The first is: more wasteful economically. This seems pretty robust, investments in sub-Saharan Africa have historically generated much less wealth than investments in other countries. Moreover wealth continues to grow via reinvestment.
It’s not clear what you mean by this. Do you mean investments in Africa have generated less wealth for the investor? That might be true, but it doesn’t mean they have generated less wealth overall. How would you measure this?
he second is: more wasteful ethically. This is harder to defend, but I think it is a reasonable conclusion though 90% confidence is a bit silly. While more wealth does result in decreased marginal returns on utility, it also results in faster growth. It’s harder to say which effect dominates. Giving to sub-Saharans is a tradeoff between long term growth in wealth and short term utils. As people get more wealthy, they give more (in absolute terms) to charity. Therefore on the margin is better to increase the amount of wealth in the world (which will increase the amount that people give).
I believe the price of saving a QALY has been increasing much faster than the growth of capital. (Does anyone have a source?) This means it is most effective to donate money now.
On a meta level, arguments against donating now are probably partly motivated by wishful thinking by people who don’t feel like donating money, and should be scrutinized heavily.
The rate of return on the stock market is around 10%. This is much faster than the rate of growth of sub-Saharan economies. Actually foreign aid might have a negative rate of return since most of the transfers are consumed rather than reinvested. Which isn’t a problem per say—eventually you have to convert capital into QALYs even if that means you stop growing it (if you are an effective altruist). The question is how much, and when?
I didn’t actually come up with the argument that investing now and donating later is more efficient. Robin Hanson did, and there has been some back and forth there which I highly recommend (so as not to retread over old arguments).
I believe the price of saving a QALY has been increasing much faster than the growth of capital. (Does anyone have a source?) This means it is most effective to donate money now.
Even if QALYs per dollar decrease exponentially and faster than the growth of capital (which you’ve asserted without argument—I simply think that no one knows), there is still the issue of whether investment followed by donation (to high marginal QALY causes), is more effective than direct donation. Its a very difficult optimization problem and while I don’t know the answer to it, I’m disappointed by how overconfident people are that they know the answer.
Actually foreign aid might have a negative rate of return since most of the transfers are consumed rather than reinvested. Which isn’t a problem per say—eventually you have to convert capital into QALYs even if that means you stop growing it (if you are an effective altruist). The question is how much, and when?
Yes, I agree. This is what I was getting at.
Robin Hanson did, and there has been some back and forth there which I highly recommend (so as not to retread over old arguments).
Thanks for the link! I will read through it.
(Edit: I read through it. It didn’t say anything I didn’t already know. In particular, it never argues that investing now to donate later is good in practice; it only argues this under the assumption that if QALY/dollar remains constant. This is obvious, though.)
Even if QALYs per dollar decrease exponentially and faster than the growth of capital (which you’ve asserted without argument—I simply think that no one knows)
That seems to me to be almost certainly true (e.g. malnutrition and disease have decreased a lot over the last 50 years, and without them there are less ways to buy cheap QALYs). However, you’re right that I didn’t actually research this.
there is still the issue of whether investment followed by donation (to high marginal QALY causes), is more effective than direct donation.
Huh? If we’re assuming QALY/dollar decreases faster than your dollars increase, then doesn’t it follow that you should buy QALYs now? I don’t understand your point here.
This is much faster than the rate of growth of sub-Saharan economies.
Depends on the country:
You cannot cherry pick a single year (a pretty non-representative year given the recession) in which the growth of a few sub-Saharan African countries was faster than the average growth of the stock market. to refute the claim that the stock market grows faster than sub-Saharan economies. A more complete data set shows that indeed the sub-Saharan economy has grown much slower than the stock market. This shouldn’t be a controversial point.
Huh? If we’re assuming QALY/dollar decreases faster than your dollars increase, then doesn’t it follow that you should buy QALYs now? I don’t understand your point here.
So what you are arguing is that the most efficient use of money to gain QALYs (not the average) has decreased exponentially and faster than the growth of capital over time? That seems very difficult to argue while taking into account increased knowledge and technology. But I have no idea how to calculate that.
You cannot cherry pick a single year (a pretty non-representative year given the recession) in which the growth of a few sub-Saharan African countries was faster than the average growth of the stock market.
I didn’t cherry-pick anything; that was the first google image result, so it’s the one I linked to. I didn’t think it’s any different from a typical year. Is it? If so, what was special that year? If you’re concerned that the US was in a recession, you can simply compare sub-Saharan Africa to the typical 6-7% stock market returns instead of comparing to the GDP growth of the US in that year.
So what you are arguing is that the most efficient use of money to gain QALYs (not the average) has decreased exponentially and faster than the growth of capital over time?
Yes!
That seems very difficult to argue while taking into account increased knowledge and technology. But I have no idea how to calculate that.
I don’t claim to be able to exactly calculate it, but some quick back-of-the-envelope calculations suggest that it is true. For example, consider this from slatestarcodex:
[...] in the 1960s, the most cost-effective charity was childhood vaccinations, but now so many people have donated to this cause that 80% of children are vaccinated and the remainder are unreachable for really good reasons (like they’re in violent tribal areas of Afghanistan or something) and not just because no one wants to pay for them. In the 1960s, iodizing salt might have been the highest-utility intervention, but now most of the low-iodine areas have been identified and corrected. While there is still much to be done, we have run out of interventions quite as easy and cost-effective as those. And one day, God willing, we will end malaria and maybe we will never see a charity as effective as the Against Malaria Fund again.
While I don’t have the exact numbers, this seems to me to be self-evidently true if you know any history (to the point where I would say it is the onus of the “invest instead of donating” camp to prove this false).
Finally someone else who is thinking like an investor. See my longer comment below for more along this line of thought.
The other advantage of investing is that you have a degree of self-insurance against adverse events. This will help you and your family avoid falling on social safety nets (which could be seen as “negative EA”). Typically EA starts by thinking about foreign countries, but perhaps EA should start at home and move outward.
Additionally, investing and waiting helps deal with the problem of values. Right now, EA suffers from a lack of good moral arguments for what to do with money. The current dominant approaches depend on very narrow and politicized moral assumptions. Waiting will allow more time for better arguments to emerge and to see which direction the world is going.
a lack of good moral arguments [...] very narrow and politicized moral assumptions
What sort of thing would you consider “good moral arguments”? What makes something “politicized”?
(It looks to me as if the EAs have pretty good moral arguments already, and as if they’re politicized only in the sense that anything of importance where one set of interests trades off against another will attract political controversy.)
Waiting will allow more time for better arguments to emerge
People have been thinking fairly seriously about ethics, responsibilities towards other people, etc., for a very long time already. When do you expect better arguments to emerge, and why?
The other advantage of investing is that you have a degree of self-insurance [...] negative EA [...] perhaps EA should start at home and move outward.
You’ve suggested elsewhere in this thread that EAs may really be motivated not by a desire to help poor people but by a desire to look good at Bay Area parties. It’s reasonable to wonder about such things, for sure. How sure are you that the position you’re adopting here—which seems scarcely distinguishable from “stop worrying about poor people in poor countries and take the actions that tend to enrich yourself as much as possible” isn’t likewise motivated by a desire to have more money?
What sort of thing would you consider “good moral arguments”? What makes something “politicized”?
All moral arguments are either politicized or have the potential to be.
My impression is that EA assumes a utilitarian framework which weights people the same and operates mostly in near-mode. EA towards the third world has never been shown to be morally superior to advancing science, medicine, technology, X-risk reduction, or investing the money until better opportunities emerge.
Better moral arguments would involve taking a broader look at the future of humanity, and the current geopolitical and civilizational state of the world. EA does pay some attention to existential risks, but there is insufficient attention to risks that are short of existential risks. Think of all the risks an individual or society faces over a decade. Even if you take a bunch of low probability risks, the probability of at least one bad event happening is going to be higher.
My comment about Bay Area parties is suggesting that if EA’s conclusions are all politically palatable, then this could be due to hidden political assumptions, or thinking in a bounded way.
It’s certainly plausible that people are biased in favor of keeping their money in their pockets. But perhaps their pockets should be the default place to keep their money until compelling reasons appear to part with it.
All moral arguments are either politicized or have the potential to be.
Your complaint was about moral assumptions rather than moral arguments. I would say the same about moral assumptions as you do about moral arguments, and suggest that therefore calling someone’s moral assumptions “politicized” is not a cogent criticism unless you go further and explain why their politicitization is worse than every other assumption’s.
Better moral arguments would involve taking a broader look at the future of humanity, [...]
I think there may be two different issues here that are at risk of getting mixed up. (1) If your aim is to make things better for the world’s poorest people, or to optimize net utility (which at least superficially looks like calling for very similar actions), you need to consider the long as well as the short term, and it might turn out that those goals are best achieved by actions whose short-term consequences look bad for poor people or bad for net utility. (2) You might care more about other things than net utility or the plight of the least fortunate.
Of these, it seems to me that #1 is the one it’s more helpful to discuss (because pure disagreements on values tend not to make for fruitful discussions) and is, at least ostensibly, the focus of most of the actual discussion here—but unlike #2 is isn’t actually a moral argument.
I do, for the avoidance of doubt, agree with #1. And it’s not impossible that putting money into the US stock market does more expected long-term good for the world’s poorest people than giving them money or buying them malaria nets. But the arguments deployed in support of that argument in this thread seem to me to be terrible in the same kind of way as the arguments for conventional EA are alleged to be, but with less excuse; and thinly disguised self-interest seems like an awfully plausible explanation for that.
I suppose I should make some attempt to justify my claim that the arguments are terrible, or at least explain it. Here is what I think is the best example.
Both Salemicus (in the OP) and pianoforte611 (a few articles upthread) seem just to tacitly assume that whatever produces the most growth must be best overall, and that this means not transferring any wealth to poorer people whose growth rate is lower. This seems to me exactly parallel to just tacitly assuming that whatever gives the most short-run benefit to the world’s poorest people must be best overall. And I think it’s flatly wrong. Here is a toy model to explain why I think so.
Consider a world made up of two populations, the Rich and the Poor. The sizes of these populations are, let’s say, in the fixed ratio 1:a. At time t they have wealth per capita of u(t),v(t). Utility per person is proportional to log wealth. Wealth grows exponentially: u’ = pu, v’ = qv. We suppose u(0)>v(0) -- the rich are richer than the poor—and p>q—the rich generate more growth than the poor. We discount everyone’s future utility by a factor exp(-rt); same discount rate r for rich and poor. And, finally, the rich give some fraction of their wealth to the poor, so the actual differential equations are u’ = (p-c)u, v’ = qv+cu.
So, the solution of these differential equations is a linear combination of exponentials that I won’t bother you with; then the net utility looks like the integral from 0 to infinity of exp(-rt) log(linear combination of exponentials) which, so far as I know, doesn’t have a closed form; so I used Mathematica to do it numerically.
The resulting plot of net utility against donation level c is typically not monotone decreasing; its global maximum is at a small but positive value. For instance, let’s consider the Rich to consist of the US plus Western Europe (population about 720M) and the Poor to consist of sub-Saharan Africa (population about 800M) so crudely take a=1; take u(0)=40000 and v(0)=1700 (rough estimates of GDP per capita; not the same as wealth but it’ll do; ratio of wealth will probably be much larger); take p=0.06 and q=0.03, although in fact I think sub-Saharan Africa is doing better than that lately; and take r=0.02 (which I think is lower than most people’s discount rates; higher discount rates tend to favour more charity).
The resulting curve has its maximum at about c=0.01; about 1% of GDP in the Rich countries should be given to the Poor to maximize long-term net utility. Diddling with the parameters doesn’t change this hugely; over a wide range of values we get optima roughly in the range 0.001 .. 0.02.
As long as the discount rate is fairly small, this model will never recommend a value of c much bigger than half the difference in growth rates—because if c is bigger than that, the Poor get richer faster than the Rich do and in the long run they are richer than the Rich :-). (A better model would allow c to vary, and I bet it would end up recommending larger values of c while the Poor are much poorer than the Rich.)
I think most of this discussion just boils down into a difference of values. You suggest that donating to the world’s poorest people seems like to way to increase net utility, but this depends on a utility function and moral framework that I am questioning. I have alluded to at least two objections, which is that this outlook seems too near-mode, and it assumes that people should be weighted the same. I agree with you that getting into a deeper discussion of values would not be fruitful.
Your model is interesting, but it still looks like it weights utility of different people the same, and it doesn’t take into account resulting incentives and externalities.
It’s possible to imagine a value system and geopolitical picture where saving lives in the third world has zero utility, weakly positive utility, or weakly negative utility. If so, then investing in people who are productive at least does something with your money.
Or my suspicions could be wrong, and there could be flow-through effects that I would find compelling. If I had a comprehensive and strong alternative EA approach and clearly superior value system, then I could be more explicit.
I do want to clarify that I don’t consider investing in the stock market to be EA, at least, not very strong EA. I see the stock market more as a way to grow money so that you can do EA later.
it still looks like it weights utility of different people the same
It does, but if you (say) care about the utility of the Rich 100x more than you do about the utility of the Poor, you can compensate for that just by pretending there are 100x more Rich people. (More likely, of course, what you care about more is your own utility and that of people close to you. The effect is fairly similar.)
It’s possible to imagine a value system and geopolitical picture where saving lives in the third world has zero utility [...]
Yes, it’s possible. I don’t (given my own values and epistemic state) see any reason to take that possibility any more seriously than, say, the possibility that increased economic growth in affluent nations is a bad thing overall. (Which it could be, likewise, given some value systems—e.g., ones that strongly disvalue inequality as such—or some geopolitical situations—e.g., ones in which humanity is badly threatened by harms likely to be accelerated by more prosperous rich nations, such as harmful climate change or “unfriendly” AI.)
I don’t consider investing in the stock market to be [...] very strong EA.
OK. So your position differs from the one Salemicus was espousing in the OP; fair enough.
It’s not clear what you mean by this. Do you mean investments in Africa have generated less wealth for the investor? That might be true, but it doesn’t mean they have generated less wealth overall. How would you measure this?
I believe the price of saving a QALY has been increasing much faster than the growth of capital. (Does anyone have a source?) This means it is most effective to donate money now.
On a meta level, arguments against donating now are probably partly motivated by wishful thinking by people who don’t feel like donating money, and should be scrutinized heavily.
The rate of return on the stock market is around 10%. This is much faster than the rate of growth of sub-Saharan economies. Actually foreign aid might have a negative rate of return since most of the transfers are consumed rather than reinvested. Which isn’t a problem per say—eventually you have to convert capital into QALYs even if that means you stop growing it (if you are an effective altruist). The question is how much, and when?
I didn’t actually come up with the argument that investing now and donating later is more efficient. Robin Hanson did, and there has been some back and forth there which I highly recommend (so as not to retread over old arguments).
Even if QALYs per dollar decrease exponentially and faster than the growth of capital (which you’ve asserted without argument—I simply think that no one knows), there is still the issue of whether investment followed by donation (to high marginal QALY causes), is more effective than direct donation. Its a very difficult optimization problem and while I don’t know the answer to it, I’m disappointed by how overconfident people are that they know the answer.
You didn’t adjust for inflation; it’s actually around 6 or 7%.
Depends on the country:
http://en.wikipedia.org/wiki/Gross_domestic_product#/media/File:Gdp_real_growth_rate_2007_CIA_Factbook.PNG
Yes, I agree. This is what I was getting at.
Thanks for the link! I will read through it.
(Edit: I read through it. It didn’t say anything I didn’t already know. In particular, it never argues that investing now to donate later is good in practice; it only argues this under the assumption that if QALY/dollar remains constant. This is obvious, though.)
That seems to me to be almost certainly true (e.g. malnutrition and disease have decreased a lot over the last 50 years, and without them there are less ways to buy cheap QALYs). However, you’re right that I didn’t actually research this.
Huh? If we’re assuming QALY/dollar decreases faster than your dollars increase, then doesn’t it follow that you should buy QALYs now? I don’t understand your point here.
You cannot cherry pick a single year (a pretty non-representative year given the recession) in which the growth of a few sub-Saharan African countries was faster than the average growth of the stock market. to refute the claim that the stock market grows faster than sub-Saharan economies. A more complete data set shows that indeed the sub-Saharan economy has grown much slower than the stock market. This shouldn’t be a controversial point.
So what you are arguing is that the most efficient use of money to gain QALYs (not the average) has decreased exponentially and faster than the growth of capital over time? That seems very difficult to argue while taking into account increased knowledge and technology. But I have no idea how to calculate that.
I didn’t cherry-pick anything; that was the first google image result, so it’s the one I linked to. I didn’t think it’s any different from a typical year. Is it? If so, what was special that year? If you’re concerned that the US was in a recession, you can simply compare sub-Saharan Africa to the typical 6-7% stock market returns instead of comparing to the GDP growth of the US in that year.
Yes!
I don’t claim to be able to exactly calculate it, but some quick back-of-the-envelope calculations suggest that it is true. For example, consider this from slatestarcodex:
http://slatestarcodex.com/2013/04/05/investment-and-inefficient-charity/
While I don’t have the exact numbers, this seems to me to be self-evidently true if you know any history (to the point where I would say it is the onus of the “invest instead of donating” camp to prove this false).
Finally someone else who is thinking like an investor. See my longer comment below for more along this line of thought.
The other advantage of investing is that you have a degree of self-insurance against adverse events. This will help you and your family avoid falling on social safety nets (which could be seen as “negative EA”). Typically EA starts by thinking about foreign countries, but perhaps EA should start at home and move outward.
Additionally, investing and waiting helps deal with the problem of values. Right now, EA suffers from a lack of good moral arguments for what to do with money. The current dominant approaches depend on very narrow and politicized moral assumptions. Waiting will allow more time for better arguments to emerge and to see which direction the world is going.
What sort of thing would you consider “good moral arguments”? What makes something “politicized”?
(It looks to me as if the EAs have pretty good moral arguments already, and as if they’re politicized only in the sense that anything of importance where one set of interests trades off against another will attract political controversy.)
People have been thinking fairly seriously about ethics, responsibilities towards other people, etc., for a very long time already. When do you expect better arguments to emerge, and why?
You’ve suggested elsewhere in this thread that EAs may really be motivated not by a desire to help poor people but by a desire to look good at Bay Area parties. It’s reasonable to wonder about such things, for sure. How sure are you that the position you’re adopting here—which seems scarcely distinguishable from “stop worrying about poor people in poor countries and take the actions that tend to enrich yourself as much as possible” isn’t likewise motivated by a desire to have more money?
All moral arguments are either politicized or have the potential to be.
My impression is that EA assumes a utilitarian framework which weights people the same and operates mostly in near-mode. EA towards the third world has never been shown to be morally superior to advancing science, medicine, technology, X-risk reduction, or investing the money until better opportunities emerge.
Better moral arguments would involve taking a broader look at the future of humanity, and the current geopolitical and civilizational state of the world. EA does pay some attention to existential risks, but there is insufficient attention to risks that are short of existential risks. Think of all the risks an individual or society faces over a decade. Even if you take a bunch of low probability risks, the probability of at least one bad event happening is going to be higher.
My comment about Bay Area parties is suggesting that if EA’s conclusions are all politically palatable, then this could be due to hidden political assumptions, or thinking in a bounded way.
It’s certainly plausible that people are biased in favor of keeping their money in their pockets. But perhaps their pockets should be the default place to keep their money until compelling reasons appear to part with it.
Your complaint was about moral assumptions rather than moral arguments. I would say the same about moral assumptions as you do about moral arguments, and suggest that therefore calling someone’s moral assumptions “politicized” is not a cogent criticism unless you go further and explain why their politicitization is worse than every other assumption’s.
I think there may be two different issues here that are at risk of getting mixed up. (1) If your aim is to make things better for the world’s poorest people, or to optimize net utility (which at least superficially looks like calling for very similar actions), you need to consider the long as well as the short term, and it might turn out that those goals are best achieved by actions whose short-term consequences look bad for poor people or bad for net utility. (2) You might care more about other things than net utility or the plight of the least fortunate.
Of these, it seems to me that #1 is the one it’s more helpful to discuss (because pure disagreements on values tend not to make for fruitful discussions) and is, at least ostensibly, the focus of most of the actual discussion here—but unlike #2 is isn’t actually a moral argument.
I do, for the avoidance of doubt, agree with #1. And it’s not impossible that putting money into the US stock market does more expected long-term good for the world’s poorest people than giving them money or buying them malaria nets. But the arguments deployed in support of that argument in this thread seem to me to be terrible in the same kind of way as the arguments for conventional EA are alleged to be, but with less excuse; and thinly disguised self-interest seems like an awfully plausible explanation for that.
I suppose I should make some attempt to justify my claim that the arguments are terrible, or at least explain it. Here is what I think is the best example.
Both Salemicus (in the OP) and pianoforte611 (a few articles upthread) seem just to tacitly assume that whatever produces the most growth must be best overall, and that this means not transferring any wealth to poorer people whose growth rate is lower. This seems to me exactly parallel to just tacitly assuming that whatever gives the most short-run benefit to the world’s poorest people must be best overall. And I think it’s flatly wrong. Here is a toy model to explain why I think so.
Consider a world made up of two populations, the Rich and the Poor. The sizes of these populations are, let’s say, in the fixed ratio 1:a. At time t they have wealth per capita of u(t),v(t). Utility per person is proportional to log wealth. Wealth grows exponentially: u’ = pu, v’ = qv. We suppose u(0)>v(0) -- the rich are richer than the poor—and p>q—the rich generate more growth than the poor. We discount everyone’s future utility by a factor exp(-rt); same discount rate r for rich and poor. And, finally, the rich give some fraction of their wealth to the poor, so the actual differential equations are u’ = (p-c)u, v’ = qv+cu.
So, the solution of these differential equations is a linear combination of exponentials that I won’t bother you with; then the net utility looks like the integral from 0 to infinity of exp(-rt) log(linear combination of exponentials) which, so far as I know, doesn’t have a closed form; so I used Mathematica to do it numerically.
The resulting plot of net utility against donation level c is typically not monotone decreasing; its global maximum is at a small but positive value. For instance, let’s consider the Rich to consist of the US plus Western Europe (population about 720M) and the Poor to consist of sub-Saharan Africa (population about 800M) so crudely take a=1; take u(0)=40000 and v(0)=1700 (rough estimates of GDP per capita; not the same as wealth but it’ll do; ratio of wealth will probably be much larger); take p=0.06 and q=0.03, although in fact I think sub-Saharan Africa is doing better than that lately; and take r=0.02 (which I think is lower than most people’s discount rates; higher discount rates tend to favour more charity).
The resulting curve has its maximum at about c=0.01; about 1% of GDP in the Rich countries should be given to the Poor to maximize long-term net utility. Diddling with the parameters doesn’t change this hugely; over a wide range of values we get optima roughly in the range 0.001 .. 0.02.
As long as the discount rate is fairly small, this model will never recommend a value of c much bigger than half the difference in growth rates—because if c is bigger than that, the Poor get richer faster than the Rich do and in the long run they are richer than the Rich :-). (A better model would allow c to vary, and I bet it would end up recommending larger values of c while the Poor are much poorer than the Rich.)
I think most of this discussion just boils down into a difference of values. You suggest that donating to the world’s poorest people seems like to way to increase net utility, but this depends on a utility function and moral framework that I am questioning. I have alluded to at least two objections, which is that this outlook seems too near-mode, and it assumes that people should be weighted the same. I agree with you that getting into a deeper discussion of values would not be fruitful.
Your model is interesting, but it still looks like it weights utility of different people the same, and it doesn’t take into account resulting incentives and externalities.
It’s possible to imagine a value system and geopolitical picture where saving lives in the third world has zero utility, weakly positive utility, or weakly negative utility. If so, then investing in people who are productive at least does something with your money.
Or my suspicions could be wrong, and there could be flow-through effects that I would find compelling. If I had a comprehensive and strong alternative EA approach and clearly superior value system, then I could be more explicit.
I do want to clarify that I don’t consider investing in the stock market to be EA, at least, not very strong EA. I see the stock market more as a way to grow money so that you can do EA later.
It does, but if you (say) care about the utility of the Rich 100x more than you do about the utility of the Poor, you can compensate for that just by pretending there are 100x more Rich people. (More likely, of course, what you care about more is your own utility and that of people close to you. The effect is fairly similar.)
Yes, it’s possible. I don’t (given my own values and epistemic state) see any reason to take that possibility any more seriously than, say, the possibility that increased economic growth in affluent nations is a bad thing overall. (Which it could be, likewise, given some value systems—e.g., ones that strongly disvalue inequality as such—or some geopolitical situations—e.g., ones in which humanity is badly threatened by harms likely to be accelerated by more prosperous rich nations, such as harmful climate change or “unfriendly” AI.)
OK. So your position differs from the one Salemicus was espousing in the OP; fair enough.