My naïve intuition is that it would be good for many EA orgs to decentralise further and/or move bases out of expensive areas, due to lower operating costs and I think better optics leading to greater cost-effectiveness. But after considering that many smarter and more knowledgeable people think otherwise, I would be slightly surprised if this intuition was correct (having tried to comprehend everything in a GiveWell model, I can see the benefit in people regularly being in the same room).
Would you agree that location vs value-based is a false dichotomy and they represent two extreme ends of a spectrum? In reality, I understand the majority of companies benchmark using local competitive rates, but this does not have to be the case. My intuition leans towards a norm of using both location and value-based components in deciding salary. This would mean a worker based in San Francisco would be paid more than one in Nairobi, but less relative to local cost of living.
On #5, I think these salaries need to consider averages, not exceptions. Also, I believe it is greater job opportunities that lead to organisations needing to set higher wages.
The example of the Kenyan employee effectively redistributing their disposable income seems a bit idealistic to me. Offering high wages for the region would attract a greater proportion of less-altruistically minded people who would not necessarily redistribute generously and impartially. In addition, GiveDirectly (and other NGOs) have developed their own ideas on how these funds could effectively be used. Even with the individual’s advantage of being in the region, the NGO must view this as an expected cost to their broadly-defined goal of global development. There are likely overall benefits to the NGO in terms of image and employee morale, but (I think) not in the explicit benefits from philanthropic investments made by the individual.
To repeat myself a little. Thanks for the post and perspective. My admittedly uniformed hunch is that it would be great to see more EA-aligned orgs hiring remote workers in less developed and expensive regions. I think ideal remuneration for the positions would involve location and value-based components.
I truly appreciate your perspective on the decentralization and relocation of EA organizations. It’s an interesting idea that many of us might instinctively consider beneficial due to lower operating costs and potential improvements in optics and cost-effectiveness. I think it is important to acknowledge the diverse viewpoints of experts in the field, who may have a more nuanced understanding of the situation. Having looked into the GiveWell model myself, I can comprehend the value of having people regularly gather in the same physical space for collaboration and synergy, which might not be easily replicable in a decentralized setup.
Regarding the interplay between location and value-based considerations in salary determinations, I agree with your notion that it is not a matter of choosing one over the other. Rather, it’s about finding a balance and establishing a norm where both factors are taken into account. While it is common for companies to benchmark salaries based on local competitive rates, your intuition of incorporating location-specific and value-based components resonates with me. This approach would ensure that a worker in a city like San Francisco, for example, receives a higher salary than someone in Nairobi, while still accounting for the local cost of living.
Your emphasis on considering averages rather than exceptions when contemplating salaries is noteworthy. It is essential to look at the bigger picture and consider the overall job market and opportunities available. Organizations often find themselves needing to offer higher wages due to competitive factors, as they strive to attract and retain top talent in the field.
Regarding the example of a Kenyan employee redistributing their disposable income, I understand your skepticism. While offering higher wages in the region might attract individuals who are not as altruistically inclined and may not generously or impartially redistribute their income, it is crucial to examine the broader impact. NGOs like GiveDirectly have developed their own strategies for effectively utilizing funds and addressing philanthropic goals. Even if the individual’s philanthropic investments may not directly align with the NGO’s objectives, there can be overall benefits in terms of organizational image and employee morale. It is indeed a complex balance that requires careful consideration and evaluation.
By incorporating both location-specific and value-based components in remuneration decisions, we can strive to strike a harmonious balance. I find it crucial to approach this endeavor with empathy and an understanding of the potential implications, ensuring that the overall impact aligns with the organization’s goals and respects the humanity of all involved. Once again, thank you for sharing your valuable perspective.
Nice one George. Some thoughts:
My naïve intuition is that it would be good for many EA orgs to decentralise further and/or move bases out of expensive areas, due to lower operating costs and I think better optics leading to greater cost-effectiveness. But after considering that many smarter and more knowledgeable people think otherwise, I would be slightly surprised if this intuition was correct (having tried to comprehend everything in a GiveWell model, I can see the benefit in people regularly being in the same room).
Would you agree that location vs value-based is a false dichotomy and they represent two extreme ends of a spectrum? In reality, I understand the majority of companies benchmark using local competitive rates, but this does not have to be the case. My intuition leans towards a norm of using both location and value-based components in deciding salary. This would mean a worker based in San Francisco would be paid more than one in Nairobi, but less relative to local cost of living.
On #5, I think these salaries need to consider averages, not exceptions. Also, I believe it is greater job opportunities that lead to organisations needing to set higher wages.
The example of the Kenyan employee effectively redistributing their disposable income seems a bit idealistic to me. Offering high wages for the region would attract a greater proportion of less-altruistically minded people who would not necessarily redistribute generously and impartially. In addition, GiveDirectly (and other NGOs) have developed their own ideas on how these funds could effectively be used. Even with the individual’s advantage of being in the region, the NGO must view this as an expected cost to their broadly-defined goal of global development. There are likely overall benefits to the NGO in terms of image and employee morale, but (I think) not in the explicit benefits from philanthropic investments made by the individual.
To repeat myself a little. Thanks for the post and perspective. My admittedly uniformed hunch is that it would be great to see more EA-aligned orgs hiring remote workers in less developed and expensive regions. I think ideal remuneration for the positions would involve location and value-based components.
Thanks Scott for your comment and thoughts!
I truly appreciate your perspective on the decentralization and relocation of EA organizations. It’s an interesting idea that many of us might instinctively consider beneficial due to lower operating costs and potential improvements in optics and cost-effectiveness. I think it is important to acknowledge the diverse viewpoints of experts in the field, who may have a more nuanced understanding of the situation. Having looked into the GiveWell model myself, I can comprehend the value of having people regularly gather in the same physical space for collaboration and synergy, which might not be easily replicable in a decentralized setup.
Regarding the interplay between location and value-based considerations in salary determinations, I agree with your notion that it is not a matter of choosing one over the other. Rather, it’s about finding a balance and establishing a norm where both factors are taken into account. While it is common for companies to benchmark salaries based on local competitive rates, your intuition of incorporating location-specific and value-based components resonates with me. This approach would ensure that a worker in a city like San Francisco, for example, receives a higher salary than someone in Nairobi, while still accounting for the local cost of living.
Your emphasis on considering averages rather than exceptions when contemplating salaries is noteworthy. It is essential to look at the bigger picture and consider the overall job market and opportunities available. Organizations often find themselves needing to offer higher wages due to competitive factors, as they strive to attract and retain top talent in the field.
Regarding the example of a Kenyan employee redistributing their disposable income, I understand your skepticism. While offering higher wages in the region might attract individuals who are not as altruistically inclined and may not generously or impartially redistribute their income, it is crucial to examine the broader impact. NGOs like GiveDirectly have developed their own strategies for effectively utilizing funds and addressing philanthropic goals. Even if the individual’s philanthropic investments may not directly align with the NGO’s objectives, there can be overall benefits in terms of organizational image and employee morale. It is indeed a complex balance that requires careful consideration and evaluation.
By incorporating both location-specific and value-based components in remuneration decisions, we can strive to strike a harmonious balance. I find it crucial to approach this endeavor with empathy and an understanding of the potential implications, ensuring that the overall impact aligns with the organization’s goals and respects the humanity of all involved. Once again, thank you for sharing your valuable perspective.