In a recent Facebook status update, Eliezer Yudkowsky asked a question:

Does the causal model for GiveDirectly's positive effects imply that the government of those countries could achieve the same effects by printing money in the local currency and giving the same amount to the same recipients? "Yes" is a legitimate answer because it's a dreadful truth that many governments around the world are not increasing their money supply enough, and also that choosing the right recipients can redistribute value productively even when supplies of medium-of-exchange are already sufficient.

My first thought was object-level; the obvious answer is that some fraction of the money given will eventually be converted into imports, transferring the burden of inflation out and onto richer countries which can easily afford it. This seems plausible. If true, it implies that we should multiply our effectiveness estimates by dImports/d$, which is (asspull) 0.5. By this line of reasoning, direct giving is less effective than we thought, but still a reasonably good deal.

My second thought was that it's likely true that some developing country governments could improve their economies by printing and distributing money, but they won't because they're corrupt, and giving directly is a workaround to force that policy upon them. This seems plausible at first, but it feels forced; the leaders' incentives here are ambiguous, not clearly aligned against this sort of policy.

My third thought was that it's likely true that developing countries' governments could improve their economies by printing and distributing money, and they might not know this.

Sanity check. What sort of people do the poorest countries' governments have, in their economic advisory roles? Is anyone making a serious effort to connect good economists with governments that need them?

If developing countries are short on competent economic advisors at the top levels, and no one is working to fix this, then funding that charity would outperform direct giving by multiple orders of magnitude. But what reason do we have to think that a well-placed economist can make a difference? Well, history does contain at least one big, salient success story: Brazil, where a clever scheme halted hyperinflation and turned the economy around. And on a smaller scale, Otjivero-Namibia.

So now I have some questions for the efficient altruism community:

 - Which developing nations have competent economic advisors, and which ones need them?
 - If a developing nation's leader needs good economic advisors to fill his/her cabinet, does he/she get them?
 - Do any nations have economic problems that seem especially amenable to fixing by clever economists?