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Today is the fifth annual Giving Tuesday, a day when thousands of charities ask us to open our wallets, although that does require some thought. How can you be sure that the group you donate to is effective and that you're getting the most bang for your charity buck? NPR's Nurith Aizenman reports.
NURITH AIZENMAN, BYLINE: Some years ago, Elie Hassenfeld and a buddy at this hedge fund they both worked at decided they wanted to give money to charity. But being numbers guys, they wanted evidence of which groups could offer the biggest impact per dollar.
ELIE HASSENFELD: We were shocked by how little useful information was available.
AIZENMAN: Sure, there are rating sites that let you check how much a charity spends on overhead, any red flags pointing to corruption.
HASSENFELD: But nothing that said, this is how much a charity can accomplish with the donation that you get.
AIZENMAN: And so, in 2007, Hassenfeld and his friend, whose name is Holden Karnofsky decided to start a nonprofit called GiveWell. The mission - come up with an annual shortlist of charities they can recommend based on scientific evidence.
HASSENFELD: Randomised control trials of, for example, distributing malaria nets in Africa to see how effectively that reduces cases of malaria and save lives.
AIZENMAN: Turns out passing out cheap bed nets against malaria-carrying mosquitoes saves a lot of lives. And that puts Against Malaria Foundation at the top of GiveWell's picks for 2016. Their next choice?
OK, I'm looking at number two. Schisto - I think I'm going to mispronounce this.
HASSENFELD: (Laughter). Schistosomiasis - it's an intestinal worm.
AIZENMAN: It affects a lot of kids in sub-Saharan Africa, causing cognitive and physical development problems. HASSENFELD says Schistosomiasis Control Initiative can deworm a kid for just 50 cents.
HASSENFELD: So a very small amount of money may have really large, long-term effects.
AIZENMAN: The thing is, social science research suggests, if you tell us about one child who needs our help, we're sold. Rattle off statistics about an obscure disease in some far-away place, and a lot of us start to feel overwhelmed and, frankly, turned off. Hassenfeld doesn't disagree, but he says...
HASSENFELD: We're trying to reach a particular type of person who's just thinking about their charitable giving in a very different way.
AIZENMAN: And in just nine years, GiveWell has convinced about 14,000 people to donate a total of more than $100 million to the charities it's selected. Still, at least one of those charities is starting to rethink the database to pitch for donations. It's a fairly new group called GiveDirectly. Ian Bassin manages donor relations.
IAN BASSIN: We are asking people to do something that, I think, most people instinctively, psychologically are resistant to.
AIZENMAN: Basically, GiveDirectlly wants to take your cash and just hand it over to an extremely poor person - no strings attached. The beneficiary can spend the money however he or she sees fit. Why? Well...
BASSIN: It turns out that rigorous scientific evidence over the last 10 to 15 years has shown that actually giving people the power of choice to decide what their priorities are is one of the most effective ways to help the poor.
AIZENMAN: GiveDirectly was founded by a bunch of economists who were inspired by this research. And at first, they wanted to make their case to donors just on the numbers. They were determined to avoid what Bassin calls poverty porn.
BASSIN: You know, people sort of putting a picture of a starving child on a video and, you know, infomercial.
AIZENMAN: In five years, they've raised more than $130 million. But a few days ago, they unveiled a new feature on their website. It's a running list of photos and profiles of the beneficiaries because now they want to reach a broader audience.
BASSIN: There's a limit to how many sort of of the wonky, evidence-type-based donors that we could have.
AIZENMAN: And often, Bassin says, people's charitable giving is a connection between the head and the heart. Nurith Aizenman, NPR News.
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