HLI assumes any spillover effects to other household members are proportional across interventions—i.e., if a cash transfer benefits other household members’ subjective well-being x% as much as it benefits the recipient, the same is true for therapy.
If there are 4 to 5 members per household (roughly what we estimate for participants in GiveDirectly’s program) and there were no household multipliers from therapy, psychotherapy would be 2x-3x as cost-effective as cash transfers, taking HLI’s other assumptions as given.
This is definitely not what we think, particularly the assumption it will be proportional across ‘any’ intervention! I’m sure why someone would believe that.
Our position, as outlined in this twitter thread, is quite a bit more nuanced. There wasn’t much evidence we could find on household spillovers—five studies for cash, one for mental health—and in each case it indicated very large spillover effects, i.e. in the range that other household members got 70-100% of the benefitted the recipient did. We didn’t include that in the final estimate because there was so little evidence and, if we’d taken it at face value, it would only have modestly changed the results (making therapy 8-10x better). Even in the extreme, and implausible, case where therapy has no household spillovers, it wouldn’t have yielded the result that psychotherapy is more cost-effective than cash transfers. We discussed this in the individual cost-effectiveness analysis reports and flagged it as something to come back to for further research.
We agree that the effects of household spillovers from cash are large. Where our priors may diverge is that HLI (and others) think that the spillovers from therapy are also large, whereas GiveWell is very sceptical about this. We are now conducting a thorough search for more evidence on household spillovers, so we are not just swapping priors.
We have published an updated cost-effectiveness comparison of psychotherapy and cash transfers to include an estimate of the effects on other household members. You can read a summary here.
For cash transfers, we estimate that each household member experiences 86% of the benefits experienced by the recipient. For psychotherapy, we estimate the spillover ratio to be 53%.
After including the household spillover effects, we estimate that StrongMinds is 9 times more cost-effective than GiveDirectly (a slight reduction from 12 times in our previous analysis).
This is definitely not what we think, particularly the assumption it will be proportional across ‘any’ intervention! I’m sure why someone would believe that.
Our position, as outlined in this twitter thread, is quite a bit more nuanced. There wasn’t much evidence we could find on household spillovers—five studies for cash, one for mental health—and in each case it indicated very large spillover effects, i.e. in the range that other household members got 70-100% of the benefitted the recipient did. We didn’t include that in the final estimate because there was so little evidence and, if we’d taken it at face value, it would only have modestly changed the results (making therapy 8-10x better). Even in the extreme, and implausible, case where therapy has no household spillovers, it wouldn’t have yielded the result that psychotherapy is more cost-effective than cash transfers. We discussed this in the individual cost-effectiveness analysis reports and flagged it as something to come back to for further research.
We agree that the effects of household spillovers from cash are large. Where our priors may diverge is that HLI (and others) think that the spillovers from therapy are also large, whereas GiveWell is very sceptical about this. We are now conducting a thorough search for more evidence on household spillovers, so we are not just swapping priors.
We have published an updated cost-effectiveness comparison of psychotherapy and cash transfers to include an estimate of the effects on other household members. You can read a summary here.
For cash transfers, we estimate that each household member experiences 86% of the benefits experienced by the recipient. For psychotherapy, we estimate the spillover ratio to be 53%.
After including the household spillover effects, we estimate that StrongMinds is 9 times more cost-effective than GiveDirectly (a slight reduction from 12 times in our previous analysis).