Very helpful response! This (like much of the other detailed transparency you’ve provided) really helped me understand how you think about your grantmaking (strong upvote), though I wasn’t actually thinking about “risk of abuse” in my question.
I’d been thinking of “risk” in the sense that the EA Funds materials on the topic use the term: “The risk that a grant will have little or no impact.” I think this is basically the kind of risk that most donors will be most concerned about, and is generally a pretty intuitive framing. And while I’m open to counterarguments, my impression is that the LTFF’s grants are riskier in this sense than grants made by the other funds because they have longer and less direct paths to impact.
I think “risk of abuse” is an important thing to consider, but not something worth highlighting to donors through a prominent section of the fund pages. I’d guess that most donors assume that EA Funds is run in a way that “risk of abuse” is quite low, and that prospective donors would be turned off by lots of content suggesting otherwise. Also, I’m not sure “risk of abuse” is the right term. I’ve argued that some parts of EA grantmaking are too dependent on relationships and networks, but I’m much more concerned about unintentional biases than the kind of overt (and unwarranted) favoritism that “risk of abuse” implies. Maybe “risk of bias”?
I’d been thinking of “risk” in the sense that the EA Funds materials on the topic use the term: “The risk that a grant will have little or no impact.” I think this is basically the kind of risk that most donors will be most concerned about, and is generally a pretty intuitive framing.
To be clear, I am claiming that the section you are linking is not very predictive of how I expect CEA to classify our grants, and is not very predictive of the attitudes that I have seen from CEA and other stakeholders and donors of the funds, in terms of whether they will have an intuitive sense that a grant is “risky”. Indeed, I think that page is kind of misleading and think we should probably rewrite it.
I am concretely claiming that both CEA’s attitudes, the attitudes of various stakeholders, and most donors attitudes is better predicted by the “risk of abuse” framing I have outlined. In that sense, I disagree with you that most donors will be primarily concerned about the kind of risk that is discussed on the EA Funds page.
Obviously, I do still think there is a place for considering something more like “variance of impact”, but I don’t actually think that that dimension has played a large role in people’s historical reactions to grants we have made, and I don’t expect it to matter too much in the future. I think in terms of impact, most people I have interacted with tend to be relatively risk-neutral when it comes to their altruistic impact (and I don’t know of any good arguments for why someone should be risk-averse in their altruistic activities, since the case for diminishing marginal returns at the scales on which our grants tend to influence things seems pretty weak).
Edit: To give a more concrete example here, I think by far the grant that has been classified as the “riskiest” grant we have made, that from what I can tell has been motivating a lot of the split into “high risk” and “medium risk” grants, is our grant to Lauren Lee. That grant does not strike me as having a large downside risk, and I don’t think anyone I’ve talked to has suggested that this is the case. The risk that people have talked about is the risk of abuse that I have been talking about, and associated public relations risks, and many have critiqued the grant as “the Long Term Future Fund giving money to their friends”, which highlights to me the dimension of abuse risk much more concretely than the dimension of high variance.
In addition to that, grants that operate a higher level of meta than other grants, i.e. which tend to facilitate recruitment, training or various forms of culture-development, have not been broadly described as “risky” to me, even though from a variance perspective those kinds of grants are almost always much higher variance than the object-level activities that they tend to support (since their success and failure is dependent on the success of the object-level activities). Which again strikes me as strong evidence that variance of impact (which seems to be the perspective that the EA Funds materials appear to take) is not a good predictor of how people classify the grants.
Obviously, I do still think there is a place for considering something more like “variance of impact”, but I don’t actually think that that dimension has played a large role in people’s historical reactions to grants we have made, and I don’t expect it to matter too much in the future.
Relatedly, I don’t recall anyone pointing out that funding a large number of ‘risky’ individuals, instead of a small number of ‘safe’ organisations, might be less risky (in the sense of lower variance), because the individual risks are largely independent, so you get a lot of portfolio diversification.
To be clear, I am claiming that the section you are linking is not very predictive of how I expect CEA to classify our grants, and is not very predictive of the attitudes that I have seen from CEA and other stakeholders and donors of the funds, in terms of whether they will have an intuitive sense that a grant is “risky”. Indeed, I think that page is kind of misleading and think we should probably rewrite it.
I am concretely claiming that both CEA’s attitudes, the attitudes of various stakeholders, and most donors attitudes is better predicted by the “risk of abuse” framing I have outlined. In that sense, I disagree with you that most donors will be primarily concerned about the kind of risk that is discussed on the EA Funds page.
If risk of abuse really is the big concern for most stakeholders, then I agree rewriting the risk page would make a lot of sense. Since that’s a fairly new page, I’d assumed it incorporated current thinking/feedback.
*nods* This perspective is currently still very new to me, and I’ve only briefly talked about it to people at CEA and other fund members. My sense was that people found the “risk of abuse” framing to resonate a good amount, but this perspective is definitely in no way consensus of the current fund-stakeholders, and is only the best way I can currently make sense of the constraints the fund is facing. I don’t know yet to what degree others will find this perspective compelling.
I don’t think anyone made a mistake by writing the current risk-page, which I think was an honest and good attempt at trying to explain a bunch of observations and perspectives. I just think I now have a better model that I would prefer to use instead.
Very helpful response! This (like much of the other detailed transparency you’ve provided) really helped me understand how you think about your grantmaking (strong upvote), though I wasn’t actually thinking about “risk of abuse” in my question.
I’d been thinking of “risk” in the sense that the EA Funds materials on the topic use the term: “The risk that a grant will have little or no impact.” I think this is basically the kind of risk that most donors will be most concerned about, and is generally a pretty intuitive framing. And while I’m open to counterarguments, my impression is that the LTFF’s grants are riskier in this sense than grants made by the other funds because they have longer and less direct paths to impact.
I think “risk of abuse” is an important thing to consider, but not something worth highlighting to donors through a prominent section of the fund pages. I’d guess that most donors assume that EA Funds is run in a way that “risk of abuse” is quite low, and that prospective donors would be turned off by lots of content suggesting otherwise. Also, I’m not sure “risk of abuse” is the right term. I’ve argued that some parts of EA grantmaking are too dependent on relationships and networks, but I’m much more concerned about unintentional biases than the kind of overt (and unwarranted) favoritism that “risk of abuse” implies. Maybe “risk of bias”?
To be clear, I am claiming that the section you are linking is not very predictive of how I expect CEA to classify our grants, and is not very predictive of the attitudes that I have seen from CEA and other stakeholders and donors of the funds, in terms of whether they will have an intuitive sense that a grant is “risky”. Indeed, I think that page is kind of misleading and think we should probably rewrite it.
I am concretely claiming that both CEA’s attitudes, the attitudes of various stakeholders, and most donors attitudes is better predicted by the “risk of abuse” framing I have outlined. In that sense, I disagree with you that most donors will be primarily concerned about the kind of risk that is discussed on the EA Funds page.
Obviously, I do still think there is a place for considering something more like “variance of impact”, but I don’t actually think that that dimension has played a large role in people’s historical reactions to grants we have made, and I don’t expect it to matter too much in the future. I think in terms of impact, most people I have interacted with tend to be relatively risk-neutral when it comes to their altruistic impact (and I don’t know of any good arguments for why someone should be risk-averse in their altruistic activities, since the case for diminishing marginal returns at the scales on which our grants tend to influence things seems pretty weak).
Edit: To give a more concrete example here, I think by far the grant that has been classified as the “riskiest” grant we have made, that from what I can tell has been motivating a lot of the split into “high risk” and “medium risk” grants, is our grant to Lauren Lee. That grant does not strike me as having a large downside risk, and I don’t think anyone I’ve talked to has suggested that this is the case. The risk that people have talked about is the risk of abuse that I have been talking about, and associated public relations risks, and many have critiqued the grant as “the Long Term Future Fund giving money to their friends”, which highlights to me the dimension of abuse risk much more concretely than the dimension of high variance.
In addition to that, grants that operate a higher level of meta than other grants, i.e. which tend to facilitate recruitment, training or various forms of culture-development, have not been broadly described as “risky” to me, even though from a variance perspective those kinds of grants are almost always much higher variance than the object-level activities that they tend to support (since their success and failure is dependent on the success of the object-level activities). Which again strikes me as strong evidence that variance of impact (which seems to be the perspective that the EA Funds materials appear to take) is not a good predictor of how people classify the grants.
Relatedly, I don’t recall anyone pointing out that funding a large number of ‘risky’ individuals, instead of a small number of ‘safe’ organisations, might be less risky (in the sense of lower variance), because the individual risks are largely independent, so you get a lot of portfolio diversification.
If risk of abuse really is the big concern for most stakeholders, then I agree rewriting the risk page would make a lot of sense. Since that’s a fairly new page, I’d assumed it incorporated current thinking/feedback.
*nods* This perspective is currently still very new to me, and I’ve only briefly talked about it to people at CEA and other fund members. My sense was that people found the “risk of abuse” framing to resonate a good amount, but this perspective is definitely in no way consensus of the current fund-stakeholders, and is only the best way I can currently make sense of the constraints the fund is facing. I don’t know yet to what degree others will find this perspective compelling.
I don’t think anyone made a mistake by writing the current risk-page, which I think was an honest and good attempt at trying to explain a bunch of observations and perspectives. I just think I now have a better model that I would prefer to use instead.