Do GiveWell’s published cost-effectiveness estimates already include an adjustment for the optimizer’s curse? Or is the idea that donors should treat estimates like 35x cash as “raw” expected value calculations, to which they apply their own informal Bayesian adjustment along the lines of Holden’s post?
Yes, the cost-effectiveness estimates we discuss publicly, including the 35x cash (preliminary!) estimate for the maternal syphilis expansion grant, incorporate all “human adjustments” we make to raw expected value, which often appear as “supplemental adjustments” in our cost-effectiveness analyses. These include factors such as likelihood of leverage and funging; charity-level risks, like wastage or funds being diverted for some other purpose; or intervention-level adjustments, like reduction in nonfatal illness or spillover effects. We don’t explicitly model these factors, but incorporate rough best guesses of their effects, which can shift the final cost-effectiveness estimate.
Thanks very much for the update!
Do GiveWell’s published cost-effectiveness estimates already include an adjustment for the optimizer’s curse? Or is the idea that donors should treat estimates like 35x cash as “raw” expected value calculations, to which they apply their own informal Bayesian adjustment along the lines of Holden’s post?
Hi, Andrew,
Yes, the cost-effectiveness estimates we discuss publicly, including the 35x cash (preliminary!) estimate for the maternal syphilis expansion grant, incorporate all “human adjustments” we make to raw expected value, which often appear as “supplemental adjustments” in our cost-effectiveness analyses. These include factors such as likelihood of leverage and funging; charity-level risks, like wastage or funds being diverted for some other purpose; or intervention-level adjustments, like reduction in nonfatal illness or spillover effects. We don’t explicitly model these factors, but incorporate rough best guesses of their effects, which can shift the final cost-effectiveness estimate.
Best,
Miranda