Proportional giving was designed for people who didn’t even necessarily want to be intrinsically motivated to give money (e.g. paying taxes or perhaps tithing to a church). If you want to raise money from such people, proportional donation aligns the incentives much better than threshold.
That said, there are a couple reasons why it’s still useful for effective altruists:
The thing you mentioned about near mode.
As you get older, you gain more ability to buy utility at good prices: for instance, kids become increasingly expensive as they age.
It sets a norm that’s easier for people to follow. For instance, fewer people would join Giving What We Can if the pledge were “give everything above $X” instead of “give 10% of your income”.
It’s more inclusive. Not everyone can give away everything above (e.g.) US$36k. A lot more people can give away 10% of income.
Nevertheless, many effective altruists (e.g. Toby Ord) do practice the fixed-income approach.
Damn, I meant to mention him and then forgot. (Is it really many effective altruists? He’s the only example I know of, but I haven’t gone looking very hard.)
Will MacAskill does, and I think many other CEA employees. I think Jeff Kaufman and Julia Wise do an ad-hoc thing but similar in that they mostly don’t treat the percentage donated as relevant—they set their personal allowance based on making their best effort without taking into account how much they’re currently earning. (I’m not 100% sure this is accurate though.) I don’t know the giving habits of many other EtGers but I wouldn’t be surprised if they used a broadly similar method to Jeff and Julia.
As you get older, you gain more ability to buy utility at good prices: for instance, kids become increasingly expensive as they age.
Perhaps because my economic intuition isn’t that sharp, I’m having trouble connecting the dots on this statement. I’m not seeing how the example implies the assertion, and I’m having trouble coming up with another example. Can you expand on this?
As kids grow older, they become more expensive because they increasingly demand more money.
The reason they demand more money is because money becomes more valuable to them as they age.
The reason money becomes more valuable to them as they age is because they can buy more utility per dollar.
(I don’t know if this is true, I’m just explaining the argument).
Analogous to: People who like chocolate more eat more chocolate, people will spend more money when the store has a special sales deal, etc. Lower prices//higher benefits drive up demand.
Suppose that I weight my own utility such that I’m willing to buy utility at 10 utils per dollar. As gjm noted, this exchange rate should stay constant unless my utility weightings change. But suppose that there are a number of things that provide utility at this rate:
playing video games
drinking alcohol
renting fancy cars
owning a house
having children
These things become available increasingly late in life, so my consumption would increase even though I spent money rationally (well, rationally_{weighted utilitarianism}) throughout.
I’m still confused about how kids becoming more expensive is an example of becoming an increasingly good utility deal. Doesn’t it sound like the opposite? Or do you assume that the utility from parenting goes up faster as the children age than the cost does?
It doesn’t matter how the utility is distributed, just that it averages out to 10 utils per dollar (such that having the kid is a good buy overall), while the costs rise.
I am fairly confused as well, but the parent post might mean opportunity costs.
If when you are young you can buy 10 utilons per dollar and when you are older you can get 20 utilons per dollar then spending the same amount of dollars on your kids represents a greater “loss” of utilons at the later age.
Proportional giving was designed for people who didn’t even necessarily want to be intrinsically motivated to give money (e.g. paying taxes or perhaps tithing to a church). If you want to raise money from such people, proportional donation aligns the incentives much better than threshold.
That said, there are a couple reasons why it’s still useful for effective altruists:
The thing you mentioned about near mode.
As you get older, you gain more ability to buy utility at good prices: for instance, kids become increasingly expensive as they age.
It sets a norm that’s easier for people to follow. For instance, fewer people would join Giving What We Can if the pledge were “give everything above $X” instead of “give 10% of your income”.
It’s more inclusive. Not everyone can give away everything above (e.g.) US$36k. A lot more people can give away 10% of income.
Nevertheless, many effective altruists (e.g. Toby Ord) do practice the fixed-income approach.
Damn, I meant to mention him and then forgot. (Is it really many effective altruists? He’s the only example I know of, but I haven’t gone looking very hard.)
It’s the basis for Giving What We Can’s Further Pledge. I know of a few other people who have taken it, either implicitly or explicitly.
Gotcha. Thanks.
Will MacAskill does, and I think many other CEA employees. I think Jeff Kaufman and Julia Wise do an ad-hoc thing but similar in that they mostly don’t treat the percentage donated as relevant—they set their personal allowance based on making their best effort without taking into account how much they’re currently earning. (I’m not 100% sure this is accurate though.) I don’t know the giving habits of many other EtGers but I wouldn’t be surprised if they used a broadly similar method to Jeff and Julia.
Julia and I handle our donations differently:
Everything Julia earns is donated, after taxes.
I pick a percentage of my income at the beginning of the year to be donated.
Last year I went for 30%, this year I’m going for 33%.
EDIT: As of 2014-07-15 we’re now using a simpler system: we both donate half of what we earn.
Perhaps because my economic intuition isn’t that sharp, I’m having trouble connecting the dots on this statement. I’m not seeing how the example implies the assertion, and I’m having trouble coming up with another example. Can you expand on this?
As kids grow older, they become more expensive because they increasingly demand more money.
The reason they demand more money is because money becomes more valuable to them as they age.
The reason money becomes more valuable to them as they age is because they can buy more utility per dollar.
(I don’t know if this is true, I’m just explaining the argument).
Analogous to: People who like chocolate more eat more chocolate, people will spend more money when the store has a special sales deal, etc. Lower prices//higher benefits drive up demand.
Suppose that I weight my own utility such that I’m willing to buy utility at 10 utils per dollar. As gjm noted, this exchange rate should stay constant unless my utility weightings change. But suppose that there are a number of things that provide utility at this rate:
playing video games
drinking alcohol
renting fancy cars
owning a house
having children
These things become available increasingly late in life, so my consumption would increase even though I spent money rationally (well, rationally_{weighted utilitarianism}) throughout.
I’m still confused about how kids becoming more expensive is an example of becoming an increasingly good utility deal. Doesn’t it sound like the opposite? Or do you assume that the utility from parenting goes up faster as the children age than the cost does?
It doesn’t matter how the utility is distributed, just that it averages out to 10 utils per dollar (such that having the kid is a good buy overall), while the costs rise.
I am fairly confused as well, but the parent post might mean opportunity costs.
If when you are young you can buy 10 utilons per dollar and when you are older you can get 20 utilons per dollar then spending the same amount of dollars on your kids represents a greater “loss” of utilons at the later age.