Aid 2.0
July 2nd, 2007
I would like to take some of the principles of Web 2.0 and apply them to International Aid, to look at how technology can flatten the hierarchical systems, engage people and bring them close together.
First of all I would share my idea of how Aid works (or doesn’t work, as some may argue). I wouldn’t call myself an expert, but I have some experience on the subject having worked for the Aid Industry in Indonesia, Pakistan and Uganda. I’ve also talked with the people in the industry, and read up on the subject.
I say Aid “Industry” quite deliberately, because it is huge. There are billions of dollars floating around, hundreds of different organizations, all trying to get their cut, and thousands of people who have built careers in the industry. The following diagram is a simplified view of the flow of Aid.
I should emphasize that the majority of Aid, isn’t given directly by people in developed countries, but instead comes from their governments, often giving grants worth millions of dollars.
I believe that this model is too complicated. There are too many different layers which Aid must trickle through, before it can reach the end beneficiaries. This is a problem for the following reasons:
Efficiency
Each link in the Aid chain adds another level of bureaucracy, which costs money. Also, when an organization or individual is more removed from the recipient of their Aid, they will have less understanding of the context and situation which they are trying to improve. This will mean they are unable to direct their Aid for the maximum benefit.
Engagement
I believe donors should be engaged with the work which they are funding, so that they understand the importance of the work, and continue to feel connected to it. The more personal the engagement, the better. I believe that there is a huge difference between the feeling a taxpayer gets when their government gives a multimillion dollar grant verses when someone sponsors a child directly.
Accountability
Just as Aid flows down the chain, accountability must flow up the chain. However the more links there are in the chain, the more this accountability gets watered down. Taxpayers in the developed world may fund numerous multimillion dollar projects to help people in the developed world. Often these projects fail, and the beneficiaries get very little value for the money spent. However, when the final reports are written, and passed back to the original donors, failures will be turned into “lessons learnt” (although the lessons are often not learnt) and other excuses. The people who actually funded the project are not always given the information needed to ensure that their funds are not misspent the same way again.
Sometimes it appears that the Aid Industry is like a huge corporation, that just spends money without looking at the bottom line. Enron-esque book keeping allows them to hide their failures, and keep on operating – business as usual, while poverty continues.
Never-the-less I think that Aid is extremely important, and despite all of it’s problems, the current model is what we’ve got at the moment, it’s the model which I currently work in, and it does do some good.
However with current developments in Information Technology there is room for a lot more improvement.
Blogs, Wikipedia, YouTube and other “Web 2.0” developments are breaking down the traditional hierarchical, top down information flows of media conglomerates, allowing people to communication directly with each other, and participate in creating information. In the same way, I believe that technology can bring people in the developed world closer to Aid recipients in the developing world, and improve the way the Aid works.
Instead of millions of dollars being given in huge grants by governments and international organizations, millions of individual donors should take the responsibility for giving their money where they see best. Instead of huge projects managed by large organizations, this would encourage individual donors to participate in creating piecemeal solutions.
I have included local NGOs in developing countries in this model, because I think that there still is a need for them. I think that there are some local NGOs who are very committed, and do very good work, on very low budgets. I still believe that they play a roll in coordinating communities in the developing world, and help connecting them with donors.
Traditionally there would have been major problems with this model, but thanks to technology, I think that the improved flows of information, can be solve those problems.
At first glance the Aid 2.0 model may look like an elaborate Nigerian Email Scam. How it is possible to ensure that the person you are giving Aid to actually needs it? Or it is being spent appropriately?
However better technology enables better sharing of information, which helps to ensure that Aid money is spent appropriately.
A village in Africa might be able to set up a blog, where they can share stories, photos and even videos, which make it very clear that they need money for a new water supply. We could even be able to look that village up on Google Maps, to get a bird’s eye view.
More realistically, the village will be represented by a local NGO, who has the capacity to create a web presence, but is still enough to have the specialized local knowledge needed to really make a difference, and is more focused and dedicated to the work which they are doing.
Ebay, the online auction website, has a simply system to create trust between their sellers and buyers. The buyer must trust the seller, when they send their money before they have received their goods. However the buyer can first check the feedback from other people who have purchased from this seller, allowing them to trust that they will receive their goods.
A similar system could be created for donors and recipients of Aid. When individual donors give money, and see that the recipient have used it for their benefit, they can give positive feedback. This will ensure other donors that this recipient will benefit from further donations.
Some would argue the average individual in a developed countries won’t make the right decisions regarding where and how to donate their money. The problems in developing countries are complex, and they require experts to find the right solutions. However the same could be said for economies. If we think that way, how can we trust individuals in the to make the right decisions to what work to do and what goods to produce? Shouldn’t this be determined by experts in the government? As far as I am aware, free market economies, where the individual has the choice, have been far more successful than centrally controlled economies.
There is also an argument against piecemeal solutions, for example, sponsoring children. Many organizations are moving away from this, because it doesn’t look at the whole problem. You may sponsor a child, but if their parents still do not have work, you will not have created a sustainable solution.
But what about Wikipedia - the online encyclopedia, which allows any one to submit articles? If a single person, or even a group of people tried to write this, it would be a huge and complex task, but by pooling the expertise of thousands of people on the internet, they now have more articles than Encyclopedia Britannica.
The same could happen for Aid, when you start pooling all of the individuals in the developing world. Different people would donate differently, some people would preferable to help children, some people would prefer to help create economic opportunities and some people would see where there are gaps, and their donations can have the biggest impact.
I think that the most important thing about the idea of Aid 2.0, is it encourages people in the developed world to participate in how their money is spent. It allows them to engage with the recipients of the Aid, see the benefits of it, and connect with the people they are helping. It allows them to take responsibility in ensuring the money is spent wisely. Undoubtedly, there will still be money which is spent badly, or wasted, but I think it is better to trust the wisdom of the masses, than the wisdom of a few experts.
At the moment, I know of one organization which comes close the Aid 2.0 model – Kiva , which I have mentioned before on my blog. They allow people to go online, and choose business people in developing countries and make microfinance loans to them. Kiva works through local partners in developing countries to find candidates for the loans, and distribute the money. I have personally donated to a number of people.
I still feel that this needs more work, the information which is provided about the recipients is rather trivial, and I haven’t been able to get in direct contact with them. However I think that this is still a step in the right direction.
I have also seen p2pAid, althoughI am not so familiar with it, and it still appears to be getting started.
There are still problems with the Aid 2.0 model:
First of all I make the huge assumption that everyone can access the internet. Although internet penetration is increasing in developing countries, most people still do not have access to a computer or internet. However I believe that this is changing. I also think that it is not essential to have internet access for the Aid 2.0 model. Mobile phones can provide people with a connection to the whole world, allowing them to talk, send text messages, and photos. And the number of mobile phones in developing countries is skyrocketing. However, there are also language barriers to get over.
Finally I would like to clarify that the Aid 2.0 model really only applies well to development Aid, as opposed to humanitarian relief to disasters, where the infrastructure of a large organization can be required to provide emergency relief.
I am sure that there are other problems with the Aid 2.0 model. It may even be fundamentally failed. However I think that there are also problems with our current Aid model, and I believe that some of these concepts could improve it.
Please let me know if you think so. I welcome all comments and discussion.
July 3rd, 2007 at 4:44 am
(I think you have a typo in your diagram (developeddeveloping on the left side)
I think this is going in the right direction, but I’m concerned that the local NGOs don’t/won’t/can’t reach the people in the developed countries. As you’ve mentioned, technology can help with that communication, but there still may need to be broker/directory-type sites on the developed side that collate this information and make it easy for the people in the developed countries to participate easily. Kiva is an obvious example of this - they make it easy for you or I to loan money to people in lots of situations in lots of countries.
Also, do you see projects like OLPC allowing people to participate more easily, and making local NGOs more accountable and efficient? They could (should?) effectively have to compete to be able to organise aid for a particular person/town/village, and the increased information available through the Internet could allow people to find the best NGO to support their needs, and choose them as a representative based on their track record.
July 3rd, 2007 at 8:19 am
For my two cents, I think there’s a lot of merit in Aid 2.0. I’m very much in favour of giving people more control over where there money is going, and reducing the costs of administering the system by flattening out the layers. I think it’s also easier to prevent widespread corruption in a system of peer to peer relationships.
I think the fundamental problem may be that it requires more time and thought from the donors. People are willing to donate to larger organisations because they believe that organisation knows where that money is best spent and how to spend it effectively. Faced with literally hundreds of places to send a donation, donors are likely to feel out of their depth, and that will probably prove a barrier to donating.
Aid 2.0 also implies that potential recipients of aid might need to find a way of marketing their need somehow to get any donations. That could create some complications.
The further question is how do you get donors to use the system? Large NGOs are good at soliciting donations, by advertising etc. How does a Web 2.0 system encourage donors to use it? Maybe set up some sort of local NGO in the developed country to solicit the funds and then distribute them via the Aid 2.0 system? A small group of committed people could use the system very effectively…
Just a bunch of random thoughts…
July 3rd, 2007 at 8:52 am
Surely thats the whole Web2.0 thing again though? We used to rely on TVNZ to know what was good to watch. Now we have YouTube. We used to rely on the radio to know what was good music - now we have iTunes, eMusic, Internet Radio, and others. Newspapers - blogs. Directories (Yahoo) - search engines.
I think there is a place for some/all NGOs in developed countries to facilitate the donor-side (but who don’t do any aid themselves) - but there could be many and they could compete for our donations as well as our government’s.
July 3rd, 2007 at 1:40 pm
I agree with much of this but I think there are some pieces that I’m not quite sure about yet….but I am too tired tonight to properly respond so I will just say: well done! Glad you put this up– is this a presentation for a conference or something? Very interesting….
July 3rd, 2007 at 5:32 pm
The Economist appear to be thinking the same thing, and are going to start up an online non-profit which links Grameen-style thinking with the current mood of optimism about the possibilities offered through online collaboration. Like Nabuur on a bigger scale.
July 3rd, 2007 at 6:54 pm
Thank you all for your comments.
Rob,
When I talk about Local NGOs, I mean NGOs in the developing world, which are in the best position to serve the people there.
I absolutely thing that there is a place for NGOs in the developing world to develop broker/directory sites, but I think these should be more along the lines of Technorati, which is a directory for blogs. Any directories, must allow all people to list NGOs, and give feedback. I think if more people participated in creating this information, we would end up with a better idea of what NGOs are good, and which ones aren’t. Just like book reviews on Amazon. I also that people who may not have as much money, should be given the resources to be able to investigate, what NGOs are good, and which ones aren’t.
I support projects which bring appropriate information technology to people, but I also think that there are a lot of projects with information technology which are not appropriate. I believe that the OLPC (One Laptop Per Child) project is one of them, and will be blogging about that later. One reason is that it is a huge top-down project trying to use a standard solution for everyone – not very “Aid 2.0”.
Richard,
Thanks for your feedback.
I understand what you mean by this making things harder for donors. But I think that this is essential. I think people who just want the easy option to give some money to a well known NGOs, are just doing it to feel good about donating, and possibly resolve their guilt of being in the top 5% of the world’s richest people. I think if people are truly serious about their donations making a difference, they need to put some more thought into it.
NGOs are all about the marketing. If they didn’t show you pictures of starving children with flies in their eyes, would people really donate? OK, I’m being a bit cynical. I think that the internet offers small NGOS in the developing world the same opportunities to market as the large INGOs have. Just like it has given small independent bands the chance to release their own music.
However, I don’t believe people should be distributing funds on behalf of others. I believe that we should be helping the people who actually need the funds, to get their own resources to solicit the funds.
Leisel,
I’m very keen to know about the parts which you don’t agree with, because that’s obviously scope for improvement!
This isn’t for a conference (that post is coming later in the week!). I’m not sure how I’d feel about presenting it…
Tom,
Thanks for the links. I had a quick look at the Economist thing. A few thought – I worry that it may be Western experts telling people in the developing world what to do, when they don’t really understand the full situation, compounded by the fact that they’re not even in the same country (At least I’m in the developing country when I do that!).
Also I would like to see something where everyone can participate, not just the experts.
I’ll have to look into that further though.
July 6th, 2007 at 2:18 pm
I want to further clarify/develop a point or two from my first comment…
Rob, I know what you mean about having things like youtube etc as opposed to TVNZ. My key distinction between youtube and Aid 2.0 is that we go to youtube for (harmless) selfish reasons, where we don’t really go ‘hey I think I’ll spend my evening donating to developing countries’ quite as often. That’s more a comment on the ordinary human psyche than anything. Finding good stuff to watch is a more common want than wanting to give money away for most…
I don’t think most people who donate to large NGOs are doing it to assuage guilt. And even if they are is that bad? Does it detract from the donation if it is from guilt or from wanting to feel good about donating? I think I feel good if I donate. Is that bad? Am I less for that?
My point is that I believe most people who donate to Oxfam or The Red Cross etc are doing so for genuine reasons, and because they want to help. To most people I think the large NGOs represent places where they can send their money if they want it to do good, or they wouldn’t send it there. It’s the obvious starting point, and it’s a lot easier to get into than the Web 2.0 thing.
Just an observation.
July 6th, 2007 at 5:26 pm
Richard,
Thanks for your reply.
Why do you go to YouTube? To have a look around? See something interesting? Because you’re curious? Because it allows you to share other people’s experiences?
Go have a look at some of the borrower’s profiles on Kiva.
OK, I admit that they aren’t that interesting, but what if there was more information there? Stories of how a family lost their child to malaria, because there isn’t a health clinic in the village, photos of children at a school which is trying to build a new well to ensure that the children have clean drinking water, or even videos of children using the well which you helped fund.
I think that if we had that sort of rich experience we could appeal to the same part of the psyche that watches videos on YouTube. Sure, not as many people will donate, but I think more people will donate.
I’m not faulting people for donating to large NGOs, but as I stated in my post, I believe that there are problems with the way large NGOs work, and I think we can do better.
I think that it is definitely bad if people donate out of guilt. If you look at it in terms of incentives (economically speaking) – what are the incentives for the NGO? Ideally they should be to help people in the developing world, but actually they can become just appeasing people’s guilt, or try to “represent” a place to send money to, to do some good.
This isn’t actually different than doing good.
For an analogy, do you invest in a company that appears to be making money, or that is actually making money (shares in Enron anyone?).
The problem is that it is a lot harder for NGOs to prove that they are doing good.
July 7th, 2007 at 3:43 pm
Interesting blog….I definitely think the idea of AID 2.0 has merits, which you have talked a lot about …but where are its shortcomings? In the 1990s the trend of foreign donors was to funnel money through NGOs - local and international. This was due to the emerging neo-classical economics thought and associated scaling back on the state, a view that NGOS were better able to cope with the problems, and a fear of the state and corruption. Consequently, with all this $ the number of NGOs proliferated rapidly…..international and local.
There was also a lot of corruption - you have heard of BONGOS? GONGOS? Also, this led to an exodus of ‘good’ bureaucrats, as NGOs paid much higher. Which undermined and further weakened state capacity, in the last few years there has been a swing back to focus on supporting institutions and building strong states. Increasingly, aid is delivered directly to the government, with an aim to better equip government apparatus with the capacity to provide essential state services. “Good Governance” as become a catch cry in the aid industry lately.
Which brings me to my point… Aid 2.0 certainly has its merits, but I do believe the aid industry does need to look at building strong institutions…..hence there is a need for international “experts” here…the question is them, how to involve the individuals in developed countries in building strong institutions in developing countries?
July 7th, 2007 at 3:45 pm
Bea,
Good points. I believe that Aid 2.0 is about focusing on the small grassroots work. Emphasis on “small”. It is not about funneling money, but about channeling money. A funnel has a big input and a small output, where as a channel has the same sized input as output. When large amounts of money are funneled there is less capacity for accountability and more corruption.
With Aid 2.0 the donations will be smaller, but there will be more of them, and they will be more direct. Because people are donating personally, they will be more aware and scrupulous at weeding out corruption. And because the organizations are smaller, and the amounts of money are smaller, the capacity for corruption are also less.
I believe that the challenge for Aid 2.0 relies on getting enough information out of the developing countries, and about the small local NGOs. Although I believe that this is possible now days, thanks to technology, this is still a challenge. Getting this information is an expense, both in the technology required, and the time required to collect the information. This is where I thing people from the developing world can help. There is no shortage of young people from developing countries who want to travel the world, and many of them are very socially conscious, and some are eager to do what they can to help. I believe that they could be utilized to document the work of small local NGOs in developing countries, to give them access to donors in developing countries.
I agree that there is still a need for “Good Governance”, and maybe this is where we still need International NGOs, but this cannot only be a top down initiative. By working at the grassroots level, you can help built the support required for “Good Governance”.
July 22nd, 2007 at 1:20 am
Hi Micheal. I haven’t checked on your Blog in awhile and it is good to hear you’re back in Banda. I’m looking for another gig there myself but enjoying the long summer days back in the states for now.
Anyway I like the aid 2.0 for economic development. Great way to get a business started! Also it might be good for small scale infrastructure - say a community wants to build a new school or something. For the the other parts of development I think it is important to still do the big government grant type work. Creating the governmental infrastructure, say health and education standards, or rural electrification, setting up courts, and monitoring fisheries I think would be tough to do with a P2P model. I mean who would want to kick in 50 dollars to buy a hundred meters of electrical cable when they need 300 kilometers of the stuff to even get started? It might happen but would be competing with buying school books for some cute kid.
(I had a bad experience with local NGOs in Sri Lanka - terribly corrupt ) the Nigerian scam artists that you mentioned are not a trivial problem to be countered with a peer rating system. For instance say I donate some money to a Sri Lankan NGO to dig a well. They send back a picture of the well- sounds simple, but do I know the well was new? Do I know that the NGO wasn’t being paid by someone else to build the same well? One contractor in Sri Lanka tried to get paid by three separate NGOs to build the same toilets and never even finished them. Hard to stop that kind of corruption without somebody on site. The next problem is the false accusation against a local NGO. What do I do when I get an email saying the well I paid for was also paid for by UNICEF? Do I quit donating to that NGO and go with a rival? Does the emailer have and agenda against someone in the local NGO. It gets complicated fast. I am concerned that the local NGOs that could present the best picture, rather than those that did the best work would end up with the bulk of the funding.
I am concerned that local NGOs would just concentrate on marketing and lose interest in the non-glamorous part of development. This a big enough problems with large NGOs just following development trends and would be worse with lots of little ones going for the same $$. Big NGOs like OXFAM can ask for cash for disaster assistance or development then use it to do stuff like dig toilets and run a handwashing campaign that would probably not generate that much interest from donors. They can also go to places that are not that popular. Some local NGOs are great, some are scams and I would not want to see the bulk of aid money going to them.
I think direct aid is going to become more popular and will be effective for certain types of development but I am not sure that we can count on it to replace traditional aid the way wikipedia has supplanted commercial encyclopedias. Money is not the same as information, and there is more to aid than money…..
August 12th, 2007 at 7:51 pm
[…] for, but they might need different approaches to be achieved - while some of my colleagues (such as Michael Howden) believe that Web2.0 (which includes initiatives like OSM) can bridge the two sides, I’m […]
August 13th, 2007 at 9:38 am
Andrew,
Good points.
I agree that the Aid 2.0 approach is better suited towards small scale economic development than large scale infrastructure. However I believe that the small scale economic development should lead to the large scale infrastructure.
Once you have helped a village full of people increase their productivity, set up businesses, etc etc, they will have more money, enough to be able to afford electricity. If the market is working (which is a big if), the local electricity provide should see that it is now economical to build power lines out to the village and sell them electricity. Because there is a demand for the power, and someone benefiting out of supplying the power, those lines will be used and maintained, which might not be the case if the lines were built by an NGO according to some perceived need.
The same could apply to roads, health, education or government, where the systems are built from the bottom up, rather than the top down.
I still think that there is a place for NGOs to advise and assist, but not to impose.
Corruption is a HUGE issue. Some of the harder sources of information (photos and videos) could help ensure that information is correct. Also by increasing the flow of information, you will be able to validate facts from a range of sources. All of the sources may not say the same thing, but people will just have to learn how to understand the different biases, and make educated judgments.
Your point on putting too much focus on marketing is good. Currently in NGOs there doesn’t seem to be much continuity in information between project management, monitoring and evaluation, donor reports and public marketing. Information gets “massaged” to suit each audience, and the reality of the situation on the ground gets clouded. I would prefer to see a more open, holistic approach to information, where organizations share their operational information more openly, and donors (big and small) can get an accurate picture of what is going on. There would be a number of problems with this, most importantly the sensitivity of some of the information, but I also think that this would increase the accountability of organizations.
If information is shared openly, I hope that the market would respond by funding the projects which would have the greatest impact, rather than the greatest “feel good factor”. But maybe I’m over estimating the levels of engagement of donors.
It is interesting that you say this. I agree with you, but I would also say that information plays as big a part is Aid as money does, and the Aid 2.0 model is as much about the flow of information as the flow of money.
November 28th, 2007 at 10:02 pm
Hi,
Thank you for your post really interesting. I am currently trying to develop something using web 2.0 for Aid but at another level. I am trying to build a network of donors for knowledge management and capacity building for developing countries. Actually a platform (like plone) in order to foster collaboration and effectiveness. I can say that also this kind of activities are needed and could benefit developing countrie, but even if working with “experts” and in developed countries with good internet connection I am figthing huge obstacles: political agendas, competition among agencies, ignorance, etc…
I keep figthing toward web 2.0 because I think that the collaborative work between donors could strongly enhance the results of Aid and with time it could reduce barrers and obstacles that come from years of stand alone work.
I do not think that for the moment the idea of bypassing international donors is feaseble, but I agree that we should tend toward it. At the moment what we could do realistically is to use the huge potential of web 2.0 to enahance Aid and in particular monitoring, evaluation and accauntability of international donors.
I am sure that if we could really show where is going much of the Aid industry money many heads of agency will easily find their way home for retirement and many political agendas will change.
Cheers,
Andrea
December 10th, 2007 at 11:01 am
Andrea,
Thanks for your comment. I don’t think that Aid/Web 2.0 represent a magic bullet which will solve all of our problems, and even if they did, the real challenge would be transitioning from our current model. However I believe that there are a number of ideas which could be beneficial.
There definitely needs to be more collaboration, I would like to see a shift toward “Open Source Aid”, where people realize that it is mutually beneficial to share information more freely.
The question is whether these initiatives come from the top down, or the bottom up. Ultimately I think that they will come from the bottom up, because that is where the need is the greatest, and that people are more willing to accept practical solutions.
I believe that the solution isn’t to try and implement standard systems and frameworks, but to work on ways to integrate the systems and information which people already have (Aid Mash-ups).
Part of this would involve using standard formats for collecting information, and a greater focus on Meta-data.
The most important thing for us is to ensure that our solutions are practical and useful, and we don’t just find ourselves pushing our own technological agenda!
I would be interested in hearing more about your work.
Cheers
Michael