Inspired by the recent discussion on the cost-effectiveness of deworming and GlaxoSmithKline’s pledge to provide albendazole (a main deworming drug) until the eradication of lymphatic filariasis, I am wondering how others’ donations should be considered in EA-related cost-effectiveness analyses.
Deworming example:
According to GiveWell’s office hours, the cost of the manufacturing a deworming drug is added to the total cost of the program. The counterfactual impact of the drug’s cost (if spent by the donor otherwise) is subtracted from the total impact.
For the SCI Foundation cost-effectiveness analysis, leverage and funging[1] adjustments include the drug cost (e. g. $0.32/person/year[2]) that would have otherwise provided 0.005 units of value per dollar[3] (counterfactual value adjustment).
Would it make more sense to exclude the drug cost from the analysis, since GSK seems to be motivated by the WHO and actors other than EA-related donors (the company would have donated albendazole counterfactually[4])?
Is there a reason to include the drug cost on the total cost side (rather than leveraged benefit, negative cost side)?
Should the “[c]ounterfactual value of spending from non-philanthropic actors (units of value per dollar)”[5] be much more than 0.005? The value of the analyzed SCI Foundation deworming program is 0.045.[6] GSK, a major drug donor could otherwise spend on researching a vaccine or treatment to an additional high-burden infectious disease (currently, 13 diseases are targeted). Due to the very high impact of preventing or eradicating a disease, the value of developing a vaccine, to which GSK is uniquely advantaged, could be comparable to or larger than the effects of providing deworming drugs per unit dollar.
Question elaboration based on the example:
How should others’ donations be taken into account in EA-related cost-effectiveness analyses?
When should others’ costs be added to the total costs?
When should (the absolute value of) others’ costs be added to the total benefits (as leveraged funding)?
How can the impact of others’ costs be estimated accurately?
Should the expected impact of profit gained due to market provision of another impact be included in an analysis? (For example, if GSK profited from selling deworming drugs and invested this profit into researching a malaria drug.)
[Question] How should others’ donations be accounted for in cost-effectiveness analyses?
Inspired by the recent discussion on the cost-effectiveness of deworming and GlaxoSmithKline’s pledge to provide albendazole (a main deworming drug) until the eradication of lymphatic filariasis, I am wondering how others’ donations should be considered in EA-related cost-effectiveness analyses.
Deworming example:
According to GiveWell’s office hours, the cost of the manufacturing a deworming drug is added to the total cost of the program. The counterfactual impact of the drug’s cost (if spent by the donor otherwise) is subtracted from the total impact.
For the SCI Foundation cost-effectiveness analysis, leverage and funging[1] adjustments include the drug cost (e. g. $0.32/person/year[2]) that would have otherwise provided 0.005 units of value per dollar[3] (counterfactual value adjustment).
Would it make more sense to exclude the drug cost from the analysis, since GSK seems to be motivated by the WHO and actors other than EA-related donors (the company would have donated albendazole counterfactually[4])?
Is there a reason to include the drug cost on the total cost side (rather than leveraged benefit, negative cost side)?
Should the “[c]ounterfactual value of spending from non-philanthropic actors (units of value per dollar)”[5] be much more than 0.005? The value of the analyzed SCI Foundation deworming program is 0.045.[6] GSK, a major drug donor could otherwise spend on researching a vaccine or treatment to an additional high-burden infectious disease (currently, 13 diseases are targeted). Due to the very high impact of preventing or eradicating a disease, the value of developing a vaccine, to which GSK is uniquely advantaged, could be comparable to or larger than the effects of providing deworming drugs per unit dollar.
Question elaboration based on the example:
How should others’ donations be taken into account in EA-related cost-effectiveness analyses?
When should others’ costs be added to the total costs?
When should (the absolute value of) others’ costs be added to the total benefits (as leveraged funding)?
How can the impact of others’ costs be estimated accurately?
Should the expected impact of profit gained due to market provision of another impact be included in an analysis? (For example, if GSK profited from selling deworming drugs and invested this profit into researching a malaria drug.)
2022 GiveWell cost-effectiveness analysis — version 4, SCI Foundation tab, line 101
2022 GiveWell cost-effectiveness analysis — version 4, SCI Foundation tab, line 119
A zero change in non-philanthropic actors spending in absence of GW’s funding is included in GW’s analysis (2022 GiveWell cost-effectiveness analysis — version 4, SCI Foundation tab, line 135).
2022 GiveWell cost-effectiveness analysis — version 4, SCI Foundation tab, line 119
“Units of value generated per philanthropic dollar spent, after accounting for leverage/funging” (2022 GiveWell cost-effectiveness analysis — version 4, SCI Foundation tab, line 196)