Doing the most good

The 2008 Copenhagen Consensus Conference had one basic idea: Imagine you had $75bn to donate to worthwhile causes. What would you do, and where should we start? No small task.

There were ten problems to be addressed: Air Pollution, Malnutrition and Hunger, Conflicts, Sanitation and Water, Diseases, Subsidies and Trade Barriers, Education, Terrorism, Global Warming and Women and Development. Around 55 of the world's leading economists and specialists in the ten challenges were involved in the project. For each of the ten challenges a group of three people (The Challenge Paper Authors), and two commentators (The Perspective Paper Authors), compiled up-to-date analysis of the solutions.

The proposed solutions were developed by the specialist scholars over the past two years and were presented as reports to an expert panel of 8 top-economists, including 5 Nobel Laureates, over the period of one week. Since we live in a world of scarce resources, not all good projects can be funded. So the experts were constrained in their decision making by allocating a budget of an "extra" $75 billion among the solutions over four years.

The Outcomes (pdf):

Combating malnutrition in the 140 million children who are undernourished reached the number one spot, after economist Sue Horton of Wilfrid Laurier University in Canada made her case to the expert panel. Providing micronutrients for 80% of the 140 million children who lack essential vitamins in the form of vitamin A capsules and a course of zinc supplements would cost just $60 million per year, according to the analysis. More importantly, this action holds yearly benefits of more than $1 billion.

The second-best investment the world can make to improve the state of the planet is to implement the DOHA development plan. Recast as after calculating the net present value of the stream of future benefits, a realistic Doha outcome could increase global income by more than $3000 billion per year, $2500 billion of which would go to the developing world.

The third top-priority of the economic experts is micronutrient fortification involving the iodization of salt and fortification of basic food items with iron. An estimated two billion individuals worldwide suffer from iron deficiency, of whom more than half are in South Asia. Salt iodization provides protection to goiter. Currently 31% of developing-world households do not consume iodized salt and are therefore not protected. Fortification of basic food-stuffs with iron, and iodization of salt, offers very high benefits for relatively little cost. An annual investment of $19 million would scale-up salt iodization in the three lagging regions of South Asia (current coverage 64% according to UNICEF, Sub-Saharan Africa (64%) and Central and Eastern Europe and the Commonwealth of Independent States (50%), plus afford iron fortification reaching 80% of the population of sub-Saharan Africa and South Asia, where the current coverage is assumed to be negligible. The benefits will be in the order of $570 million.

Just for the record, what proposed solution is at the bottom of the list? At number 30, the lowest priority is a proposal to mitigate man-made global warming by cutting the emissions of greenhouse gases. Nobelist and University of Maryland economist Thomas Schelling noted that part of the reason for the low ranking is that spending $75 billion on cutting greenhouses gases would achieve almost nothing. In fact, the climate change analysis presented to the panel found that spending $800 billion until 2100 would yield just $685 billion in climate change benefits.