Yeah, I totally agree that if you’re much more sophisticated than your (potential) donors you want to do this kind of analysis. I don’t think that applies in the case of what I was gesturing at with “~community projects”, which is where I was making the case for implicit impact markets.
Assuming that the buyers in the market are sophisticated:
in the straws case, they might say “we’ll pay $6 for this output” and the straw org might think “$6 is nowhere close to covering our operating costs of $82,000” and close down
I think too much work is being done by your assumption that the cost effectiveness can’t be increased. In an ideal world, the market could create competition which drives both orgs to look for efficiency improvements
I’m guessing 2 is in response to the example I removed from my comment, roughly starting a new equally cost-effective org working on the same thing as another org would be pointless and create waste. I agree that there could be efficiency improvements, but now we’re asking how much and if that justifies the co-founders’ opportunity costs and other costs. The impact of the charity now comes from a possibly only marginal increase in cost-effectiveness. That’s a completely different and much harder analysis. I’m also more skeptical of the gains in cases where EA charities are already involved, since they are already aiming to maximize cost-effectiveness.
Yeah, I totally agree that if you’re much more sophisticated than your (potential) donors you want to do this kind of analysis. I don’t think that applies in the case of what I was gesturing at with “~community projects”, which is where I was making the case for implicit impact markets.
Assuming that the buyers in the market are sophisticated:
in the straws case, they might say “we’ll pay $6 for this output” and the straw org might think “$6 is nowhere close to covering our operating costs of $82,000” and close down
I think too much work is being done by your assumption that the cost effectiveness can’t be increased. In an ideal world, the market could create competition which drives both orgs to look for efficiency improvements
I’m guessing 2 is in response to the example I removed from my comment, roughly starting a new equally cost-effective org working on the same thing as another org would be pointless and create waste. I agree that there could be efficiency improvements, but now we’re asking how much and if that justifies the co-founders’ opportunity costs and other costs. The impact of the charity now comes from a possibly only marginal increase in cost-effectiveness. That’s a completely different and much harder analysis. I’m also more skeptical of the gains in cases where EA charities are already involved, since they are already aiming to maximize cost-effectiveness.