I think the presentation of this argument here misses some important considerations:
- The way that you want us to act with respect to OP is already the way that OP is trying to act with respect to the rest of the world.
- The same considerations that lead OP to choose not to allocate all their funds to the highest expected value cause should also be relevant for individual donors, and could legitimately mean that they should diversify as well. There seems to be an inconsistency in saying these considerations are valid for OP but not for individuals.
- Even if you are a pure marginal EV maximizer (you think these considerations are invalid for OP and for invidiauls), OP's donations won't always be relevant to your donation decisions, and if they are, it is the absolute amounts donated, rather than the percentages, that are relevant.
The way that you want us to act with respect to OP is already the way that OP is trying to act with respect to the rest of the world
EAs don't fund the most important causes, based purely on scale (otherwise tonnes of things EAs ignore would score highly, e.g. vaccination programs in rich countries). A core part of EA is looking for causes which are neglected. We look for the areas that are receiving the least funding relative to what they would receive in our ideal world, because these are likely to be the areas where our donations will have the highest marginal impact.
This is the reply to people who argue "oh you want local charities to disappear and to send all the money to malaria nets". The reply is: "No! In my ideal world, malaria nets would quickly attract all the funding they need. Then there would still be plenty of money left over for other things. But I think I should look at the world I actually live in, recognize that malaria nets are outrageously underfunded, and give all my resources there."
So in a sense, the argument you are making here isn't anything new. You are just saying we should try to act towards other EAs in a similar way to how EAs as a group act towards the rest of the world. And I don't disagree with this. But I think we should go all the way. I think we should treat other EAs in the same way that we treat the rest of the world. If I understand your argument correctly, you are trying to draw a distinction between the EA community and everyone else.
The same considerations that lead OP to choose not to allocate all their funds to the highest expected value cause should also be relevant for individual donors
OP do not allocate all of their funding to the 'best' cause. Even if OP were a pure EV maximizer, they might have valid reasons not to do this, because they have such a big budget. It may be that diminishing marginal returns mean that the 'best' cause stops being the best once OP have given a certain level of funds to it, at which point they should switch to funding another cause instead.
But my impression is that this is not OP's reason for donating to multiple causes (or at least not their only reason). They are not purely trying to maximize expected value, or at least not in a naive first order way. One reason to diversify might be donor risk aversion, like you mention (e.g. you want to maximize EV while bounding the risk that you have no positive impact at all), and there are plenty of other considerations that might come into it too, e.g. sense of duty to a certain cause, reputation, belief in unquantifiable uncertainty and impossibility of making certain cause comparisons etc
But if these considerations are valid for OP then they should also be relevant for individual donors. For example, if an individual donor wants to bound the risk that they have no impact, then that might well mean not donating everything to the cause they think is most underfunded by OP. It would only make sense to do this if they had a weird type of risk aversion where they want to bound the risk that the EA community as a whole has no positive impact, but are unconcerned about their own donations' risk. This seems very arbitrary! Either they should care about the risk for their own donations, and should diversify, or they should be concerned with all of humanity's donations, in which case OP should not be diversifying either!
Pure EV maximizers don't care about percentages anyway
You could bite the bullet and say that neither OP nor individual donors should be diversifying their donations (except when faced with diminishing marginal utility). For these individual donors, they should be donating everything to one cause (and probably one charity unless they have a lot to give!) But even for these donors, it's not which causes OP underfund that really matters. It's what causes all of humanity underfund. So it is not the percentages of OP's funding allocation that matter, it's the absolute value.
If OP are a relatively small player in a cause area (global health..?) then their donation decisions are unlikely to be especially relevant to the individual donor. If they thought global health was the top cause before OP donations were taken into account, it probably still will be afterwards. But if OP are a relatively big player (animal welfare..?) then their donations are more relevant, due to diminishing marginal utility. But it is the absolute amount of funding they are moving, not the percentages, which will determine this.
While I think this piece is right in some sense, seeing it written out clearly it feels like there is something uncooperative and possibly destructive about it. To take the portfolio management case:
Why do the other fund managers prefer 100% stocks? Is this a thoughtful decision you are unthinkingly countering?
Each fund manager gets better outcomes if they keep their allocation secret from others.
I think I'm most worried about (2): it would be bad if OP made their grants secret or individuals lied about their funding allocation in EA surveys.
Tweaking the fund manager scenario to be a bit more stark:
There are 100 fund managers
50 of them prefer fully stocks, 50 prefer an even split between stocks and bonds
If they each decide individually you'd get an overall allocation of 75% stocks and 25% bonds.
If instead they all are fully following the lessons of this post, the ones that prefer bonds go 100% bonds, and the overall allocation is 50% stocks and 50% bonds.
It feels to me that the 75-25 outcome is essentially the right one, if the two groups are equally likely to be correct. On the other hand, the adversarial 50-50 outcome is one group getting everything they want.
Note that I don't think this is an issue with other groups covering the gaps left by the recent OP shift away from some areas. It's not that OP thought that those areas should receive less funding, but that GV wanted to pick their battles. In that case, external groups that do accept the case for funding responding by supporting work in these areas seems fine and good. Which Moskovitz confirms: "I'm explicitly pro-funding by others" And: "I'd much prefer to just see someone who actually feels strongly about that take the wheel."
(This also reminds me about the perpetual debate about whether you should vote things on the Forum up/down directionally vs based on how close the vote total currently is to where you think it should be.)
I think these unsavory implications you enumerate are just a consequence of applying game theory to donations, rather than following specifically from my post's arguments.
For example, if Bob is all-in on avoiding funging and doesn't care about norms like collaboration and transparency, his incentives are exactly as you describe: Give zero information about his value system, and make donations secretly after other funders have shown their hands.
I think you're completely right that those are awful norms, and we shouldn't go all-in on applying game theory to donations. This goes both for avoiding funging and for my post's argument about optimizing "EA's portfolio".
However, just as we can learn important lessons from the concept of funging while discouraging the bad, I still think this post is valuable and includes some nontrivial practical recommendations.
Maybe we need to flip this around. Instead of tracking how much funding was allocated to a certain cause area, we should be tracking the expected marginal opportunity in each and comparing those. I.e., what was the expected result of a marginal $1M donated to each cause area on average in, say, a given year?
This does not incentivize for making the allocations secret since the decisions are made based on the current state of the "market" irrespective of any previous allocations.
Going back to the 100 fund managers example, I think I'd much prefer them to individually recognize that people preferring the alternative allocation are just as competent in the decision as they are (in an ideal case), and as a result, apply the uncertainty to their own preference (making it 75-25 instead of 100-0/50-50) rather than relying on an external mechanism.