[Question] How should large donors coordinate with small donors?

I’m sur­prised at how lit­tle dis­cus­sion there has been on the ques­tion of how large donors such as Good Ven­tures should co­or­di­nate with small in­di­vi­d­ual donors, given the seem­ingly ob­vi­ous high value of in­for­ma­tion in such an in­ves­ti­ga­tion. For ex­am­ple, Good Ven­tures cur­rently has a “split­ting” policy where they only fund 50% of a char­ity’s room for fund­ing in or­der to leave op­por­tu­ni­ties for small donors to do their part. But it seems fairly likely that ei­ther “split­ting” is wrong, or 50% is not the op­ti­mal ra­tio. In one of the few places where this has ap­par­ently been dis­cussed, Holden Karnofsky wrote (in re­ply to Ben Hoff­man):

if you take into ac­count the differ­ence in scale be­tween Good Ven­tures and other GiveWell donors, Good Ven­tures’s ‘fair share’ seems more likely to be in ex­cess of 80%, than a 50-50 split.

We ex­pected in­di­vi­d­ual giv­ing to grow over time, and thought that it would grow less if we had a policy of fully fund­ing top char­i­ties. Calcu­lat­ing “fair share” based on cur­rent giv­ing alone, as op­posed to giv­ing ca­pac­ity con­strued more broadly and over a longer-term, would have cre­ated the kinds of prob­le­matic in­cen­tives we wrote that we were wor­ried about. 50% is within range of what I’d guess would be a long-term fair share.

It seems likely that in­di­vi­d­ual giv­ing will grow over time, but shouldn’t we ex­pect more large donors to join EA as well in the fu­ture? Are we sure 50% is more fair in the long run than 80%?

It does seem likely that in­di­vi­d­ual giv­ing would grow less if big donors fully funded top char­i­ties, but it also seems likely that in­di­vi­d­u­als do­ing di­rect work in EA would grow more if big donors fully funded top char­i­ties. It seems far from ob­vi­ous which effect is more im­por­tant.

An ad­van­tage of big donors fund­ing their top char­i­ties fully or at a higher ra­tio is that small donors would have more in­cen­tives to do more in­de­pen­dent think­ing and es­sen­tially act as “scouts” for the big donors to help look for more or bet­ter op­por­tu­ni­ties for effec­tive giv­ing, or to ac­tively cre­ate new op­por­tu­ni­ties. Those who aren’t in­clined to do that and would rather fol­low the big donors could still con­tribute to the 20% share or donate to a fund con­trol­led by the same pro­gram officers as the large donors. (ETA: In other words, the cur­rent policy makes it much harder than it per­haps should to start up and get fund­ing for a new effec­tive char­ity, be­cause the top char­i­ties that OpenPhil /​ Good Ven­tures have iden­ti­fied but not fully funded are un­nec­es­sar­ily suck­ing up most of the dona­tions from in­di­vi­d­ual donors who might oth­er­wise fund these riskier new op­por­tu­ni­ties.)

A down­side of this (which has been pre­vi­ously men­tioned) is that it might cre­ate too much of a de­pen­dency for the char­ity on the big donor. I think this can be miti­gated if the big donor com­mits to giv­ing early warn­ing to any char­ity that it wants to de­fund, and/​or to an ex­tended draw­down sched­ule that leaves enough time for the char­ity to find other sources of fund­ing. If the big donor is fund­ing top char­i­ties at 80 or 100%, there could be a lot of small EA donors try­ing to find giv­ing op­por­tu­ni­ties, who would jump in if that char­ity is re­ally still cost-effec­tive.

In sum­mary, I’m not try­ing to ar­gue con­clu­sively for a par­tic­u­lar al­ter­na­tive to Good Ven­ture’s cur­rent policy, but just point­ing out that given what’s at stake, there seems to be more than enough un­cer­tainty here to merit a much more thor­ough in­ves­ti­ga­tion. (ETA: To be clear I don’t think that per­son should be me be­cause my com­par­a­tive ad­van­tage prob­a­bly lies el­se­where.)

No answers.