The way most people can best contribute to society is to make as much money as possible and donate much of it to a charity that offers a high social return per dollar.
People on LW who would be going into pure research are probably not most people. I don’t think this is true of anyone smart enough to make significant mathematical contributions. For example, I believe I can contribute much (much) more to society than the benchmark you describe.
Anyone smart enough to “make significant mathematical contributions” is also smart enough to make a significant amount of money in finance.
“I believe I can contribute much (much) more to society than the benchmark you describe” How? Although I’ll understand if privacy concerns cause you to not answer.
I’m not sure that this is true. Yes, someone who is smart enough to get into pure maths research will be smart enough to get a decent job in finance, and perhaps earn a few 100k each year, but I’m not sure they’ll necessarily scale to higher levels. I suspect the skills required are not necessarily completely transferable, and the ability to have mathematical insights might not be isomorphic to making repeated sound investments. If the earning is only around 10 times as much, one could argue that in research one might well be able to acheive more.
If the earning is only around 10 times as much, one could argue that in research one might well be able to acheive more.
But then you take the higher paying job and use the extra money to hire nine researchers to study whatever really important topic you would otherwise be researching.
Paul’s decision to take the high-paying job doesn’t cause the other smart people to do likewise. If there’s currently an excess of good people wanting to do pure mathematical research over funding to pay for them, then Paul’s going into finance won’t change that.
That’s a good point. I may be spending too much time on LW and thinking about decisions in an abstract setting where one expects all the simlar actors to act essentially the same way using TDT or UDT. Or that may just be a poor excuse for me not thinking.
Right, but if you ‘earned’ the money as a financier in part by duping a hundred people into predatory mortgage loans that cost them their homes, and then the college enrollment rate of those hundred people’s kids gets cut in half as a result, have you really caused a net increase in the amount of research being done?
Assuming your primary talents/interests/passions are in something like academic research rather than practical finance, I think it’s very challenging to net $100K+ after taxes and lifestyle expenses (you’re eating in restaurants and taking taxis because you are working 80+ hr weeks, etc.) without creating large negative externalities.
and then the college enrollment rate of those hundred people’s kids gets cut in half as a result, have you really caused a net increase in the amount of research being done?
Yes. Most undergraduates don’t become researchers, and most of those who do won’t specialize in the most important topics.
Counterfactual: if you did not enter finance, would significantly fewer people get duped, lose their homes, their access to a college education? Does your marginal contribution to those negative externalities exceed the good you can do with earning that extra money?
Yes, unless you think that, on average, the finance-minded person who you out-competed for the job will give up and go home, or will switch to something like research.
Unlike, say, posts in a state bureaucracy, where there may be a fixed number of positions available, the supply of jobs in the finance industry is elastic with respect to the number of people seeking jobs...if you can’t get a job with Goldman Sachs, you can try to convince a smaller firm that wasn’t planning on hiring to take you on anyway, or you can try to raise money with friends to start your own fund.
In any given economy, there are a fixed number of arbitrage opportunities that (a) pose minimal negative externalities, (b) are lucrative enough to pay your $100K plus salary, and (c) can be discovered and exploited by a person of average talent. In most of the Western world at the moment, there are significantly more financiers than would be required to exploit these opportunities; the remainder are necessarily exploiting opportunities that fail one or more of the criteria. We are assuming, for purposes of the argument, that you want to make a lot of money but you’re not a finance genius, so if you add another financier to the economy by switching careers, you must be increasing negative externalities.
You need to consider your marginal “duping”. If the same amount of duping would have taken place had you not been in the industry than your duping imposes zero social costs.
$100K+ jobs also create the enormous positive externality of generating lots of tax revenue.
Er… I agree with you about needing to consider one’s marginal “duping”, vs. the duping that would be done by one’s substitute.
But, by the same token, surely you also need to consider one’s marginal impact on tax revenue, vs. the impact of the person who would otherwise have one’s job.
Yeah, well, if you’re donating $100,000 a year to charity, the marginal impact will be (what the average worker contributes to charity - $100,000) * (the tax rate) since charitable contributions are tax deductible.
People on LW who would be going into pure research are probably not most people. I don’t think this is true of anyone smart enough to make significant mathematical contributions. For example, I believe I can contribute much (much) more to society than the benchmark you describe.
Anyone smart enough to “make significant mathematical contributions” is also smart enough to make a significant amount of money in finance.
“I believe I can contribute much (much) more to society than the benchmark you describe” How? Although I’ll understand if privacy concerns cause you to not answer.
I’m not sure that this is true. Yes, someone who is smart enough to get into pure maths research will be smart enough to get a decent job in finance, and perhaps earn a few 100k each year, but I’m not sure they’ll necessarily scale to higher levels. I suspect the skills required are not necessarily completely transferable, and the ability to have mathematical insights might not be isomorphic to making repeated sound investments. If the earning is only around 10 times as much, one could argue that in research one might well be able to acheive more.
But then you take the higher paying job and use the extra money to hire nine researchers to study whatever really important topic you would otherwise be researching.
And where do you get these nine researchers if the smart people have all decided to go into finance?
Paul’s decision to take the high-paying job doesn’t cause the other smart people to do likewise. If there’s currently an excess of good people wanting to do pure mathematical research over funding to pay for them, then Paul’s going into finance won’t change that.
That’s a good point. I may be spending too much time on LW and thinking about decisions in an abstract setting where one expects all the simlar actors to act essentially the same way using TDT or UDT. Or that may just be a poor excuse for me not thinking.
Right, but if you ‘earned’ the money as a financier in part by duping a hundred people into predatory mortgage loans that cost them their homes, and then the college enrollment rate of those hundred people’s kids gets cut in half as a result, have you really caused a net increase in the amount of research being done?
Assuming your primary talents/interests/passions are in something like academic research rather than practical finance, I think it’s very challenging to net $100K+ after taxes and lifestyle expenses (you’re eating in restaurants and taking taxis because you are working 80+ hr weeks, etc.) without creating large negative externalities.
Yes. Most undergraduates don’t become researchers, and most of those who do won’t specialize in the most important topics.
Counterfactual: if you did not enter finance, would significantly fewer people get duped, lose their homes, their access to a college education? Does your marginal contribution to those negative externalities exceed the good you can do with earning that extra money?
EDIT: s/network externalities/negative externalities
Yes, unless you think that, on average, the finance-minded person who you out-competed for the job will give up and go home, or will switch to something like research.
Unlike, say, posts in a state bureaucracy, where there may be a fixed number of positions available, the supply of jobs in the finance industry is elastic with respect to the number of people seeking jobs...if you can’t get a job with Goldman Sachs, you can try to convince a smaller firm that wasn’t planning on hiring to take you on anyway, or you can try to raise money with friends to start your own fund.
In any given economy, there are a fixed number of arbitrage opportunities that (a) pose minimal negative externalities, (b) are lucrative enough to pay your $100K plus salary, and (c) can be discovered and exploited by a person of average talent. In most of the Western world at the moment, there are significantly more financiers than would be required to exploit these opportunities; the remainder are necessarily exploiting opportunities that fail one or more of the criteria. We are assuming, for purposes of the argument, that you want to make a lot of money but you’re not a finance genius, so if you add another financier to the economy by switching careers, you must be increasing negative externalities.
You need to consider your marginal “duping”. If the same amount of duping would have taken place had you not been in the industry than your duping imposes zero social costs.
$100K+ jobs also create the enormous positive externality of generating lots of tax revenue.
Er… I agree with you about needing to consider one’s marginal “duping”, vs. the duping that would be done by one’s substitute.
But, by the same token, surely you also need to consider one’s marginal impact on tax revenue, vs. the impact of the person who would otherwise have one’s job.
I agree.
Yeah, well, if you’re donating $100,000 a year to charity, the marginal impact will be (what the average worker contributes to charity - $100,000) * (the tax rate) since charitable contributions are tax deductible.