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Counterfactual marginal dollars are allocated to what level of cost-effectiveness?
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Scenario 1: 5x cashScenario 2: 2x cashScenario 3: 7.5x cashScenario 4: 10x cashNotes
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Probability of scenario25%5%55%15%Forecast
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Cost to generate information to reallocate$3,853,341$3,853,341$3,853,341$3,853,341
Endline RCT costs (excludes midline and earlier) plus cost of additional operational grant to New Incentives
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Probability that NI is <5x cash50.0%50.0%50.0%50.0%
Only illustrative. Not directly used in calcs below.
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Probability that NI is ~5x cash27.5%27.5%27.5%27.5%Forecast
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Probability that NI is ~7.5x cash17.5%17.5%17.5%17.5%Forecast
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Probability that NI is ~10x cash5.0%5.0%5.0%5.0%Forecast
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Total100.0%100.0%100.0%100.0%
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New Incentives Annual RFMF$20,000,000$20,000,000$20,000,000$20,000,000
An informed guess - NI's current stated operating budget is ~$3 mil/year, but it has the potential to scale up significantly after the RCT while remaining within Northwest Nigeria. NI told us in a 7/3/2019 call that it projects that it can absorb $21 million/year in funding if it fully scales the program in the three states in North West Nigeria in which it currently works. We've rounded this down to $20 million because NI may eventually find some funding from sources outside of GiveWell.
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% of total RFMF that is reallocated to New Incentives75.00%75.00%75.00%75.00%
Assumption - it's unclear how much funding we'll have available to allocate at the margin, and in some cases we may redistribute funding based on qualitative factors & organizational competency
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Amount of money reallocated per year$15,000,000$15,000,000$15,000,000$15,000,000Assumption
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Baseline cost per under-5 life equivalent saved$2,460$6,149$1,640$1,230
Rough estimate for cost-effectiveness of counterfactual charity
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Alternative cost per under-5 life equivalent saved, NI is ~5x cash$2,460$2,460$2,460$2,460
Rough estimate for ~5x cash
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Alternative cost per under-5 life equivalent saved, NI is ~7.5x cash$1,640$1,640$1,640$1,640
Rough estimate for ~7.5x cash
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Alternative cost per under-5 life equivalent saved, NI is ~10x cash$1,230$1,230$1,230$1,230
Rough estimate for ~10x cash
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For how many future years will we fund New Incentives?10101010Assumption
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Discount rate5.00%5.00%5.00%5.00%Assumption
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Net present value of money reallocated$121,617,325$121,617,325$121,617,325$121,617,325Calculation
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Under-5 lives saved, baseline, for amount of money reallocated49,44619,77874,16998,892Calculation
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Under-5 lives saved, alternative, for amount of money reallocated if NI is ~5x cash49,44649,44649,44649,446Calculation
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Under-5 lives saved, alternative, for amount of money reallocated if NI is ~7.5x cash74,16974,16974,16974,169Calculation
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Under-5 lives saved, alternative, for amount of money reallocated if NI is ~10x cash98,89298,89298,89298,892Calculation
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Under-5 lives saved by reallocating to alternative*Probability of reallocating [expected lives saved from reallocation], if NI is ~5x cash08,15900Calculation
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Under-5 lives saved by reallocating to alternative*Probability of reallocating [expected lives saved from reallocation], if NI is ~7.5x cash
4,3279,51800
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Under- 5 lives saved by reallocating to alternative*Probability of reallocating [expected lives saved from reallocation], if NI is ~10x cash
2,4723,9561,2360Calculation
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Total expected additional under-5 lives saved by reallocating under each counterfactual scenario6,79921,6331,2360Calculation
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Cost per under-5 life saved, generating information$567$178$3,117$3,853,341Calculation
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Cost per under-5 life equivalent saved, GiveDirectly$12,298$12,298$12,298$12,298
Value from the GiveWell's 2019 CEA version 4: https://docs.google.com/spreadsheets/d/1_bNbnVaAUQSq4fIzGBU_wVWojmwZrvQKzjSRx92y6wc/edit#gid=1680005064&range=B29
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In this scenario, generating information is X times more cost-effective than cash21.7069.043.950.00Calculation
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Overall: Generating information is X times more cost-effective than cash11.0
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What % of total benefits is coming from each scenario?49%31%20%0%100%
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