On the grants side of your formula, there are huge differences in flexibility between different projects. The direct cash transfers of Give Directly can scale up and down very rapidly.
On the donors’ side of your formula, it is not only about size but also volatility and reliability. There are big donors with stable wealth and a track record of regular predictable donations.
In my mind a sensible overall allocation would have at least as much money going to very flexible projects (ex: direct cash transfers) as the amount of money coming from very unpredictable sources (ex: one big donor whose wealth coming from risky assets varies a lot every week). This would capture the high rewards of volatile donors, without putting so much uncertainty to the teams who need some stability over the time.
For sure, this is always under the assumption that all donors, big or small, predictable or volatile, meet a minimum ethical standard in their practices.
On the grants side of your formula, there are huge differences in flexibility between different projects. The direct cash transfers of Give Directly can scale up and down very rapidly.
On the donors’ side of your formula, it is not only about size but also volatility and reliability. There are big donors with stable wealth and a track record of regular predictable donations.
In my mind a sensible overall allocation would have at least as much money going to very flexible projects (ex: direct cash transfers) as the amount of money coming from very unpredictable sources (ex: one big donor whose wealth coming from risky assets varies a lot every week). This would capture the high rewards of volatile donors, without putting so much uncertainty to the teams who need some stability over the time.
For sure, this is always under the assumption that all donors, big or small, predictable or volatile, meet a minimum ethical standard in their practices.