Japan: To Give or Not to Give?

Post by: Freakonomics
March 17, 2011 at 10:30 am

Photo: Marc Veraart

In the wake of Japan’s tragic earthquake and tsunami, Felix Salmonargues against donating to the cause.  Salmon cites concerns about the hobbling effects of earmarked funds, uncoordinated NGOs, and Japan’s wealth.  ”[I]t’s entirely possible that organizations like the Red Cross or Save the Children will find themselves with important and useful roles to play in Japan,” writes Salmon. “It’s also certain that they have important and useful roles to play elsewhere.

So do give money to them — and give generously! And give money to other NGOs, too, like Doctors Without Borders (MSF), which don’t jump on natural disasters and use them as opportunistic marketing devices. Just make sure it’s unrestricted.”   Meanwhile, Tyler Cowen disagrees, pointing to a lower likelihood of corruption in Japan, the need to signal America’s partnership with Japan, and a third factor: “Maybe you should give to a poorer country instead, but you probably won’t.  Odds are this will be an extra donation at the relevant margin.  Sorry to say, this disaster has no ‘close substitute.’”

In SuperFreakonomics, we wrote a chapter on altruism that addressed the “CNN Effect” of disaster relief:

Is it possible to use natural experiments, like the ACLU-prison scenario, to measure altruism? You might consider, for instance, looking at a series of calamities to see how much charitable contribution they produce. But with so many variables, it would be hard to tease out the altruism from everything else. A crippling earthquake in China is not the same as a scorching drought in Africa, which is not the same as a devastating hurricane in New Orleans. Each disaster has its own sort of “appeal” — and, just as important, donations are heavily influenced by media coverage. One recent academic study* found that a given disaster received an 18 percent spike in charitable aid for each seven hundred-word newspaper article and a 13 percent spike for every sixty seconds of TV news coverage. (Anyone hoping to raise money for a Third World disaster had better hope it happens on a slow news day.) And such disasters are by their nature anomalies— especially noisy ones, like shark attacks— that probably don’t have much to say about our baseline altruism.*

*See Philip H. Brown and Jessica H. Minty, “Media Coverage and Charitable Giving After the 2004 Tsunami,” Southern Economic Journal 75, no. 1 (2008).