Eric Crampton on Bryan Caplan’s EconLog writes (Hat tip MR):
A grad school colleague once hit me up for a donation for his participation in a Habitat for Humanity project in the Philippines. While he agreed that comparative advantage would dictate that he instead work more in the States and donate the money to hire folks in the Philippines more competent than him to do the construction work, he also noted that that alternative wouldn’t get him a trip to the Philippines. And, of course, I then declined to subsidise his vacation. In that case, it was pretty clear that the charity was bundling large benefits for solicitor/participants with its fundraising mechanism: the charity that bundles private benefits for participants with its activities will attract more participants.
We have similar vacation subsidies in SG except that taxpayers here do not get to decline (I may be wrong on this, but I do think overseas expeditions are partly subsidized by the state even if most of the costs are borne by the participants). I wonder if the resources foregone (ie the opportunity cost of the taxes, participants time, SIF’s administrative costs etc) might have done more for the economic development of these societies in private hands…