Discussing Giving Season 2014

It's giving season in the American tax year. As in previous years, some people in the effective altruism movement have been asking to talk about their giving decisions with me, and I would like to extend the offer of a sounding board to the readers of this blog. You can contact me by email, facebook, or by leaving a comment below with contact information (comments with contact info will be kept in moderation and not published).

Second generation human capital benefits of migration

Summary: One important element in estimating the benefits of liberalized migration is the effect on the human capital of migrants' children. Taking human capital benefits of childhood in a developed country into account increases estimates of overall benefits, and may favor permanent migration relative to temporary guest worker programs. I discuss human capital benefits in health, language competence, educational attainment, gender equality, and attachment to location. Benefits are largest and important for immigrants with initially low human capital. Some but not all of these benefits can be attained using retained earnings of temporary migrant workers to help their children at home.

Population ethics and inaccessible populations

Summary: On some views in population ethics, including diminishing marginal value and average views, the value of producing future generations depends on the quantity of beings and welfare in times and places beyond our causal reach. Within these viewpoints large future populations do not automatically have overwhelming moral importance. However, if there are large inaccessible populations, then perspectives like these will-like total utilitarianism and its kin-also place overwhelming weight on the interests of large future populations. Past generations of hominids, and especially of non-human animals, greatly outnumber the current generation, and provide such an inaccessible population. Life elsewhere in the universe might do so as well. Such populations, in addition to changing the recommendations within these theories, may or may not reduce the weight given to the theories in deliberation.

Increasing and improving saving as a philanthropic cause

Summary: While labor's share of world GDP is over one half, capital's share is close to one third. When considering altruistic interventions to increase economic output, as in GiveWell Labs' exploration of U.S. policy, efforts to increase saving and investment should be considered alongside efforts to improve effective labor supply. Compulsory savings schemes and government savings schemes have been used in other developed countries to induce savings far above U.S. levels, and global adoption of such schemes could produce annual gains of many trillions of dollars, although the potential gains are substantially less than the potential gains of labor mobility. Regulatory changes to default pension/investment contributions might also capture important, albeit smaller, gains.

How migration liberalization might eliminate most absolute poverty

Summary: While some estimates that open borders would double gross world product implicitly project the migration of most of the developed country labor force, a much smaller quantity of migration might cut global poverty rates by half or better. The additional income to the poorest required to bring them above extreme poverty lines is in the hundreds of billions of dollars per annum, while doubling world product would approach a hundred trillion dollars of additional annual output. Legal barriers to migration, and blocked desire to migrate, are most extreme for the poorest countries, suggesting extra migrants from those sources. While migrants may receive more income gains than are needed to escape absolute poverty remittances to family, trade, and investment may help to distribute the gains more widely. Overall, the case that migration liberalization for less skilled workers could eliminate most absolute poverty is significantly more robust than the most extreme estimates of global output gains.

What does migration to the United Arab Emirates tell us about labor mobility?

Summary: Some notes on migration to the United Arab Emirates (UAE). As in some other Gulf oil states, e.g. Qatar, almost the entire UAE private sector workforce is composed of foreign guest workers. The ratio of foreign workers to natives is high enough that if achieved by all developed countries it could absorb the labor force of the developing countries. The distribution is dominated by less skilled workers and workers from poor countries, who enjoy much higher wages than at home, but much lower than in countries such as the United States. Emirati tolerance of extremely high immigration may be related to the almost complete insulation of Emirati nationals private labor markets, and the exclusion of migrants from citizenship and access to government revenues. In Dubai, the native population primarily subsists on taxes on the foreign-dominated private sector, enjoying an extremely prosperous standard of living. The UAE shows that truly massive guest worker programs can greatly benefit migrants and natives when politically feasible, and could eventually eliminate most global poverty if broadly imitated. 

Migration levies and unskilled labor mobility in Singapore

Summary: Several advocates of increased labor mobility have suggested taxes on migrants to compensate natives of destination countries for any inconveniences and to increase the reward of accepting more migrants, as a theoretical matter. In practice Singapore already accepts an exceptionally large number of unskilled and less skilled temporary workers, taxes them heavily, and uses the extensive net revenue to make a significant contribution to the public accounts. It appears that Singapore captures most of the economic surplus of migration, although migrants also benefit significantly. However, the system produces great local inequality and has a number of other problems that may outweigh fiscal benefits in its political appeal. While Singaporean migration policy seems much better than most developed countries', it is not first-best from a humanitarian point of view, and the model's value in promoting labor mobility elsewhere is uncertain, although intriguing.

What do null fields tell us about fraud risk?

Summary: Efforts to improve scientific integrity must grapple with both questionable research practices that fall within the current "rules of the game" and outright misconduct. Survey and audit data suggest disturbing lower bounds for misconduct, and suggest the possibility of rates high enough to meaningfully distort readings of the scientific literature. The problem could be worse for "null fields" studying nonexistent effects, and for studies that seemingly have top methodological standards. I discuss this analysis in the context of cold fusion and parapsychology, commonly thought to be null fields. These fields may be more at risk of fraud than others, but may also provide a warning about the potential for misconduct in more conventional domains.

Tech and finance in the Forbes 2013 billionaire list

Summary: A rough breakdown of the 2013 Forbes billionaire list members classified to the technology and finance sectors, in terms of numbers, total wealth, and age. While finance-related billionaires outnumber tech billionaires substantially, the advantage is much less in terms of total wealth. Tech is better represented among American and especially among younger billionaires. Many disclaimers apply, and data on these extremes should not be given excessive weight in evaluating the expected financial returns of careers, which are primarily driven by much less extreme outcomes, and must be adjusted for human capital and population.

GiveDirectly, happiness, and log income

Summary: A juxtaposition of the work of economist Justin Wolfers and colleagues on the relationship between reported subjective well-being and income, and the Haushofer and Shapiro (2013) RCT estimates of well-being impacts for GiveDirectly.

Upward and downward biases in the "double world GDP" estimates of the gains of open borders

Summary: I discuss recent estimates that open borders could double gross world product through increases to migrant productivity. Such a doubling would be extreme, but not out of the range of our experience: it would be equivalent to raising world per capita income to the level of Greece (U.S. levels would quadruple world product), or a couple decades of continued economic growth. However, it would require the great majority of the developing world to migrate. I discuss the migration levels required for the estimates, polling and historical data bearing on migration levels, and population and economic growth trends that affect the estimates. Over several decades, the impact estimates seem too high, requiring implausible quantities and rates of migration, although potential effects remain large. Over the longer term, boosts such as population growth in poor countries and increased education for second generation migrants increase the maximum potential of migration beyond doubling world output, but development in poor countries, changes in place premium, and other changes may reduce gains over time.

What portion of a boost to global GDP goes to the poor?

Summary: How should individuals compare the impact of donations made to the world's poorest with changes in overall economic activity which are not specifically targeted at the poor, but proportionally increase incomes worldwide? World income is on the order of 30 times income for GiveDirectly recipients, so the cost of generating a similar immediate boost in log income would also be about 30 times as great. Some industries are more evenly distributed across the world than others: an economic change that delivered equal absolute dollars gain to people around the world might only need to be a few times greater. I discuss some industries that may illustrate these poles and intermediate levels. Changes in foreign aid from dollars to rich countries appear less important than growth impacts on poor countries.

Cancer vs malaria: burden, treatment spending, R&D spending, R&D results

Summary: I compare the burden, treatment spending, and R&D spending for cancer and malaria worldwide. Cancer causes somewhat more than twice the DALY burden of malaria, but has almost 14 times the global R&D budget per DALY, and almost 60 times the global treatment budget per DALY. Funding for malaria, which is controlled by donors, has a much higher share dedicated to R&D than cancer spending. That R&D also seems to produce more results, indicating diminishing returns at work in medical R&D.

A glance at the United Kingdom's Department for International Development (DfID), and careers in government grantmaking

Summary: I take a quick glance at the financial statements of  the United Kingdom's foreign agency, the Department for International Development (DfID). The agency's portfolio includes many highly effective interventions, but likely has some room for improvement in its funding allocation and delivery. Its budget is more than $6.5 million per employee, suggesting that if an employee has at least a modest positive influence over DfID activities, then he or she could do more direct good there than by working in industry and donating to the most effective international health charities. I suggest looking more closely at this broader category, of careers in government grant allocation.

It's harder to favor a specific cause in more efficient charitable markets

Summary: People vary widely in their views on the relative importance of different causes, interventions, and charities. Those with strong idiosyncratic beliefs favoring one might expect they will have much greater impact by focusing on the favored cause. However, "smart money" which moves in pursuit of marginal returns, can mean that targeted support simply displaces flexible support, instead of adding to it. For example, attempts to favor one of GiveWell's recommended charities relative to others can easily be thwarted as GiveWell attends to room for more funding and diminishing returns in making its recommendations. Insofar as the effective altruist movement increases this dynamic, it will tend to link different causes and interventions together.

If big donors have much better opportunities than small donors, then small donors can go to Las Vegas, or Wall Street

Summary: For various reasons, donors giving large amounts may be able to achieve more per dollar with their donations, enjoying economies of scale. When this is true, small donors may be able to do more good by exchanging a donation for a lottery with a 1/n chance of delivering a donation n times as large. In practice, transaction costs and taxation mean the donation will be smaller, a cost which must be compared against scale economies. However, the use of randomization, casino gambling, derivatives, and other institutions can limit lottery costs to a modest factor, lowest when investments are used. So small donors who believe strong scale economies exist can take advantage of them.

Recent growth at Giving What We Can and GiveWell

Summary: For the last three years Giving What We Can's number of additional members each year has been fairly steady. The same was true of GiveWell's increases in number of donors and money moved (excluding Good Ventures) for 2010-2012. However, small donors to GiveWell have shown accelerated growth in 2013 following Peter Singer's TED talk, which may be reflected by large donors as the figures for the 2013 giving season become known.

Turning log-consumption into a [crude] measure of short-run human welfare

Summary: [This post is intended more as notes than for a general audience.] Many have praised log income as a good proxy for individual humans' welfare. While log income alone is useful for analyzing transfers within a fixed population, when spending can also change population (e.g. through saving lives, contraception, assistance for parents) log income must be supplemented to produce a measure that tracks welfare, e.g. with an estimate of the value of a life at a subsistence income compared to the value of a life at some higher income. I then take a first pass at global income distribution statistics in this light.