Saturday, June 22, 2013

Establishing a Prize: A Potent Approach to Philanthropy

Here's an advance look at my next The Life Well-Led column in the Mensa publication, The Intelligencer. 

I haven't submitted it yet, so your feedback is particularly welcome.

 The Life Well-Led
by Marty Nemko

A Bang-for-the-Buck Approach to Charitable Giving

My previous charitable donations haven't yielded sufficient benefit. For example, I funded the development of an online course for teachers of gifted kids. It was garbage.

Before wasting more money, I've done some thinking and research on how to get the most bang from my charity bucks. Perhaps the results of my exploration and the unusual charitable scheme I then concocted might help you in making wise donations.

The building blocks
1. Perhaps not surprising, as a Mensan, I value intelligence. So I'd like to invest my money in intelligent people who are working on improving intelligence. While, of course, brainpower can be used for good or ill, improving humankind's intelligence is a potent approach to enhancing civilization.

2. Funding a prize for the best research on improving intelligence would encourage many people to work toward that goal.

3. Restricting the prize to people at the end of doctoral training seems optimal:  It's late enough in the person's career for the selection committee to be able to validly assess nominees' potential but early enough to greatly affect how influential s/he is likely to be, for example, whether s/he gets a post at Harvard or at a less prestigious institution.

4. The prize should be administered by a prestigious organization. That adds prestige to the prize, which in turn means the prize's size can be smaller, which could enable me to fund more than one prize.

5. The organization must have a mechanism for broadly soliciting nominees for the prize, and be willing and able to assemble a strong committee to review the proposals. Alternatively, the committee could, instead of soliciting and reviewing proposals, pick the winner by reviewing the abstracts of presentations by doctoral students or recent graduates at major conferences. 

What have I done?
With those as guiding principles, here is what I have done: I have just established The Nemko Prize For the Study of the Biology of Cognition. I would have preferred a narrower focus: the biology of intelligence but the best organization to administer the prize, the Society for Neuroscience (SfN,) wanted the broader scope. SfN is otherwise ideal: It is the world's largest and most prestigious organization focusing on brain research, consisting of 42,000 researchers, including most of the field's luminaries. Also, SfN already administers a number of other prizes and has a proven mechanism for soliciting and reviewing nominees.  (The photo above is of a woman receiving an SfN-administered prize.)

The winner of the Nemko Prize will receive $2,500 but SfN is charging me $7,500. I'm okay with that because that includes the costs of soliciting and reviewing nominations and of travel for the winner to attend SfN's annual meeting, invaluable for a young researcher.

So, for $7,500, the world's neuroscience doctoral students will be incented to do their dissertation on the crucial biological basis of cognition and the best of those students will get a significant career boost. Relative to most other $7,500 donations, I believe that has greater potential to do good. Who knows? Maybe it will even result in more candidates for Mensa!

My plan is to endow the prize as a perpetuity but SfN is allowing me to try it out for three years.

I believe it's often wiser to donate to such a charitable venture than to give the money to family members. Too often, the family member doesn't really need the money and/or the largesse encourages them to sit on their butts--the so-called welfare mentality. I've seen many adult children of wealth,  so-called trust fund babies, be rendered unproductive because their parents gave them "welfare." Thus, charitable giving can be key not only to your life being well-led but to your family's.


Anonymous said...

How much money must you allocate in order to produce 7500 in perpetuity? Do you have multiple millions of dollars in your estate? That sounds facetious but I do not mean it that way. I mean this sincerely. Thanks.

Marty Nemko said...

$150,000. They invest the money in something that has a long-term expected return of 5%. So the interest on that is $7,500. Of course, worst case, the investment returns less than 5%, in which case the endowment eventually runs out of money.


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