First, at Malengo the students fully fund the next cohort via repaying the original donation in an ISA.
This means that funding 1 student will actually fund many students over time. Using the numbers above you get a rate of return around 6% annualized. So funding a student is sorta infinite students 0% discount rates. But that is unreasonable, so let’s just cap at the next 100 years and say 2% discount rate from inflation.
BOTEC for 1 funding pays 12.5 students or a student every 8 years.
That changes your calculation from 3x givedirectly to 37.5x.
Second, you also said the students are richer but that is factually incorrect, the program is means testing to ensure that students are well targeted.
Finally, there are other fudge factors, but they are all dwarfed by the development benefits of immigration.
First, at Malengo the students fully fund the next cohort via repaying the original donation in an ISA.
This means that funding 1 student will actually fund many students over time. Using the numbers above you get a rate of return around 6% annualized. So funding a student is sorta infinite students 0% discount rates. But that is unreasonable, so let’s just cap at the next 100 years and say 2% discount rate from inflation.
BOTEC for 1 funding pays 12.5 students or a student every 8 years.
That changes your calculation from 3x givedirectly to 37.5x.
Second, you also said the students are richer but that is factually incorrect, the program is means testing to ensure that students are well targeted.
Finally, there are other fudge factors, but they are all dwarfed by the development benefits of immigration.
https://www.nber.org/papers/w29862
This shows that nearly 80% of long-run income gains are accrued within sending countries across a wide variety of channels.
Hence, I think 37.5x GiveDirectly is a completely reasonable estimate.