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ALEX CHADWICK, host:

Back now with DAY TO DAY. I'm Alex Chadwick. The ever-expanding Internet search engine is launching yet another new project. This time it is a billion-dollar charity organization that aims to fight issues like poverty and global warming. But as you might expect from Google, there is a twist. MARKETPLACE's Amy Scott is here. Amy, what is it about Google.org?

AMY SCOTT: Well, don't let the .org fool you. This is a for-profit company. Google has had what it's has called a philanthropic arm for a few years now, but the New York Times reported today that Google has hired an executive director, Silicon Valley entrepreneur and physician Larry Brilliant. It's committed a billion dollars in seed money, and it will keep its for-profit status.

CHADWICK: So why do this? Why not just start a private foundation like Bill and Melinda Gates, for instance?

SCOTT: Well, there are a couple of reasons. Because non-profits don't have to pay taxes, the IRS heavily regulates what they can do. They can't make certain types of investments, they can't lobby Congress. Google.org, on the other hand, will be able to fund start-up companies and lobby politicians. In his interview with the Times, executive director Larry Brilliant likened it to playing the entire piano keyboard rather than being confined, you know, to the upper register. Of course there are some downsides. I talked with Paul Light, who teaches public service at New York University. He says not only will Google.org have to pay taxes, it will also be subject to shareholder pressure.

Mr. PAUL LIGHT (New York University): If Google somehow comes under fire or somehow loses significant market share, then you would expect shareholders to demand that they not put this money into a foundation, and that's often why businesses don't.

SCOTT: Then again, most businesses aren't Google. This is a company whose stock is now worth more than $400 a share. Shareholders seem pretty content at this point.

CHADWICK: Well, what does Google.org plan to start out doing?

SCOTT: One of the projects is apparently to design a super-efficient car engine that runs on electricity, ethanol and gasoline. The company has already been working in India fighting blindness and promoting literacy. And you know, you can see this as a great PR move by doing all of this under the Google brand rather than a separate, private foundation. But one observer told MARKETPLACE if you're getting potable water to children in Kenya, does it really matter where the money's coming from?

And coming up later today on MARKETPLACE, we'll go inside the brain to learn how people make economic decisions, and apparently we're not quite as rational as we might think.

CHADWICK: I didn't actually think we were. But anyway, thank you.

(Soundbite of laughter)

CHADWICK: Amy Scott of public radio's daily business show MARKETPLACE, produced by American Public Media.

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