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Posts Tagged ‘misallocation’

Global AIDS Crisis is overblown

December 5th, 2008

I “dare” to say so. This is a great article. My favorite part:

“Diarrhea kills five times as many kids as AIDS,” said John Oldfield, executive vice president of Water Advocates, a Washington, D.C.-based organization that promotes clean water and sanitation.

“Everybody talks about AIDS at cocktail parties,” Oldfield said. “But nobody wants to hear about diarrhea,” he said.

This is interesting too:

“There needs to be a rational system for how to apportion scarce funds,” said Helen Epstein, an AIDS expert who has consulted for UNICEF, the World Bank, and others.

Maybe we should allocate them per country or per region such that the amount of money for a given epidemic or other health concern is proportional to the need (now I’m starting to sounds like a communist, but bear with me) for that treatment. Now, of course there will be issues with estimating how much of each treatment a country might need in the coming year, especially first aid materials, but for most illnesses (see AIDS and malaria) we can probably safely use this year’s statistics to estimate the amount of treatment that needs to be available next year. Therefore, the various charitable organizations that accept donations for healthcare, as well as the World Bank, should accept money with a policy that it will be used as efficiently as possible rather than promising to use the money for AIDS, cancer, etc.

The problem with this is it doesn’t sound like you’re addressing a particular problem when you do it, so you can’t use it to prop up your ego. If one were to lose a loved one to cancer and he/she wanted to donate to a cancer fund, the only ones available would be the general healthcare funds and specific cancer research organizations. Another problem is that it wouldn’t make any difference to reform the policies of the organizations, because they could just split up into multiple entities (cancer, AIDS, malaria), and the money would be mis-allocated in the same fashion. The only real way is to outlaw receiving or donating funds for specific types of healthcare, which is completely insane.

So, do we make it cool to donate to diarrhea? That doesn’t seem possible to me. Perhaps in cases of foreign aid, we should only allow general donations because of this resource mis-allocation problem.


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