Final Round of the Impact Purchase

[Paul_Christiano]

The impact purchase has so far distributed $5k, out of $10k planned for 2015.

(If you don’t know what the impact purchase is: the original announcement is here; my post on “certificates of impact” is here; Ben Kuhn posted a better explanation here; past results are here.)

We’re going to spend the final $5k in December. The last round is going to be significantly simplified, both for applicants and for us. Here’s how it will work:

1. Sellers may submit a one-sentence description of what they did, an optional link, and a price at which they would be willing to “sell” some portion of the impact. This process should take only a few minutes.

2. We may ask further questions or further investigate the particular projects that we are most likely to purchase.

3. We, or other buyers, will accept some of the offers made in step [1]. If a price is attractive but not quite good enough then we may make a counteroffer, and haggling may ensue. The offers in step [1] aren’t formally binding, so the seller can still back out (though we’d appreciate if you don’t, since doing so wastes time).

If you want to submit an offer, you can either make a comment on this post, or fill out the form here. If you’ve submitted a project to a previous round there is no need to resubmit (though we are likely to email you to elicit your new asking price, given that the structure of the auction has changed).

The key change is that we are no longer trying to incentivize honesty. We realized that trying to be incentive-compatible made the process much more expensive, for both us and the sellers. We also realized that the incentives were never going to be perfect or even great, once we had a dynamic process with more than one buyer.

My guess is that blog posts (or other relatively self-contained writings) are the most promising candidates; I recommend a low bar for quickly submitting a link and a high-ball estimate for the value of a post, as long as you won’t be offended when we don’t fund it.

As always, our evaluations will be unapologetically arbitrary, rough, and biased.

The deadline for submissions is Sunday December 20.

[vipulnaik]

The idea that a fund outlay needs to be spent in haste since its completion date is approaching reminds me of the perverse incentives created in academic grants. What are your thoughts on simply rolling over the unspent money to increase the money you’ll grant in 2016, rather than spending it in a hurry?

[Paul_Christiano]

Several of the most promising applicants from previous rounds were willing to roll their applications to the new format. It’s not clear that haste makes significant (any?) waste. We also weren’t getting many new applicants per month without any new activity on our part, and we are generally interested in conserving time.

Since we never announced how much we would spend in 2016, it’s hard to demonstrate that extra money is really extra.

[Chris Leong]

Why are you paying full price, instead of trying to buy them at a discount? Or has that changed? Like let’s suppose that each project you fund becomes 10% more likely because of the certificate scheme. In this situation, you should be trying to buy a certificate for the entire project at 10% of the altruistic value.

[Paul_Christiano]

I disagree with your use of “should.”

[Larks]

We also realized that the incentives were never going to be perfect or even great, once we had a dynamic process with more than one buyer.

Surely having multiple buyers improves incentive compatibility? In the limit consider the stock market, with a arbitrarily large number of buyers and very well aligned incentives.

[Paul_Christiano]

Competition amongst buyers improves incentives in general, but the added complexity quickly destroys the specific guarantee of incentive-compatibility enjoyed by a second price auction.

For example, when the sale price in one round is published, it means that making a cheap sale can easily be worse than making no sale at all, since it affects what you might be able to earn in future rounds.

That’s a particularly hard example to avoid. There are a bunch of other issues that seem easier to avoid, but only by placing increasingly strict constraints on the behavior of every buyer (e.g. once you make an offer on an item, you can never make any lower offer on the same item).

[Peter Wildeford]

What’s the deadline for submitting?

[Paul_Christiano]

December 20, sorry for leaving that out of the original post.

[Ervin]

It’s excellent to see you complete this! Good luck. Do you plan to write-up an evaluation of the project, and your thoughts on the best ways to ensure good EA work gets funded?