I think itâs relevant and useful that I noticed the âinfluence bonusâ that the standard donor gets comes from the bonus donor losing influence.
I didnât notice this at first! But I thought to myself âok, Jasonâs argument that the standard donor gets more than $1 of value sounds right, but I know thereâs only $2 value in the inputs. Where is the extra value coming from? If itâs being created, how is it being created?â
This kind of question really only makes sense if you stand by the â$2 in, $2 outâ kind of thinking, so I think this is a good example of why thatâs a good principle that led me to clarify my thinking and notice something new.
If all the effective charities have similar levels of effectiveness, then the bonus donor probably doesnât care about having influence within that subset?
No, the standard donor is meant to be a different audience, someone who isnât seeking to maximise effectivenessâthatâs why the post asks EAs not to be standard donors.
My use of non-âstandardâ terminology seems to have caused confusion; if I understand yours correctly, I think it is the bonus donor who usually gets more than $1 of value. The bonus donor surrenders control over which of six super-effective charities receives his $X. In exchange, the bonus donor gains influence over whether $2X from the standard donor goes to a standard charity or a super-effective one. Given EA beliefs about how starkly more cost-effective its preferred charities are over the median charity, the bonus donor likely views this control-for-influence trade as a net positive unless they have a strong preference among the six super-effective charities. Itâs the standard donor who is getting the short end of the stick in my estimation.
However, I think â$2 in, $2 outâ obscures that mutually beneficial trades of control/âinfluence can occur. The existence of mutually beneficial trades is, after all, fundamental to economics. When we are discussing trades in an economic marketplace, we assign value based on how each trade participant values what they gave up and what they got. If I buy a widget at $1 but would have been willing to pay up to $1.25 for it, we would say that the trade has generated 25 cents of consumer surplus. We wouldnât say that the widget must be assigned the same value on both ends of the transaction, and thus all trades are zero-sum and surplus cannot exist. Applying this model back to matching, it would seem consistent of us to calculate aggregate donor value based on the honestly held preferences of each donor and the true economic substance of the transaction.
So itâs possible for a trade to result in more utils under the preferences of both donors and those of the facilitator. Maybe the most extreme example would be a case in which I was planning to donate $1 to Politician Red, and you were planning to donate $1 to Politician Blue, but we both surrendered full control over our donation in exchange for influencing the other to donate the $1 to AMF instead. Or less dramatically, suppose I slightly favor effective animal-welfare charities over effective health ones, while my brother is relatively indifferent between effective and his favored non-effective health charities (but strongly prefers either to any animal-welfare charity). We can compromise on the effective health charity, rather than splitting 50â50 between our first choices.
On those trades, it seems really incongruous to say that there was $2 of impact before, and yet only $2 after. In the me/âbrother example, you could say that there was only $1.10 of impact pre-trade ($1 for me, 10 cents for my brother) and $1.90 post-trade (95 cents for each dollar spent, since we stipulated that the animal-welfare charity was slightly more impactful). I would roughly allocate that impact as $1.40 for me /â 50 cents for my brother. Why? It seems illogical to assign less impact for the donorâs own dollar than they would have attained prior to a mutually beneficial trade, and âsplit the surplusâ seems like a reasonable default rule. But the end result is that the trade (which is equivalent in effect to a âmatchâ) has indeed increased the impact attributable to both my brother and to me! So, the claim that one can often increase impact by trading control/âinfluence with a donor who would otherwise make suboptimal choices would evaluate as true. And I think thatâs the core claim that donation-matching orgs are often making, at least to EAs?
oh, I also want to add that:
I think itâs relevant and useful that I noticed the âinfluence bonusâ that the standard donor gets comes from the bonus donor losing influence.
I didnât notice this at first! But I thought to myself âok, Jasonâs argument that the standard donor gets more than $1 of value sounds right, but I know thereâs only $2 value in the inputs. Where is the extra value coming from? If itâs being created, how is it being created?â
This kind of question really only makes sense if you stand by the â$2 in, $2 outâ kind of thinking, so I think this is a good example of why thatâs a good principle that led me to clarify my thinking and notice something new.
If all the effective charities have similar levels of effectiveness, then the bonus donor probably doesnât care about having influence within that subset?
Yes, but then the standard donor doesnât care about having the influence either, right?
No, the standard donor is meant to be a different audience, someone who isnât seeking to maximise effectivenessâthatâs why the post asks EAs not to be standard donors.
My use of non-âstandardâ terminology seems to have caused confusion; if I understand yours correctly, I think it is the bonus donor who usually gets more than $1 of value. The bonus donor surrenders control over which of six super-effective charities receives his $X. In exchange, the bonus donor gains influence over whether $2X from the standard donor goes to a standard charity or a super-effective one. Given EA beliefs about how starkly more cost-effective its preferred charities are over the median charity, the bonus donor likely views this control-for-influence trade as a net positive unless they have a strong preference among the six super-effective charities. Itâs the standard donor who is getting the short end of the stick in my estimation.
However, I think â$2 in, $2 outâ obscures that mutually beneficial trades of control/âinfluence can occur. The existence of mutually beneficial trades is, after all, fundamental to economics. When we are discussing trades in an economic marketplace, we assign value based on how each trade participant values what they gave up and what they got. If I buy a widget at $1 but would have been willing to pay up to $1.25 for it, we would say that the trade has generated 25 cents of consumer surplus. We wouldnât say that the widget must be assigned the same value on both ends of the transaction, and thus all trades are zero-sum and surplus cannot exist. Applying this model back to matching, it would seem consistent of us to calculate aggregate donor value based on the honestly held preferences of each donor and the true economic substance of the transaction.
So itâs possible for a trade to result in more utils under the preferences of both donors and those of the facilitator. Maybe the most extreme example would be a case in which I was planning to donate $1 to Politician Red, and you were planning to donate $1 to Politician Blue, but we both surrendered full control over our donation in exchange for influencing the other to donate the $1 to AMF instead. Or less dramatically, suppose I slightly favor effective animal-welfare charities over effective health ones, while my brother is relatively indifferent between effective and his favored non-effective health charities (but strongly prefers either to any animal-welfare charity). We can compromise on the effective health charity, rather than splitting 50â50 between our first choices.
On those trades, it seems really incongruous to say that there was $2 of impact before, and yet only $2 after. In the me/âbrother example, you could say that there was only $1.10 of impact pre-trade ($1 for me, 10 cents for my brother) and $1.90 post-trade (95 cents for each dollar spent, since we stipulated that the animal-welfare charity was slightly more impactful). I would roughly allocate that impact as $1.40 for me /â 50 cents for my brother. Why? It seems illogical to assign less impact for the donorâs own dollar than they would have attained prior to a mutually beneficial trade, and âsplit the surplusâ seems like a reasonable default rule. But the end result is that the trade (which is equivalent in effect to a âmatchâ) has indeed increased the impact attributable to both my brother and to me! So, the claim that one can often increase impact by trading control/âinfluence with a donor who would otherwise make suboptimal choices would evaluate as true. And I think thatâs the core claim that donation-matching orgs are often making, at least to EAs?