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Giving Now vs Giving Later

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  • Nick Beckstead
    Hi Everyone, I ve been on this list for about a year and a half, but I haven t made any posts. So let me introduce myself: I m a Ph.D. student in the
    Message 1 of 3 , Jan 13, 2010
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      Hi Everyone,

      I've been on this list for about a year and a half, but I haven't made
      any posts. So let me introduce myself: I'm a Ph.D. student in the
      philosophy department at Rutgers University. My academic area of
      specialization is ethics. I care a lot about effective giving. I'm
      very excited about GiveWell's research.

      I'd like to get some input from some of you on the question of whether
      it would be best to give now, invest and give in the medium term, or
      invest and give much later. GiveWell hasn't been researching this
      kind of thing, but this question is important to me and I find it very
      difficult to answer. I suspect that some of you may care about this
      question as well, and that some of you have thought about it more
      carefully than I have. I think the best way to inform me about this
      will be for me to tell you what my hunches are and have people tell me
      what's wrong with them. So let me say a bit about how I'm approaching
      this issue and then describe my hunches.

      Suppose your goal is to maximize the expected benefit of your lifetime
      donations. These questions seem to be very relevant to determining
      the timing of an optimal giving strategy: (1) Will you be weak-willed
      and not do it later if you wait? (2) How large are the expected
      returns on social investment? (3) How large would the expected real
      gain be if you invested the money? (4) Will we be able to provide help
      more efficiently in the future? By how much? (5) Will giving now or
      giving later better encourage others to help more/more effectively? By
      how much? (6) Should you use some kind of future discounting rate?
      What rate?

      I doubt anyone has anything useful to say about (1). (6) is a
      question about which a fair amount of ink has already been spilled.
      I'm most interested in information on (4) and on how (2) and (3)
      compare.

      Here are my hunches, I'd like to know what some of you think of them.
      First hunch: for the foreseeable future, expected benefits accruing
      from financial return on investment leading to greater donations will
      significantly exceed expected benefits accruing from social return on
      investment. Reasoning: likely benefits related to social return on
      investment will not be directed to priority interventions; the rate of
      social return on investment would have to be implausibly high in order
      to be equally as great as expected benefits accruing from real
      interest being added to future donations to the best organizations.

      Second hunch: in the long run, priority programs will not be as
      effective as the are now, but the expected benefits of giving to the
      best organizations we'll know of in 2-5 years will be greater than the
      expected benefits of giving to the best organizations we know of now.
      Reasoning: the more developed a country is, the worse the best
      interventions are. In the long run, poorer areas will be more
      developed, so the best interventions in those countries will not be
      very good. For the 2-5 year range, we've gotten a lot of good
      information about effective giving over the last few years, in large
      part thanks to GiveWell (at least as far as the information I know of
      goes). This kind of analysis is new, and it wouldn't too surprising
      if we found an organization that was, say, 20% more effective than the
      best one identified so far over the next 2-5 years. This could be in
      the form of finding a more effective cause, or finding a more
      effective organization focusing on health aid for the international
      poor. (A conversation with Elie makes me worry that I've
      overestimated the probability of this happening). It's less likely
      that giving opportunities will become substantially worse during that
      time period.

      Third hunch: compared to the factors discussed above, the positive
      effects from my particular donations re: (5) will be small.
      Reasoning: this is such a complete hunch that I have nothing at all to
      back it up.

      If these hunches are right, it would suggest that it makes sense to
      wait 2-5 years to start giving big. Does it make sense to wait
      longer? I have no idea. Predictions about this seem a lot like
      predictions about how the copper market will be doing in 10 years.

      Those are the questions I'm asking and those are my hunches. So I
      want to be corrected by someone who knows more about this. Here are
      some ways my hunches could go wrong that I'm especially worried about.
      First, it could be that (i) VillageReach/Stop TB is still the best
      organization in 2-5 years and (ii) the funding situation for
      VillageReach/Stop TB makes it optimal to give now rather than 2-5
      years from now. Second, it could be that health interventions in
      developing countries are the best cause, and GiveWell has so
      thoroughly investigated this cause that we are unlikely to discover a
      significantly more effective organization in the next 2-5 years.
      Third, it could be that I've significantly underestimated the
      importance of giving now for making others give more and give more
      effectively. Fourth, it could be that I've significantly
      underestimated the rate of social return for giving to priority
      organizations.

      So what do you think about comparing (4) and comparing (2) and (3)?
      What do you think about my hunches? How worried should I be about the
      ways in which my hunches might be wrong? Any other thoughts on giving
      now vs giving kinda later vs. giving a lot later? I'd be especially
      interested if you can refer me to relevant literature on these issues.

      Best,

      Nick
    • Holden Karnofsky
      Nick, I appreciate this very thoughtful email. I am guessing that the silence has a lot to do with the fact that there doesn t seem to be much public
      Message 2 of 3 , Jan 22, 2010
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        Nick, I appreciate this very thoughtful email.  I am guessing that the silence has a lot to do with the fact that there doesn't seem to be much public literature on these questions.  A few thoughts:

        1. I don't agree with the argument that social returns on helping people are likely to be below financial rates of return.  Nick says that "returns will not be directed to priority interventions," but I disagree.  If you help people in the poorest parts of the world, you are hopefully empowering them to help others, by e.g. contributing to economic output in their area.  I think it's very possible that doing so has a *higher* return than aid financed by overseas donors, which has so many more degrees of separation from the people you're trying to help.

        2. I mentioned this to Nick offline, but to me one of the key reasons to expect giving opportunities to worsen over time is not just that Africa may become more developed, but that donors may capitalize on existing opportunities.  E.g., if and when a very wealthy person finds out about VillageReach and decides to fund it, you no longer have the same "opportunity" to help it.

        3. I think it's fairly unlikely that in the next 2-5 years, we'll find much better options than Stop TB and VillageReach within international aid.  I also think there's a good chance that they need the funds more now than they will then.

        4. However, I think there is a good chance that we will find a more promising option for donors in another area, particularly disease research.

        Bottom line - I think there are good arguments for "giving big" now or for waiting a few years for GiveWell's research to broaden/gel.  I don't think there are good arguments for waiting more than a few years.

        -Holden

        On Wed, Jan 13, 2010 at 10:01 PM, Nick Beckstead <nbeckstead@...> wrote:
         

        Hi Everyone,

        I've been on this list for about a year and a half, but I haven't made
        any posts. So let me introduce myself: I'm a Ph.D. student in the
        philosophy department at Rutgers University. My academic area of
        specialization is ethics. I care a lot about effective giving. I'm
        very excited about GiveWell's research.

        I'd like to get some input from some of you on the question of whether
        it would be best to give now, invest and give in the medium term, or
        invest and give much later. GiveWell hasn't been researching this
        kind of thing, but this question is important to me and I find it very
        difficult to answer. I suspect that some of you may care about this
        question as well, and that some of you have thought about it more
        carefully than I have. I think the best way to inform me about this
        will be for me to tell you what my hunches are and have people tell me
        what's wrong with them. So let me say a bit about how I'm approaching
        this issue and then describe my hunches.

        Suppose your goal is to maximize the expected benefit of your lifetime
        donations. These questions seem to be very relevant to determining
        the timing of an optimal giving strategy: (1) Will you be weak-willed
        and not do it later if you wait? (2) How large are the expected
        returns on social investment? (3) How large would the expected real
        gain be if you invested the money? (4) Will we be able to provide help
        more efficiently in the future? By how much? (5) Will giving now or
        giving later better encourage others to help more/more effectively? By
        how much? (6) Should you use some kind of future discounting rate?
        What rate?

        I doubt anyone has anything useful to say about (1). (6) is a
        question about which a fair amount of ink has already been spilled.
        I'm most interested in information on (4) and on how (2) and (3)
        compare.

        Here are my hunches, I'd like to know what some of you think of them.
        First hunch: for the foreseeable future, expected benefits accruing
        from financial return on investment leading to greater donations will
        significantly exceed expected benefits accruing from social return on
        investment. Reasoning: likely benefits related to social return on
        investment will not be directed to priority interventions; the rate of
        social return on investment would have to be implausibly high in order
        to be equally as great as expected benefits accruing from real
        interest being added to future donations to the best organizations.

        Second hunch: in the long run, priority programs will not be as
        effective as the are now, but the expected benefits of giving to the
        best organizations we'll know of in 2-5 years will be greater than the
        expected benefits of giving to the best organizations we know of now.
        Reasoning: the more developed a country is, the worse the best
        interventions are. In the long run, poorer areas will be more
        developed, so the best interventions in those countries will not be
        very good. For the 2-5 year range, we've gotten a lot of good
        information about effective giving over the last few years, in large
        part thanks to GiveWell (at least as far as the information I know of
        goes). This kind of analysis is new, and it wouldn't too surprising
        if we found an organization that was, say, 20% more effective than the
        best one identified so far over the next 2-5 years. This could be in
        the form of finding a more effective cause, or finding a more
        effective organization focusing on health aid for the international
        poor. (A conversation with Elie makes me worry that I've
        overestimated the probability of this happening). It's less likely
        that giving opportunities will become substantially worse during that
        time period.

        Third hunch: compared to the factors discussed above, the positive
        effects from my particular donations re: (5) will be small.
        Reasoning: this is such a complete hunch that I have nothing at all to
        back it up.

        If these hunches are right, it would suggest that it makes sense to
        wait 2-5 years to start giving big. Does it make sense to wait
        longer? I have no idea. Predictions about this seem a lot like
        predictions about how the copper market will be doing in 10 years.

        Those are the questions I'm asking and those are my hunches. So I
        want to be corrected by someone who knows more about this. Here are
        some ways my hunches could go wrong that I'm especially worried about.
        First, it could be that (i) VillageReach/Stop TB is still the best
        organization in 2-5 years and (ii) the funding situation for
        VillageReach/Stop TB makes it optimal to give now rather than 2-5
        years from now. Second, it could be that health interventions in
        developing countries are the best cause, and GiveWell has so
        thoroughly investigated this cause that we are unlikely to discover a
        significantly more effective organization in the next 2-5 years.
        Third, it could be that I've significantly underestimated the
        importance of giving now for making others give more and give more
        effectively. Fourth, it could be that I've significantly
        underestimated the rate of social return for giving to priority
        organizations.

        So what do you think about comparing (4) and comparing (2) and (3)?
        What do you think about my hunches? How worried should I be about the
        ways in which my hunches might be wrong? Any other thoughts on giving
        now vs giving kinda later vs. giving a lot later? I'd be especially
        interested if you can refer me to relevant literature on these issues.

        Best,

        Nick


      • Simon Knutsson
        Hi, I m an MSc student in economics and have volunteered for GiveWell sporadically. I ve hesitated to write because my point is simple and I thought Holden or
        Message 3 of 3 , Jan 23, 2010
        • 0 Attachment
          Hi, I'm an MSc student in economics and have volunteered for GiveWell sporadically. I've hesitated to write because my point is simple and I thought Holden or Elie would bring it up (and they know more about it than me), but they haven't yet and it was one of my main reasons for giving through GiveWell already in 2008 so here goes.

          My point is about Nick's question (5): "Will giving now or giving later better encourage others to help more/more effectively?" Nick writes "Third hunch: compared to the factors discussed above, the positive effects from my particular donations re: (5) will be small."

          My point is an argument for giving soon through GiveWell because it plausibly makes others donate more and more effectively:

          Giving through GiveWell makes GiveWell more able to show that its research has impact (i.e. that more money is given based on GiveWell's advice). This probably has at least two effects: (i) It makes it easier for GiveWell to get money for running costs and thus able to get a better website, market itself, produce better research, etc. (ii) It makes media and others talk more about GiveWell since it becomes a bigger player.

          (i) and (ii) should make people help more and more effectively and make charities sooner see that they get money by providing evidence of impact.

          I don't know how secure funding GiveWell has for its running costs but if its existence depends on being able to show that people donate a lot based on its advice, we have stronger reasons to donate soon. Especially considering that GiveWell closing down because it doesn't have enough for running costs may teach others that it's more difficult to get funding for work like GiveWell's and thus discourage others from doing this type of work.

          Best, Simon Knutsson


          On Sat, Jan 23, 2010 at 12:13 AM, Holden Karnofsky <holden0@...> wrote:
           

          Nick, I appreciate this very thoughtful email.  I am guessing that the silence has a lot to do with the fact that there doesn't seem to be much public literature on these questions.  A few thoughts:


          1. I don't agree with the argument that social returns on helping people are likely to be below financial rates of return.  Nick says that "returns will not be directed to priority interventions," but I disagree.  If you help people in the poorest parts of the world, you are hopefully empowering them to help others, by e.g. contributing to economic output in their area.  I think it's very possible that doing so has a *higher* return than aid financed by overseas donors, which has so many more degrees of separation from the people you're trying to help.

          2. I mentioned this to Nick offline, but to me one of the key reasons to expect giving opportunities to worsen over time is not just that Africa may become more developed, but that donors may capitalize on existing opportunities.  E.g., if and when a very wealthy person finds out about VillageReach and decides to fund it, you no longer have the same "opportunity" to help it.

          3. I think it's fairly unlikely that in the next 2-5 years, we'll find much better options than Stop TB and VillageReach within international aid.  I also think there's a good chance that they need the funds more now than they will then.

          4. However, I think there is a good chance that we will find a more promising option for donors in another area, particularly disease research.

          Bottom line - I think there are good arguments for "giving big" now or for waiting a few years for GiveWell's research to broaden/gel.  I don't think there are good arguments for waiting more than a few years.

          -Holden

          On Wed, Jan 13, 2010 at 10:01 PM, Nick Beckstead <nbeckstead@...> wrote:
           

          Hi Everyone,

          I've been on this list for about a year and a half, but I haven't made
          any posts. So let me introduce myself: I'm a Ph.D. student in the
          philosophy department at Rutgers University. My academic area of
          specialization is ethics. I care a lot about effective giving. I'm
          very excited about GiveWell's research.

          I'd like to get some input from some of you on the question of whether
          it would be best to give now, invest and give in the medium term, or
          invest and give much later. GiveWell hasn't been researching this
          kind of thing, but this question is important to me and I find it very
          difficult to answer. I suspect that some of you may care about this
          question as well, and that some of you have thought about it more
          carefully than I have. I think the best way to inform me about this
          will be for me to tell you what my hunches are and have people tell me
          what's wrong with them. So let me say a bit about how I'm approaching
          this issue and then describe my hunches.

          Suppose your goal is to maximize the expected benefit of your lifetime
          donations. These questions seem to be very relevant to determining
          the timing of an optimal giving strategy: (1) Will you be weak-willed
          and not do it later if you wait? (2) How large are the expected
          returns on social investment? (3) How large would the expected real
          gain be if you invested the money? (4) Will we be able to provide help
          more efficiently in the future? By how much? (5) Will giving now or
          giving later better encourage others to help more/more effectively? By
          how much? (6) Should you use some kind of future discounting rate?
          What rate?

          I doubt anyone has anything useful to say about (1). (6) is a
          question about which a fair amount of ink has already been spilled.
          I'm most interested in information on (4) and on how (2) and (3)
          compare.

          Here are my hunches, I'd like to know what some of you think of them.
          First hunch: for the foreseeable future, expected benefits accruing
          from financial return on investment leading to greater donations will
          significantly exceed expected benefits accruing from social return on
          investment. Reasoning: likely benefits related to social return on
          investment will not be directed to priority interventions; the rate of
          social return on investment would have to be implausibly high in order
          to be equally as great as expected benefits accruing from real
          interest being added to future donations to the best organizations.

          Second hunch: in the long run, priority programs will not be as
          effective as the are now, but the expected benefits of giving to the
          best organizations we'll know of in 2-5 years will be greater than the
          expected benefits of giving to the best organizations we know of now.
          Reasoning: the more developed a country is, the worse the best
          interventions are. In the long run, poorer areas will be more
          developed, so the best interventions in those countries will not be
          very good. For the 2-5 year range, we've gotten a lot of good
          information about effective giving over the last few years, in large
          part thanks to GiveWell (at least as far as the information I know of
          goes). This kind of analysis is new, and it wouldn't too surprising
          if we found an organization that was, say, 20% more effective than the
          best one identified so far over the next 2-5 years. This could be in
          the form of finding a more effective cause, or finding a more
          effective organization focusing on health aid for the international
          poor. (A conversation with Elie makes me worry that I've
          overestimated the probability of this happening). It's less likely
          that giving opportunities will become substantially worse during that
          time period.

          Third hunch: compared to the factors discussed above, the positive
          effects from my particular donations re: (5) will be small.
          Reasoning: this is such a complete hunch that I have nothing at all to
          back it up.

          If these hunches are right, it would suggest that it makes sense to
          wait 2-5 years to start giving big. Does it make sense to wait
          longer? I have no idea. Predictions about this seem a lot like
          predictions about how the copper market will be doing in 10 years.

          Those are the questions I'm asking and those are my hunches. So I
          want to be corrected by someone who knows more about this. Here are
          some ways my hunches could go wrong that I'm especially worried about.
          First, it could be that (i) VillageReach/Stop TB is still the best
          organization in 2-5 years and (ii) the funding situation for
          VillageReach/Stop TB makes it optimal to give now rather than 2-5
          years from now. Second, it could be that health interventions in
          developing countries are the best cause, and GiveWell has so
          thoroughly investigated this cause that we are unlikely to discover a
          significantly more effective organization in the next 2-5 years.
          Third, it could be that I've significantly underestimated the
          importance of giving now for making others give more and give more
          effectively. Fourth, it could be that I've significantly
          underestimated the rate of social return for giving to priority
          organizations.

          So what do you think about comparing (4) and comparing (2) and (3)?
          What do you think about my hunches? How worried should I be about the
          ways in which my hunches might be wrong? Any other thoughts on giving
          now vs giving kinda later vs. giving a lot later? I'd be especially
          interested if you can refer me to relevant literature on these issues.

          Best,

          Nick



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