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Nacional Monte de Piedad Uses a Novel Social-Value Measure for Allocating Grants Among Charities

Author

Listed:
  • Enrique Garza-Escalante

    (Economics Division, CIDE, Mexico City, 01210 México, D.F.)

  • Arturo de la Torre

Abstract

Allocating grants among charities presents several difficulties. Evaluating trade-offs is emotionally difficult and time consuming for trustees; charities that do not receive support complain of favoritism; and sufficient resources are not available to help all charities. This paper presents a unique and flexible metric that maps money granted to units of social value, which we use in a mixed-integer programming model to assist Nacional Monte de Piedad in its annual grant-allocation process. The model captures complex interactions in a simple, understandable, and representative way.

Suggested Citation

  • Enrique Garza-Escalante & Arturo de la Torre, 2015. "Nacional Monte de Piedad Uses a Novel Social-Value Measure for Allocating Grants Among Charities," Interfaces, INFORMS, vol. 45(6), pages 514-528, December.
    • Handle: RePEc:inm:orinte:v:45:y:2015:i:6:p:514-528
    DOI: 10.1287/inte.2015.0811
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    References listed on IDEAS

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    1. Dimitris Bertsimas & Ramazan Demir, 2002. "An Approximate Dynamic Programming Approach to Multidimensional Knapsack Problems," Management Science, INFORMS, vol. 48(4), pages 550-565, April.
    2. Piet Verheyen, 1998. "The Missing Link in Budget Models of Nonprofit Institutions: Two Practical Dutch Applications," Management Science, INFORMS, vol. 44(6), pages 787-800, June.
    3. H. Martin Weingartner, 1966. "Capital Budgeting of Interrelated Projects: Survey and Synthesis," Management Science, INFORMS, vol. 12(7), pages 485-516, March.
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    Cited by:

    1. Garza Escalante, Enrique F. & Paniagua Fernandez, L. Fernando, 2016. "Preparing transitions in public services: Payoff dimension, value estimation, schedule and budget computation," Socio-Economic Planning Sciences, Elsevier, vol. 55(C), pages 36-46.

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