make the world a better

place. In particular, led by the organisation 80,000 Hours, there is a heavy focus on career choice. There are
now thousands of people around the world who have chosen their careers, at least in part, on the basis ofeffective altruist ideas: individuals have gone into scientific research, think tanks, party politics, social
entrepreneurship, finance (in order to do good through donating), and non-profit work in order to maximize
the good they can do.
2 For discussion of this issue by researchers within the effective altruism community, see Julia Wise,‘Giving now vs. later: a summary’, Effective Altruism Forum,
https://forum.effectivealtruism.org/posts/7uJcBNZhinomKtH9p/giving-now-vs-later-a-summary, and GoodThe thought that it might be most effective to invest one’s money in order to donate it at alater date seems often to be regarded as a surprising or counterintuitive conclusion; this isthe view of both moral philosopher Dan Moller and political philosopher Laura
Valentini.3 Though many individuals might choose to save their money and, for example,
donate in their will, this might be at best regarded as a compromise between altruism andself-interest, rather than warranted on the grounds of altruism alone.
However, in other contexts, we seem perfectly happy with the idea that an altruist should
delay their impact. For example, it seems perfectly obvious that an 18-year old who
wishes to use their life to do as much good as possible should, if they can, go to a good
university in order to increase their lifetime impact. But, in doing so, they are investing
four years of their time in order to have a larger impact over the rest of their life.
Similarly, the idea that foundations and universities should maintain their endowments,
spending only close to the legal minimum of 5% of their endowments, seems often to be
regarded as common sense. The idea that Stanford or Harvard should spend down theirendowment over the next few decades would be regarded as counterintuitive. But, again,
this is in effect to take the position that those donations are spent at least as well in the
future as they are now.
What’s more, though we seem to be intuitively unhappy with the idea that it might bemost effective for an individual philanthropist to invest and donate their income at a later
date, we also seem to find unintuitive the idea that one ought to take out a loan in order todonate even more now. Indeed, such an idea might even be regarded as fanatical. But if
there are strong arguments for donating now, then why should we be so surprised if thosearguments also motivate taking out a loan, at least when the interest rate is low?
Moreover, when it comes to government spending, it’s well accepted that a government
ought to borrow in order to be able to spend more earlier on social programs. Yet, to atleast some extent, the government doesn’t seem so different from a philanthropist: asignificant part of the government’s aim is to spend its budget in a way that will enhance
the living conditions of its citizens.
Perhaps there are real differences between philanthropists, career-seekers, foundations,and governments that explain why the commonly accepted answer to the question “Givenow or invest and give later?” is so different for each of them. But it’s hard not to suspectthat some sort of bias is at play, especially in the discrepancy between how charities
spend their money and how foundations spend their money. Perhaps we simply find thestatus quo acceptable and find any deviations from the status quo counterintuitive. Eitherway, the fact that we have different attitudes to giving now versus giving later acrossVentures and Giving Now vs. Later (2016 Update), Open Philanthropy Project Blog,
https://www.openphilanthropy.org/blog/good-ventures-and-giving-now-vs-later-2016-update.
3 Moller, Dan. "Should we let people starve–for now?." Analysis 66, no. 291 (2006): 240-247; Valentini,
Laura. "On the duty to withhold global aid now to save more lives in the future." Ethics & Global
Politics 4, no. 2 (2011).

different domains makes it particularly valuable to investigate the question of when is thesocially optimal time to spend money, for it may be that we come to revisionary
conclusions for one or more of those domains. Moreover, despite the importance of thisquestion, it has received very little academic attention from either philosophers or
economists.
In this chapter, I will canvass what I consider to be all the main considerations that are
relevant to whether an effective altruist ought to donate now or later, explaining what
each of these considerations do and do not entail. In section I, I discuss what I view as
relatively minor considerations, and in section II I move on to what I view as moresignificant considerations. In section III I will then propose a qualitative framework to
help determine, for a given cause, whether you should invest to give at a later date,whether you should give now, or whether you should take out loans in order to donate
even more now.

I. Minor Considerations
Tax
For individuals, it is generally more tax-efficient to give as you earn. In the UK, forexample, the Gift Aid scheme makes it easy for individuals to waive income tax on their
donations: simply by ticking a box, the government will add 25% onto the donation,
paying to the charity the income tax that was paid on the amount donated (if one is in thelowest tax bracket). However, the amount that the government will pay is capped at theincome tax one has paid over the last four years. So if one saves until one’s retirement
and then donates, and the amount to be donated is sufficiently large, one will not be able
to add the full 25% match from the government onto the donation.
However, this is not a strong consideration in favor of giving now, because one can easily
set up a donor advised fund (DAF) that enables one to donate one’s income immediately,
gaining the tax benefits, but only spend the money at a later date. For this reason, in myview, individual tax considerations do not provide a strong reason in favor of giving now.
For some people, tax considerations may provide a reason for giving later, if you will
predictably enter a higher tax bracket in the future. In this circumstance, one may be able
to donate a greater total amount if one waits until one enters that higher tax bracket,
because one would get greater tax relief at that time, which could also be donated.

Future weakness of will
Another potential argument in favor of giving now is the fact that you might not follow
through with your plans to give later; perhaps when you are older you might choose tospend the money you’ve saved on yourself instead. If so, then you should discount any

potential future returns on investment by the chance that you will keep the money for
yourself instead. 4
However, again you have the option to donate into a DAF. Because DAFs can only pay
out to registered charities, you can guarantee that you will not spend the money on
yourself at a later date. (The separate issue of whether you’ll change where you choose to
donate is discussed later, in the section on changing values.)
Though weakness of the will doesn’t provide an argument in favor of donating now, it
might provide an argument in favor of taking out a loan in order to donate even more
now. If there is a significant risk that you won’t donate more in the future, then taking out
a loan is a way of tying yourself to the mast, effectively turning what would be an
altruistic decision for your future self (to donate to charity) into a self-interested decision(to repay the loan).
What’s more neglected?
In general, because of diminishing marginal returns, one can do more to address a
problem the fewer funds that have already been put towards addressing that problem.
Over time, in the USA, charitable spending has stayed approximately constant at about
2% of GDP.5 However, average income is rising over time as the world gets wealthier, so
the amount of total charitable donations is increasing; in the US it has risen from $75
billion in inflation-adjusted dollars in 1975 to $410 billion in 2017. 6 This suggests that ingeneral, the sorts of problems one would address with charity will receive more money inthe future compared to what they receive now. This gives a mild consideration in favor ofgiving now.

Uncertainty

4 The relevance of weakness of the will to the question of giving now vs later is actually dependent on acontested normative assumption. According to actualism, you should take future weakness of the will into
account in your decisions. On actualism, weakness of the will is therefore relevant to the question of giving
now vs later. According to possibiliism, however, you should not take future weakness of the will into
account. Possibilism endorses (whereas actualism rejects) the rule of deontic logic on which Ought(A & B)
entails Ought(A) and Ought(B). Suppose it is true that you ought to both invest your money, and donate
those savings at a later date, but that, as a matter of fact, you won’t donate. According to possibilism,
Ought(Save now & donate later) entails Ought(Save now), and the fact that you won’t actually donate later
is irrelevant. I don’t dwell on this issue in part for focus and in part because I find actualism to be the far
more plausible position.
5 Havens, John J., Mary A. O’Herlihy, and Paul G. Schervish. "Charitable giving: How much, by whom, towhat, and how." The nonprofit sector: A research handbook 2 (2006): 542-567; Charity Navigator, ‘Giving
Statistics’, https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=42.
6 ‘Giving USA 2018: The Annual Report on Philanthropy for the Year 2017,’ Giving USA Foundation2018.

We don’t know for certain what the future will be like. Every year, it’s possible that somecatastrophe, such as an asteroid strike, a world war or huge depression, will end thehuman race, destroy civilization, or otherwise make one’s current income close toworthless. This ongoing risk gives a mild consideration in favor of giving now. The Stern
Review on the Economics of Climate Change, for example, incorporates a 0.1% annual
discount factor into their cost-benefit analysis as a modelling assumption that represents
the possibility of human extinction. 7

Self-interest
Saving money provides benefits to the saver, effectively providing insurance in the caseof major negative life events (such as unexpected illness or job loss) that require
emergency uses of money. Insofar as very few people give as much as would maximize
their altruistic impact, this gives a mild reason in favor of giving later.
For example, consider someone who faces the following two options:
A. Donate yearly, giving a total of $100,000 (inflation adjusted, i.e. in US 2019
dollars) over their lifetime.
B. Save during their lifetime, and donate $110,000 (inflation adjusted, i.e. in US2019 dollars) at the end of their life unless a one-in-a-hundred negative life event
occurs, in which case they spend the money on themselves.
It may be that the decision-maker prefers B to A on self-interested grounds — because
she’s happy to donate an extra $10,000, with 99% probability, in order to be able to notdonate in the 1% likely outcome of a major negative life event — and that B is better
than A on altruistic grounds, because B results in an expected $108,900 (i.e. 99% *$110,000) going to charity, whereas A results in an expected $100,000 going to charity.
So some ‘give later’ options could be better both in terms of self-interest and altruistism
than ‘give now’ options.
However, donating immediately has benefits, too. By being able to see the impact of yourdonation, you get a ‘warm glow’ that studies suggest improves happiness. 8 The personal
benefits of donating give a reason for spreading out your donation over the course of yourlife, rather than waiting until the end of your life. For this reason, I think that self-interest

7 Stern, Nicholas Herbert. The economics of climate change: the Stern review. Cambridge University Press,

2007.

8 Andreoni, James. "Impure altruism and donations to public goods: A theory of warm-glow

giving." The economic journal100, no. 401 (1990): 464-477; Dunn, Elizabeth W., Lara B. Aknin,
and Michael I. Norton. "Spending money on others promotes happiness." Science319, no. 5870
(2008): 1687-1688.

provides at most only a mild consideration either way (though the extent of thisconsideration will necessarily be person-dependent).

II. Major considerations
Valuing the present generation more highly
One reason you might have for preferring to donate now is that you value the interests ofpeople alive today over the interests of people in the future. 9
Moral philosophers typically argue that mere location in time provides no moral reason to
discount the interests of future people. If I placed a bomb in some woods and primed it to
go off in one hundred years’ time, knowing that it will kill a child who is not yet born,that action seems no less wrong than if I were to prime the bomb to explode and kill achild in one week’s time.
However, there might be relevant moral considerations that correlate with temporal
location, even if they are, morally speaking, independent of it. For example, many people
believe that they have a greater duty to their co-nationals than they have to strangers,
perhaps because they are in a reciprocal relationship with co-nationals, receiving benefits
from the government that are paid from taxes of co-nationals. If this gives a reason for
preferring to help one’s co-nationals than to help people in other countries, then it would
also provide a reason for helping co-nationals that are alive today than co-nationals in the
future.
One might think that the idea that some people’s interests count for more than others isabsurd, and therefore want to reject this consideration out of hand. But that would be too
hasty. In other work, 10 I have defended the idea that, given the uncertainty we face about
which moral view is correct, rather than simply following the moral view that we think ismost likely to be right we should instead look at all the moral views that we have somedegree of confidence in, and take the action that represents the best ‘hedge’ between
those views. More precisely, I argue that we should maximize expected choiceworthiness, where the expected choice-worthiness of an option is given by the sum, overall possible moral views, of the product of one’s credence in each moral view and the
choice-worthiness of that option if that moral view were true.

9 Note that if one were to act on this consideration, one would be departing from pure effective

altruism, which treats all individuals’ interests equally.
10 MacAskill, William, and Toby Ord, “Why maximize expected choice-worthiness?”, Nous, 2018;
MacAskill, William, “Practical Ethics Given Moral Uncertainty,” Utilitas, 2019.

If this is true, then any reasonable person should place some extra weight on the interestsof those to which one has a special relationship. This is because you should have somedegree of confidence that all people’s interests should be treated equally, and somedegree of confidence that you should weight the interests of those to whom one has
special relationships more heavily; both are popular views. However, you should havealmost no credence in the idea that you should weight the interests of strangers moreheavily than you weight the interests of friends, family or co-nationals. In which case, if
you take an expectation over all moral theories in which you have some degree ofconfidence, then you will give some additional weight to the interests of people to whom
you have a special relationships; you should give them a weight in between that given tothem by the ‘special obligations’ view and the ‘impartiality’ view. Exactly how muchweight depends on the level of credence that one gives to the view that special
relationships do matter morally. Personally, I have a fairly high degree of belief thatwhen it comes to philanthropy we should be impartial across all creatures, so thisconsideration does not affect my decisions too greatly. But others may have different
views.

Changing opportunities
The opportunities that you will have for making an impact will change over time. If thecost-effectiveness of the best opportunities available to you is decreasing over time, thenthat provides an argument for giving now (or taking out a loan to give more now). If thecost-effectiveness of the best opportunities available to you is increasing over time, thenthat provides an argument for giving later.
The world is getting richer. Over the last 25 years, PPP-adjusted per-capita GDP has
increased from $5410 to $15,500 — a rate of 4.3% per year. 11 In that same time, thenumber of people living in extreme poverty has decreased from 1.9 billion to only 1billion, even though in that time the total world population increased by 35%. 12
The fact that the world is getting richer means that in general the best giving
opportunities will be drying up, because it means that those who are potential recipientsof philanthropy are less badly off. They will have solved the most pressing of their own
problems. And, in general, the better off someone is, the more resources it takes to givethat person a given amount of benefit.
However, it is not true for every problem that a philanthropist might want to tackle that
we’re making progress. The real income of the poorest 20% of families in the US hasbarely increased since 1970;13 nor has real GDP per capita increased since 1980 in some
11 http://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?end=2015&start=1961&view=chart; data isfrom 1990 to 2015.
12 https://ourworldindata.org/world-poverty/#poverty-by-world-regions-in-absolute-numbers; data is from1990 to 2011.
13 http://www.cbpp.org/research/poverty-and-inequality/a-guide-to-statistics-on-historical-trends-inincome-inequality

of the world’s poorest countries, such as Central Africa Republic, Liberia or Niger. 14
Moreover, some global problems are a result of our increasing prosperity. The amount of
ecological destruction and species loss increases as population grows and as more
greenhouse gases are emitted. The number of animals raised for food increases every
year: in the US the number has increased from 1.8 billion animals in 1960 to 9.2 billion
in 2015.15 In these cases, we should expect to see less of an effect of the best
opportunities decreasing over time.
A second way in which the cost-effectiveness of the best opportunities might change overtime is based on the amount of resources going into a particular cause-area. If the amountof resources dedicated to tackling a problem is increasing, then, other things being equal,
the cost-effectiveness of the best interventions available will decrease; if the amount of
resources dedicated to tackling a problem is decreasing, then, other things being equal,
the cost-effectiveness of the best interventions available will increase. This is because,
when the amount of money flowing into tackling a problem increases, that spending will
use up the room for more funding of the most effective interventions. For example,
smallpox was the first disease to be eradicated; it was also significantly easier to eradicate
than other diseases, because every infected person shows signs of infection, those signs
are very distinctive, the initial appearance of symptoms occurs relatively soon after
infection, there is only a human reservoir, and the smallpox vaccine was highly effective
and did not require refrigeration. This exceptionality of smallpox is even more glaring
when we consider the cost-effectiveness of the eradication effort: it was comparatively
easy to eradicate, yet it was the disease that has killed the most people ever. It cost only
$1.6 billion in today’s money, saving between 60 and 120 million lives—a costeffectiveness of $27 per life saved. In contrast, efforts to eradicate other diseases such aspolio and measles have proven to be more difficult and more expensive.
This consideration is even stronger when we consider increases in resources that arevalue-aligned: that is, where the donors in question do not just support your preferredcause, but also share your values and general worldview. In this case, if you conclude thata particular cause or intervention isn’t that promising, or if you discover a new cause orintervention that is particularly promising, then other donors who share your values andworldview are reasonably likely to support that too. When there is other donor moneythat is value-aligned, you should think of your spending as acting in harmony with therest of the value-aligned money. If you think that the amount of value-aligned money isgoing to significantly increase over time, that gives an argument from diminishingmarginal returns in favor of giving more now. If you think that the amount of valuealigned money is going to significantly decrease over time, that gives some reason for
donating later.
A second line of thought relating to how the cost-effectiveness of the best opportunities
might change over time is that entirely new opportunities might arise. For example, gene
drive technology has recently been developed, potentially giving us the opportunity to
14 http://data.worldbank.org/indicator/NY.GDP.PCAP.CD
15 http://www.humanesociety.org/news/resources/research/stats_slaughter_totals.html

completely eradicate malaria for what in global terms would be a very small amount ofmoney. Of course, whether the use of gene drives to eradicate malaria is feasible and safe
is still an open question. But suppose that it were discovered to be safe and feasible. Inthat case, donors would have an entirely new funding opportunity; if it were the case thatthe funding opportunity were open, it would be possible that those who are interested in
donating to prevent deaths from malaria would have been able to do more good by saving
their money to donate to the gene drive-based eradication effort than by donating to acharity like Against Malaria Foundation that distributes bednets.
Similarly, new organizations might come into existence. Perhaps there is some programthat is known to be more effective than any other, but no existing charity that implementsthat program. In which case, it might be best to save in order that, if and when a charity
comes into existence that implements that program, one can fund it.
So we have two effects: the world is getting richer, which decreases the costeffectiveness of the best interventions; but we are making technological andorganizational progress, which generates new opportunities for doing good. It’s difficult
to know which effect is more important, but my guess is that it’s the former. When we
look at the history of philanthropy’s successes, many occurred decades ago, when thelowest-hanging fruit had not been picked: examples include Rockefeller’s funding for
short-stem disease-resistant wheat that precipitated the Green Revolution; Katherine
McCormick’s funding of the contraceptive pill; and the funding behind smallpox
eradication.
One possible strategy, however, is what I’ll call “watch then pounce”. On this strategy,
you invest your money rather than spend it, watching to see if any new unusually costeffective opportunities arise. When an unusually cost-effective opportunity does arise,
you then completely fill that organization’s room for more funding. This is a strategy that
could be optimal even if, on average, the best opportunities were decreasing in costeffectiveness over time.
For example, consider a very simple model where the starting cost-effectiveness of thebest donation opportunity is 1. Every year you think it’s 10% likely that some newopportunity will arise. If the new opportunity does arise, you will be able to fund that
opportunity, which has a cost-effectiveness of 2. If the new opportunity doesn’t arise,then the cost-effectiveness of the best donation opportunity will decrease by 20%.
Now suppose that you choose the ‘watch then pounce’ strategy. You save your money on
the possibility that the new opportunity arises, then fund that opportunity when it does.
After 7 years, there’s a cumulative 52% probability of a new opportunity arising, so the
expected value of waiting for 7 years and funding the new opportunity if and when it
comes along is 0.52*2=1.04, which is greater than the expected value of simply donating
immediately (which equals 1). The expected value of ‘watch then pounce’ increases
indefinitely, so if you can wait for 7 years or more, the ‘watch then pounce’ strategy does
better than donating immediately. This is so even though the expected cost-effectivenessof the best donation opportunity is always decreasing.

It can therefore make sense to invest and give later even if cost-effectiveness isdecreasing over time, depending on how quickly one thinks that cost-effectiveness overtime is decreasing, and how much variance there is in the downward trajectory of costeffectiveness over time. If cost-effectiveness is only decreasing slowly, or if variance ishigh, then it can make sense to wait until some new outstanding giving opportunity
arises.

Getting better knowledge
Another consideration is how one’s state of information about different giving
opportunities will change over time. Whereas the previous consideration related to how
good one’s opportunities are, this consideration relates to how good one is at identifying
good giving opportunities. All other things being equal, if you have more knowledge of
the world, then you’ll be able to do better at finding the best giving opportunities.
Our ability to identify the best giving opportunities has certainly increased over time.
Over the past two decades, there has been a rise in the use of randomized controlled
trials, social science in general has progressed, and new rigorous charity evaluators such
as GiveWell have been founded. For almost everyone, this progress happens
independently of one’s donations; you get the new information almost for free. All otherthings being equal, therefore, it would make sense to wait as one’s ability to pick themost cost-effective interventions improved in light of one’s improved epistemic state.
It’s unlikely that one’s state of information will get worse over time. So in general thisconsideration should only push us in the direction of investing to give later. However,sometimes it might be the case that one can gain new information by giving now. You
can do this by funding research, or by funding a fledgling non-profit to give it thecapacity to provide you with more information, or as a way of gaining access toorganizations that you might not otherwise have access to.

Values changes
A similar consideration to one’s state of knowledge is how one’s values might changeover time.
It’s an interesting philosophical issue to what extent we should trust the values of our
future selves. Most of us would agree that you should trust the views of your future self
over your own when it comes to empirical beliefs, at least absent brain injuries or any
other mitigating conditions, and on the assumption that your future self has had moretime to investigate the issue than you have. But when it comes to values, people tend to
be more uneasy. It’s a common trope that people become more conservative over time,and suppose that you knew that in the future you would be significantly moreconservative than you are today. Should this affect your decision about whether to givenow or later? On the one hand, you might think that your future self has had more time toreflect and listen to new moral arguments, and therefore is in a better position to come toa set of values than you are today; on this view, the fact that your values might changeover time provides a reason for you to invest, so that you can spend the money in a way
that’s more in line with the correct moral view.
On the other hand, you might see this as ‘value-drift’, providing a reason for you todonate sooner; on this view, it’s your current values that you should try to optimize for,even if your future self has had more time to reflect. On this view, you should give now,or even take out a loan in order to prevent your future self from spending their money in apoor way.
My own view is that we should defer to our future selves on our values, if it’s the casethat we think that their values are the result of ‘good’ processes, such as careful
reflection, discussion with peers, consideration of moral argument, and so on. There are,however, many value-changes that are the result of bias, or cognitive decline, or
personality changes, rather than of genuine reflection. For example, if as your income
increases you were to come to the view that there are no strong altruistic obligations, thenyou might justifiably suspect that your future self’s moral views have been biased by selfinterest.

Investment returns
The final consideration we’ll discuss is the rate of return that you can get by investing themoney. The real rate of return of the S&P over the last hundred years has been about 7%;
this is almost certainly higher than the expected return one can get going forward(because the S&P did unusually well in this time period, and there may be some verysmall annual chance of catastrophic losses that are not captured by one hundred years ofdata). However, the rate of return on investment is always positive on average, and so by
investing the money in an index fund or other vehicle, you can therefore ultimately
donate a much larger amount of money than you started with. This may seem like asimple consideration in favor of giving later. But the reality is actually fairly complicated.
It’s been argued that, just as one gets a financial return from investing one’s money, onegets a social return by donating;16 making the extreme poor richer, for example, hascompounding effects, both because making one person richer enables them to be more
economically productive and because that person spends some of their money on assets,
which themselves generate a return. Moreover, it’s been argued that the rate of this social
return is much greater than the rate that one can get by investing in the stock market. The
existing studies suggest annual investment returns in the order of 7%-48% for iron roofs,

16 http://blog.givewell.org/2011/12/20/give-now-or-give-later/

30%-39% for unconditional cash transfers, 18%-21% for conditional cash transfers17 and15-30% for donations targeting contagious diseases.18
If this were the correct analysis, then it would provide a strong argument for giving now.
However, this analysis is not correct. If you were investing to give later, then you would
reinvest any financial returns you got in whatever was the highest-return investment. In
contrast, you do not have control over the additional money generated by the social
return; that money is in the hands of the beneficiaries, who are very unlikely to reinvest
their gains in whatever has the highest social return. Instead, the positive effects of yourdonation spread out more and more over time, until eventually those effects will grow at
the rate of world economic growth. The world growth rate, at about 2.25% per year, islower than the rate of return that you can get from your investment.
Because of this, it doesn’t make sense to think of social return as something thatcompounds over time. Though you should think of the indirect benefits of your donation
as increasing the total value of your donation, you should think of it as a fixed benefit.
The social rate of return doesn’t provide an argument in favor of giving now, because it
doesn’t matter when the donation happens; you’ll get similar indirect benefits from the
donation either way.
However, the social rate of return might provide a consideration in favor of giving earlier
if it’s true that the rate of the social rate of return is going down over time. This may betrue; if so then, in effect, it adds another wrinkle to the idea that the best giving
opportunities are disappearing over time. If, for example, the best investment
opportunities for the very poorest are drying up over time, and the multiplier effect is alarge component of the total good that you do through your donation, that may mean thatthe most cost-effective opportunities are disappearing even faster than you mightotherwise think.
It’s also worth noting that, for some cause areas, there is not social compounding of thebenefits of one’s donation at all. If one donates to mitigate species loss, or protect thenatural environment, or to rescue animals from factory farms, then there may be no social
compounding effect.
So far, I’ve suggested that the idea of social rate of return does not provide an argument
either way for giving now or later. This crucially relied on the assumption that the returns
from the donor’s giving are not captured by the donor, so they can’t be reinvested in thebest giving opportunities.
Interestingly, however, there is one sort of social return where you can ‘capture’ thedonation. This can happen if an organization is dedicated to fundraising (a ‘meta17 http://www.givewell.org/international/technical/programs/cash-transfers#Whatreturnoninvestmentdocashtransferrecipientsearn
18 Molyneux, David H. "“Neglected” diseases but unrecognised successes—challenges and opportunities
for infectious disease control." The Lancet 364, no. 9431 (2004): 380-383.

charity’) and raises at least $1 with every $1 it spends on fundraising. If so, then theorganization functions like an investment vehicle, but where the money can often get a
far higher return than it can in a typical financial investment. For example, Giving What
We Can (disclaimer: which I cofounded and run), is an organisation that encourages
people to pledge to give at least 10% of their income to the most cost-effective charities,
and has over its lifetime raised millions of dollars for those charities. Its very lowestbound estimate is that every $1 donated to Giving What We Can results in $6 donated to
top-recommended charities (its best-guess estimate is that every $1 donated to it results in$100 of value to top-recommended charities). 19 If the money that it raised were simply
directed to global poverty charities, then the fact that it acts as a multiplier on yourdonation would not give an argument for giving now rather than later. However, asignificant proportion of the money it raises is subsequently donated back to Giving What
We Can, which can then be used for further fundraising. As long as you believe that thedonors that Giving What We Can raises money from have similar values and worldviews
to you, or even if not will donate to similar charities that you would choose to donate to,then you are in effect gaining more money to donate later. You might not possess thatmoney yourself, but it will be used in a similar way to how you wanted to use it.
Of course, this argument relies on there being such opportunities available. If donating toa meta-charity really can get such a great return, then many other people will also want todonate to that charity, and the available room for more funding may get used up.

III. A qualitative framework
In the previous two sections, we canvassed a number of considerations that impacted thedecision to give now or save and give later. We found considerations relating to tax
efficiency, future weakness of will, neglectedness, uncertainty and self-interest werefairly minor, but considerations relating to special obligations, changes in opportunities,
knowledge and values, and investment returns were more major.
In this section I propose a qualitative framework that encodes the major considerations,as follows:

Consideration
Special relationships

Score

Changing opportunities

19 https://www.givingwhatwecan.org/impact/

Score Explanation
1 = special relationships topeople now
4 = no special relationships
7 = special relationships topeople in the future
1 = better opportunitiesnow
4 = no change in quality ofKnowledge

ValuesMovement-growth

Amount of money to donate

opportunities
7 = better opportunities in
the future
1 = better knowledge now
4 = no change inknowledge
7 = better knowledge in the
future1 = better values now
4 = no change in quality ofvalues
7 = better values in the
future1 = donation creates many
more like-minded donors
3 = no effect
7 = donation decreases thenumber of like-mindeddonors
1 = total real value of yourmoney to donate will
significantly decrease overtime
4 = total real value of yourmoney to donate will staythe same over time
7 = total real value of yourmoney to donate will
significantly increase overtime

In this framework, I propose that under “amount of money to donate” we bundle
considerations relating to taxes, weakness of will and uncertainty as well as financial
investment. Each of these considerations simply affects how large the total amount ofmoney to be donated is; whereas the other considerations, in different ways, affect how
valuable the expected donation opportunity is. That’s why the idea that the total realvalue of money assigned to donations might decrease over time is not an idle one: if
weakness of will is a real concern (and a DAF is not an option), or if it’s more tax
efficient to give now (and again a DAF is not an option), or if one is considering thequestion at an unfortunate point in time (such as during hyperinflation), then one would,
in effect, have more money to donate now rather than later.
On this framework, a total score of 24 would indicate indifference to giving now versus
giving later. A score of less than 24 would indicate that in general the arguments favor

giving now. A score of greater than 24 would indicate that in general the arguments favor
giving later.
However, because this framework is purely qualitative you shouldn’t put much weight on
the total scores: the framework should be thought of as a way of thinking through therelevant considerations, rather than giving you a determinate answer. If, for example,
we’d carved “amount of money to donate” as several different considerations —“investment opportunities”, “weakness of the will”, “tax efficiency” and so on — then,because each consideration is currently equally weighted, we would start weighing the“amount of money to donate” consideration several times as highly as we do in myframework.
It is my hope that future work can build on this chapter and develop a quantitative model,
which could, at least in principle, give a determinate answer to the question of whether
one ought to give now or later, for a given set of inputs. For the time being, I’d encourage
each user of the framework to assign their own weights to each of the relevant
considerations. If, for example, you think that values change is a particularly importantfactor, then you should weight that consideration more heavily than the otherconsiderations.
If we were to make this framework quantitative, what might we find about the weights ofthe different considerations? It’s plausible to me that the final term — amount of money
to donate — is actually the least important part of the equation, even though it’s the onethat tends to get the most attention in discussion of giving now versus later (perhaps
because the most quantifiable). Even using a 7% real rate of return, over thirty years,
investing one’s money increases the value of one’s donation by only 7.5x. At 5% real
return over thirty years, the increase in financial value of one’s donations is only 4.3x.
However, changes in the expected cost-effectiveness of one’s donations, whether throughchanging opportunities, knowledge, or values, can be much larger. Let me illustrate.
Opportunities and knowledge
It’s plausible that the differences in cost-effectiveness between social programs can varyby a factor of tens or hundreds; paying for bednet distribution via a donation to Against
Malaria Foundation is estimated to have a cost per life saved of $3500,20 whereas themarginal expenditure to save a life in the US by the government is about $7 million. 21 If
we value all lives equally, then, for someone who is initially focused on lifesaving
programs in the US, the value of the information that they could instead save lives byfunding bednets is vast. And if there is such a large discrepancy between domestic
lifesaving programs and international lifesaving programs, then perhaps the discrepancy
between global health and some other cause area might also be very great.

20 http://www.givewell.org/charities/against-malaria-foundation
21 MacAskill, William. Doing Good Better: Effective Altruism and a Radical New Way to Make a

Difference. Guardian Faber Publishing, 2015.

It’s difficult to know how likely it is that we might make such discoveries. But our
understanding of the most cost-effective programs is still in its infancy, the result of only
a couple of decades of work. It’s not implausible to me that we could very significantly
improve our knowledge over time.

Special relationships and values
The additional weight you give to the interests of those you have special obligations to is
an important factor in the equation. Non-consequentialist views on which special
relationships have moral value can easily weight the interests of family, friends, or conationals one hundred times as much or more as the interests of distant strangers. The
ability to spend money to help those to whom one has a special obligation would
therefore matter far more than the additional total amount of money one could donate if
one saved in order to donate.
The potential for one’s values to change over time is similarly important. For example,
suppose that you currently value the interests of co-nationals one hundred times asheavily as the interests of people in other countries; for that reason, you think that thebest domestic giving opportunities are about as cost-effective as the best giving
opportunities to help the very poorest people in the world. However, suppose that you
were to change your mind, and regard the interests of people living in other countries tobe just as important as the interests of people living in one’s own country. In which case,the best giving opportunities would now provide one hundred times as much value, witha given amount of resources, as you thought before.
Or suppose that you currently endorse a person-affecting view of population ethics, on
which there is no value to creating new flourishing lives. For that reason, you think that
global poverty is a more important area to focus on than mitigating the risk of humanextinction. However, if you were to change your view and adopt the total view of
population ethics, then you would come to believe that efforts to mitigate extinction risk
were more important; moreover, because human extinction would involve the loss ofhundreds of trillions of lives in the future, efforts to mitigate human extinction now,
given that the total view is correct, would provide hundreds or thousands of times morevalue with a given amount of resources than efforts to improve the lives of people inpoverty.
Again, therefore, the potential discrepancy in the amount of money one can donate overtime is small compared to the possibility that you will rationally change your moral
views.

Conclusion
In this chapter I canvassed all the significant considerations that I know of that are
relevant to the question of whether to give now or later. The most importantconsiderations, in my view, are: whether one has the opportunity to invest in movementgrowth, and how good that opportunity is; the extent to which the amount of resources
flowing into one’s favored cause is increasing; to what extent one should expect one’s
ability to pick the most effective programs will improve over time; and to what extent
one should expect one’s values to improve over time.
Further work in this area would: (i) develop the qualitative framework that I haveproposed into a quantitative framework; (ii) apply this framework to a variety of different
cause-areas; and (iii) apply this framework to the cause-neutral donor — someone who is
open to donating to any problem, and simply wishes to maximize the amount of goodthey do.