Rational Altruist

Adventures of a would-be do-gooder.

Month: February, 2013

Risk aversion and investment (for altruists)

Suppose I hope to use my money to do good some day, but for now I am investing it and aiming to maximize my returns. I face the question: how much risk should I be willing to bear? Should I pursue safe investments, or riskier investments with higher returns?

My knee-jerk response is to say “An altruist should be risk neutral. If you have twice as much money, you can do twice as much good. Sure, there are some diminishing returns, but my own investment is minuscule compared to an entire world full of philanthropists. So in the regime where I am investing, returns are roughly linear.” (I might revise this picture if I thought that I was a very unusual philanthropist, and that few others would invest in the same charitable causes as me—in that case I alone might represent a significant fraction of charitable investment in my causes of choice, so I should expect to personally run into diminishing returns.)

But on closer inspection there is something fishy about this reasoning. I don’t have great data on the responsiveness of charitable giving to market performance, but at the individual level it seems that the elasticity of charitable giving to income is about 1—if I am 50% richer (in one possible world than another), I tend to give 50% more to charity. So in worlds where markets do well, we should expect charities to have more money. If markets (rather, the average investor) do 10% better, I should expect 10% more money to be available for any particular charitable cause, regardless of how many donors it has. Read the rest of this entry »

Advertisements

Why might the future be good?

When talking about the future, I often encounter two (quite different) stories describing why the future might be good:

  1. Decisions will be made by people whose lives are morally valuable and who want the best for themselves. They will bargain amongst each other and create a world that is good to live in. Because my values are roughly aligned with their aggregate preferences, I expect them to create a rich and valuable world (by my lights as well as theirs).
  2. Some people in the future will have altruistic values broadly similar to my own, and will use their influence to create a rich and valuable world (by my lights as well as theirs).

Which of these pictures we take more seriously has implications for what we should do today. I often have object level disagreements which seem to boil down to disagreement about which of these pictures is more important, but rarely do I see serious discussion of that question. (When there is discussion, it seems to turn into a contest of political ideologies rather than facts.) Read the rest of this entry »

Self-driving cars as a target for philanthropy

The cost of driving

Driving causes a lot of damage; in the US alone, each year there are about 2 million accidents, around 30,000 people die, the CDC estimates $100 billion of costs from injuries and lost productivity, and it looks like well over 50 billion hours are spent driving. (Interesting aside: these quantities would all be equal at $2 / hour and $3 million / life, which I believe are relatively close to the average american’s actual reservation prices.)

Another way to estimate the size of losses from auto collisions is to look at the auto insurance industry, which has revenues of around $180B, of which more than 2/3 goes to claims. Claims and CDC estimates seem likely to be (highly correlated) overestimates for damages, but I think the ballpark figure of $100B in damages, 30,000 lives, and 50 billion hours is probably about right.  Read the rest of this entry »

Four flavors of time-discounting I endorse, and one I do not

(I apologize in advance for a bit of a long post. There is a more concise summary at the end.)

We often choose between doing good for the people of today and doing good for the people of the future, and are thus faced with a question: how do we trade off good now vs. good later? A standard answer to this question is to invoke exponential time discounting with one discount rate or another.

When I consult my intuition, I find that at least over the next few thousand years, I don’t much care about whether someone gets happier today or happier tomorrow—it’s all the same to me. (See also here for a much more thorough and correct discussion of this issue, and see here for a much more poetic description.)

Nevertheless, there are a few senses in which I do discount the future, and I think it’s important to bring those up to clarify what I do (and don’t mean) by saying that I have weak time preferences. Read the rest of this entry »

Improving decision-making

One way to influence the future is to improve human decision-making—to make people smarter, encourage metacognition, improve institutional decision-making, etc. Any of these changes will probably have an impact on how future folk manage the problems they face, and on the sorts of infrastructure and capabilities they in turn build for the farther future. Even if we don’t know what those problems will be, or what exactly we would want smarter or better-educated people to do, it seems like a safe bet that there will be opportunities for them to apply their increased capabilities.

But at the same time, I think most of the problems humans face are caused by humans. So if you make humans better at doing whatever they do, you speed up the creation of problems as well as their resolution.

Nevertheless, I tend to suspect that increasing human capabilities is a positive change on balance. I’m not sure about this, or about the magnitude of the impact; since it looks like capability improvements might be leading contenders for altruistic interventions, it seems like an important question. Depending on the answer, I may decide to work directly on the biggest problems I can see, or instead to help prepare future folk to do the same.  Read the rest of this entry »