Your maths needs a term for the conversion between money and labour for the company. I think your current equation assumes 1 to 1 which seems patently false
Thanks, Neel. I am assuming the marginal cost-effectiveness of spending on capital and labour is the same. Organisations should move money from the least to the most cost-effective activities until the marginal cost-effectiveness of all activities is equalised. I understand organisations do not manage their resources perfectly. However, for one to argue against my assumption, one would need specific arguments about why, for example, AI safety organisations are under or overspending on compute, or are under or overpaying their employees.
Your maths needs a term for the conversion between money and labour for the company. I think your current equation assumes 1 to 1 which seems patently false
Thanks, Neel. I am assuming the marginal cost-effectiveness of spending on capital and labour is the same. Organisations should move money from the least to the most cost-effective activities until the marginal cost-effectiveness of all activities is equalised. I understand organisations do not manage their resources perfectly. However, for one to argue against my assumption, one would need specific arguments about why, for example, AI safety organisations are under or overspending on compute, or are under or overpaying their employees.