Good review on the ACX blog of Masooda Bano's 2012 book Breakdown in Pakistan, based on ethnographic case studies, interviews, and surveys of her home country (she's a professor at Oxford). Very worth reading if it hasn't yet come across your Substack feed. Here are some long quotes to whet your appetite.
Vividly shocking opener:
A couple of decades ago in Kabul, a fellow aid worker on his third beer came up with a vivid simile for what American money was doing to the Afghan organizations implementing USAID projects. “It’s like gluing a rabbit mouth-first to a fire hose. You blast its guts right out of its ass…but as long as the water keeps running, it looks like you’ve taught the rabbit to dance.”
Oxford politics professor Masooda Bano uses less lurid language, but Breakdown in Pakistan addresses the same basic phenomenon: how Western aid donors and INGOs unintentionally eviscerate so many of the local institutions they try to “capacity-build.” The problem goes beyond the obvious mismatch of huge funds with small-scale organizations. Even low-to-moderate external funding can leave an organization hollowed out, bereft of local participants and the power it once had to motivate change on the ground.
... Overall, I came to recognize a global machine that systematically:
- sought out organizations with high capacity to mobilize local collective action;
- gutted them of that capacity, in exchange for a new role as professional project implementers and grant managers;
- tried to build new project-specific village committees as an artificial (and desperately inadequate) substitute; and finally
- withdrew funding, leading to the collapse of both the previous institutions and the ersatz ones we’d built up in their place.
We were late-stage German foresters, belatedly trying to import an ant colony or fungi after our monoculture had already devastated the soil ecology.
Why would even low-to-moderate external funding hollow out local organizations?
Voluntary membership organizations, like these voluntary organizations (VOs) had been, are the ideal type of what we call civil society: institutions funded by donations (rather than sales or taxes), operating based on people freely coming together for some shared cause (rather than to make money or obey a government mandate). The foreign aid industry uses “civil society organization” as a virtual synonym for NGO. In reality, aid-funded groups tend to operate rather more like corporate and/or government contractors: paid service providers with comfortably salaried staff, focused on the goals of faraway clients, whose main unifying cause is “whatever helpful thing they pay us to do.”
And as it turns out, that model severely demotivates volunteers. Oxfam’s “capacity-built” Sindhi organizations were certainly non-governmental, but they were no longer voluntary—NGOs, but not VOs. Bano found the same pattern in the 2000s, in a survey of forty successful Pakistani civil society organizations. Of the twenty that implemented foreign-aid-funded projects, none were able to mobilize local volunteers (beyond some interns hoping to graduate to paid employment) and none raised any significant amount of local funding (only three had managed to elicit a few sparse donations from Pakistani companies).
The review goes into much more detail on why volunteers "abandon local collective action groups that reshape themselves to satisfy foreign funders".
Oxfam's capacity-building work in Sindh province as a case study, ft. "workshopias":
Oxfam soon discovered an unexpected dark side to its “capacity-building” work in Sindh province. It had trained six locally prominent welfare organizations in strategic planning and proposal writing, and got them started on implementation by giving them $1000 to work with. The VOs largely met their explicit project targets, and seemed ready to engage with international development funds on a scale much greater than they’d handled before.
Yet all six organisations were visibly more dysfunctional at the end of the project than they had been at the beginning. They were consumed by factionalism, accusations of favoritism, legal battles over control of funds. And they had lost virtually all of their volunteers—notably including the members whose monthly donations and contributions of time had for decades been the backbone of their work. An Oxfam official observed about one group: “From thirty active members, the size of the team shrank to three or four people who had become workshopias,” i.e. those who had gone to every training workshop and built the strongest relationships with the foreign donor. The kind of welfare work the VOs had previously done, based on mobilizing communities for mutual support, was now beyond their capacity.
But so what?
So what? As long as the project achieves its outputs—the disaster relief or cash grants distributed, the latrines built, the agriculture training sessions delivered—why would we care what hair-splitting label gets put on the organization that did it? Shouldn’t we expect professionalism, the profit motive, and higher volumes of funding to yield better long-term results anyway, compared to unreliable, unscalable, harder-to-monitor voluntary work?
Bano is a rational choice theorist, and reminds her readers of the value of voluntary collective action through a recap of some classic theory by Garret Hardin, Mancur Olson, and Elinor Ostrom. Any community’s common interests require people to work together cooperatively; but it’s surprisingly difficult to sustain that cooperation, thanks to free-rider problems and inequalities of motivation and information. Shared resources, in particular, often collapse in a “tragedy of the commons” where individuals’ incentive to use as much as possible leads to overexploitation.
Coercive rules imposed by a state are one way to overcome this problem—but no state can generate all the cooperation we need for a functioning society, and in many countries the authoritarian, exploitative government is an unlikely source of public-interest regulation. That needn’t leave us in despair. Even management of common-pool resources (one of the thorniest collective action problems) can be done effectively through voluntary institutions. In fact, local collective action often yields better results than either state coercion or the individualized incentive structure of competitive markets. ...
At the end of the day, institutions for voluntary collective action always rest—not solely, but significantly—on social trust. And once trust is lost, it’s exceedingly hard to rebuild. ... [Bano's] survey found that even Pakistani VOs that hadn’t taken foreign aid now experienced “difficulty retaining volunteers or inducting new ones from the younger generation, and most of them attributed this difficulty to the rise of the ‘NGO culture.’”
Lots of sobering anecdotes throughout, the reviewer seems to have spent a long time working in aid on the ground.
So what should folks do differently?
Bano doesn’t think the answer is to insulate local organizations entirely from international aid flows (still less to choke off those aid flows, DOGE-style). Instead, she calls on donors and INGOs to take deliberate steps to “minimize the negative impact” of their funding...
... the fundamental change we’d make is to treat a VO’s ability to mobilize local collective action like it’s gold dust. Vocally, publicly value it. Talk to everyone about its strategic importance. Actually measure it—track the capacity of VOs to retain members, attract volunteers, and raise local donations as a core indicator of institutional health. And if it starts to drop, treat that as a crisis on par with financial fraud. Investigate its context-specific roots—what religious, social, and/or political values are motivating people to give time and money to the VO in question—so that we’ll have some idea of how to respond if our work does begin to diminish it.
In our capacity-building work, we wouldn’t focus on turning local groups into part of the management chain for dwindling foreign grants. Rather, we’d primarily aim to give them the equivalent of a “three-self” vision, and the skills to back it up. We’d encourage them to keep a primary focus on the priority problems of their target communities; we’d take care not to overburden them with monitoring and reporting requirements. ...
We wouldn’t aim (either explicitly or implicitly) to replace the “psychosocial and religious incentives” that motivate community volunteers and VO members with material ones, in the name of formalization or professionalization. We’d drop the host of small, commonplace, deeply counterproductive incentives that too many NGOs use to get people to attend trainings and advocacy events—even if that means we have to revise our project events so that local people are actually willing to invest their own time in attending them.
We’d do all we could to avoid destroying the most common signal of commitment—material sacrifice—that reassures local donors and volunteers the VO isn’t exploiting them. Bano doesn’t think this requires everyone working in the aid sector to live like Abdul Sattar Edhi or Mother Teresa. It likely does involve paying below-market salary rates to staff; thorough consultation with all of a VO’s members before agreeing to pay anyone; and setting policies on e.g. vehicle use, office location, and travel per diems with due consideration to public perceptions of waste and wealth. It would require a readiness to adapt incentives over the course of a project or funding partnership, especially if there’s evidence of harm.
We’d prioritize the funding of activities, rather than staff salaries and benefits, and not fund those activities so lavishly as to discourage economy or innovation. ...
EA relevance:
What does Bano’s work imply for the approaches most beloved of effective altruists? Some cost-effective interventions don’t rely very heavily on local collective action capacity. Households can generally make use of bed nets or cash grants even in a low-trust environment; those distributions can be well-handled by NGOs whose primary competency is grant and project management.
The picture shifts slightly as we move into high value-for-money public health measures: deworming, malaria treatment, vaccines. It might seem that a big, salaried state health sector is all that’s required to deliver those at scale, but in a host of countries, the key frontline personnel are actually community health volunteers. The more that “NGO culture” strains collective action, making local people feel like suckers for giving their time to the community without pay, the more friction we’ll be creating for these lifesaving interventions.
We’ll also inevitably encounter situations where people’s ill-health and poverty are grounded in beliefs and attitudes—e.g. the deep suspicion of polio vaccines in the Pashtun borderlands, or the conviction in western Nepal that selling milk to a dairy coop is an intolerable risk (because it might be sold to a low-caste person, angering deities who will kill you or your cow.) A local VO, embedded in its community, can be a powerful and effective ambassador for changes in belief. But as Bano and Nevius both relate, salaried staff with no significant signs of sacrifice often struggle to catalyze this kind of transformation. “You’re just bringing me this message because they’re paying you to,” is a natural discounting factor.
Any humanitarian effort will also quickly run up against politics. Giving a cash grant to landless tenant farmers in Pakistan won’t have much impact when their landlords can just nudge up rent levels to extract the added wealth. Changing that kind of systemic exploitation requires a local institution like AMP whose core competence is risky, politically-charged community organizing. If in searching for a local cash delivery partner, an INGO takes that kind of institution and distracts and depoliticizes it, we’ll ultimately have done more to reinforce than alleviate poverty.
Western altruists could try to invest their donations only in areas requiring minimal entanglement with beliefs and power dynamics. That’s a defensible choice—not solely a drunkard’s search, investing in the areas with the fewest factors confounding our efforts at evidence generation. There’s unquestionably lifesaving work to be done in that space.
The main implication of Bano’s work then becomes a “do no harm” one: channel your funds through an institution that never had much capacity in the first place to mobilize local collective action, so that delivering your preferred interventions doesn’t kill off that capacity. Or (much better) take the time and care to engage with local partner institutions in ways that preserves their capacity to mobilize volunteers. Either way, it requires giving extra consideration not just to EA’s usual core question, “which are the best-evidenced interventions?” but “what are the least damaging institutional pathways for delivering those interventions?”
I'd be curious to get takes on any of this.
I think that Coefficient Giving’s decision to donate more money to GiveWell is a bad one and I would like to see more discussion of its pros and cons as well as any resources folks have that explain why CG made this decision.
The short form of why I think this is a bad call is that I think that for a wide range of beliefs on other issues (AI, Bio Sec, US Democracy, Reproductive Tech, emerging farming tech) the 10 year expected return on donations is much higher than in global health. Maybe this has already been talked to death but I’d like to see a discussion on it and if anyone has resources to past arguments I’d love to see them.