James is right that Open Phil probably shouldn’t fund all those projects, because the reduction in total funding demands a higher funding bar
I think this assumes that the funding rate was appropriate given the presence of FTX. However, if one believes that EA will continue to recruit/produce billionaires, then EA could justify continuing the 2022 spend rate (or even more) despite the implosion of FTX (and reduction in Open Phil resources).
Agree with many of the considerations above—the bar should probably rise somewhat after such a funding shortfall. One way to solve it in practice could be to sit down in the room with the old FTX FF team and ask “which XX% of your grants are you most enthusiastic about and why”, and then (at least as an initial hypothesis; possibly requiring some further vetting) plan to fund that. The generalized point I’m trying to make is twofold: 1) that quite a bit of judgement already went into assessing these projects and it should be possible to use that to decide how many of them are above the bar, and 2) because all the other input factors (talent, project idea, vetting) are unchanged, and assuming a standard shape of the EA production function, the marginal returns to funding should now be unusually high.
And David is right that (at least under some reasonable models) if you can predict that your bar will fall in the future, you should probably lower it already. I’m not exactly sure what the requirements would be for the funding bar to have a Martingale property (e.g., does it require some version of risk neutrality, or specific assumptions about the shape of the impact distribution across projects or time), but it seems reasonable to start with something close to that assumption, at least. However that still implies that when you experience a large, unexpected funding shortfall, the bar does need to rise somewhat.
I agree with all three people:
Holden is right not to rush into funding FTX Foundation grantees
Jakob is right that there are now more shovel-ready projects for Open Phil to fund
James is right that Open Phil probably shouldn’t fund all those projects, because the reduction in total funding demands a higher funding bar
I think this assumes that the funding rate was appropriate given the presence of FTX. However, if one believes that EA will continue to recruit/produce billionaires, then EA could justify continuing the 2022 spend rate (or even more) despite the implosion of FTX (and reduction in Open Phil resources).
Agree with many of the considerations above—the bar should probably rise somewhat after such a funding shortfall. One way to solve it in practice could be to sit down in the room with the old FTX FF team and ask “which XX% of your grants are you most enthusiastic about and why”, and then (at least as an initial hypothesis; possibly requiring some further vetting) plan to fund that. The generalized point I’m trying to make is twofold: 1) that quite a bit of judgement already went into assessing these projects and it should be possible to use that to decide how many of them are above the bar, and 2) because all the other input factors (talent, project idea, vetting) are unchanged, and assuming a standard shape of the EA production function, the marginal returns to funding should now be unusually high.
And David is right that (at least under some reasonable models) if you can predict that your bar will fall in the future, you should probably lower it already. I’m not exactly sure what the requirements would be for the funding bar to have a Martingale property (e.g., does it require some version of risk neutrality, or specific assumptions about the shape of the impact distribution across projects or time), but it seems reasonable to start with something close to that assumption, at least. However that still implies that when you experience a large, unexpected funding shortfall, the bar does need to rise somewhat.