Effective Altruism (EA) is a philosophy and social movement with the explicit goal–and real potential–to do a great deal of good in the world.
As with many philosophies and ethical systems, EA becomes absurd or counterproductive when taken to an extreme. For example, an exclusive focus on quantitative outcomes would not only neglect qualitative outcomes like diversity, equity, and inclusion (DEI) but also miss out on the perspectives that come with DEI that help an organization to be more effective. Like other social movements, EA is based on non-universal values, in this case values that could be criticized as technocratic. This is a feature of social movements, not a problem in and of itself.
As such, this essay will focus on inconsistencies within EA, not on the validity of its underlying values or on thought exercises of what happens when taking it to an absurd extreme. Of course, as with any social movement, there is a diversity of viewpoints and approaches within the movement, and generalizations about it like those in this essay do not apply to every individual or organization. As an additional caveat, this essay is written from a contemporary Western perspective and parts may not apply to other contexts, such as where lobbying is illegal.
This essay is organized into three sections: general inconsistencies, relevance to a limited population, and overlooked cause areas. The latter two are inconsistencies in the movement, not necessarily in the underlying philosophy, in that they get in the way of the core principle of maximizing effectiveness.
There are inconsistencies between the words “effective altruism,” what effective altruists (EAs) actually believe, and what EA actually does.
The philosophy and movement is called “effective altruism”. According to dictionary.com, “effective” has 4 meanings, the relevant one of which is “adequate to accomplish a purpose; producing the intended or expected result”. Much of what EA focuses on is much too high risk to be considered highly effective by this dictionary definition. By a standard of adequacy to accomplish a purpose, one would, for example, prioritize
This is clearly not the type of logic that actually gets applied in EA, which tends to favor higher risk projects. There’s definitely a role for philanthropy in high-risk projects. Low-risk projects can be done by a government easily at scale, whereas a government faces principal-agent problems when trying to do higher-risk projects. But “effective'' isn't the best word to describe high-risk high-impact projects.
What EAs actually believe in would be more precisely described as “scope-sensitive altruism”. EAs are concerned with the scale of social impact, positive or negative, and are largely agnostic with respect to risk. EAs also tend to be agnostic with respect to the place and time of impact and the relationship between the altruist and the beneficiaries of their altruism.
What EA actually does would be more precisely described as “efficient altruism”. While the philosophy of EA suggests maximizing a social impact counterpart to profits, what EAs tend to actually focus on is maximizing a social impact counterpart to return on assets. In business and investing,
Net income = Equity capitalization * Equity multiplier * Return on assets
The equity capitalization and equity multiplier (assets/equity, or leverage) play key roles in determining net income. Similarly, in order to be effective, or more precisely scope-sensitive, EAs and EA organizations need to pay careful attention to each term of the above equation when analyzing priorities and strategies.
In the context of an individual career, assuming a fixed input of equity is reasonable in that the number of hours one has available is relatively fixed. But in the context of philanthropy, it’s quite plausible that a strategy of increasing the amount of donations might be more effective than one of increasing the efficiency of existing donations. The Giving What We Can pledge is an attempt to increase total giving but not necessarily the most effective approach to doing so.
An alternative approach to increasing total giving that might be more effective is for EA organizations to invest more in organizational development and to improve management. Programmatic efficiency is one factor in determining organizational effectiveness but not necessarily the most important one, particularly in the long term. An effective organization, one that’s on a path for long-term growth, will also have a well-functioning board, a clear strategy based on a sophisticated understanding of business and finance as well as the subject matter, a diverse and well-qualified team, solid financial management, a leadership succession plan, and so forth.
For example, fundraising staff at a well-managed organization are likely to be well qualified and well paid; have access to a plan that appeals to donors with a variety of motivations (which might include religion, giving back, or social connection as well as social impact); have access to software to identify those with high capacity, propensity, and affinity; and be held accountable for results. In EA organizations in particular, a common organizational weakness is a lack of age diversity among both board and staff.
In order to make their giving effective and not merely efficient, EAs who are not in a governance or management position should consider good management, or a commitment to improving weak management, as well as programmatic efficiency, in their donation decisions.
One way to be successful in business is to find an opportunity with a high return on assets, which is common in technology. But many successful business people have instead operated businesses with low returns on assets like banking, real estate, or grocery stores, and used debt as leverage to increase the return on equity.
When the goal is social impact rather than profit, debt is not the only option to increase leverage. EA organizations are commonly leveraged in the sense of outsourcing capital and operationally intensive activities like operating a hospital in favor of things like financing and advising. Some also use political advocacy to potentially achieve leverage through government financing and policy change.
Maximizing the benefits of leverage can involve making compromises on efficiency, not merely asking others to join in financing a highly efficient project. Bankers, bond buyers, and government policymakers control large amounts of capital but tend to be risk-averse, meaning that it’s likely to be much easier to leverage a low-risk project with debt or government funds. Nonprofit organizations and private foundations are guided by a variety of values, so when it comes to nonprofit partnerships the qualitative breadth of social benefits from a project matters to an EA’s ability to achieve positive social impact at scale. In principle, one dollar or one hour devoted to a low-risk endeavor or one that appeals to a variety of values could, through leverage, accomplish more towards a particular goal than one that’s devoted to an endeavor that’s the most efficient at advancing that same goal.
For example, consider an EA choosing between supporting a cash transfer program in a low-income country or one in a middle-income country. When viewed in isolation, the program in the low-income country is likely to surface as a priority because a fixed budget can create bigger life changes when the beneficiaries are poorer. Yet cash transfer programs have actually accomplished more in middle-income countries due to the ability of national governments to take them to scale.
As typically practiced, EA is most relevant to a young adult with a high level of education in a quantitative field and a relatively high income. The EA movement provides considerable guidance around directing donations and choosing career paths, and to a lesser extent how to found a charitable organization. It tends to overlook the importance of board and public service as well as of investments, all of which can be highly relevant for older age groups. To be more effective, the movement needs to be more broadly relevant, both to larger populations and to those with the most influence in society. The remainder of this section lays out some specific services that existing or new EA organizations could provide in order to make the movement more broadly relevant, and thus more effective.
The EA-aligned career counseling service 80,000 Hours is only able to serve those with a relatively specific and elite background. People from an elite background may have more options, but that does not necessarily mean that EA is more relevant to them. For example, an Ivy League graduate choosing between an offer at a securities broker and one at a commodities broker could simply choose the higher paying offer and be reasonably confident that it’s likely to lead to the highest positive impact on society.
In contrast, someone deciding whether to work on the family farm or join the military faces a complex choice where utilitarian ethics could actually be more helpful. Farming and military service contribute to food security and national security and can have implications for society that are well out of proportion to the associated earnings. 80,000 Hours or other EA organizations should develop service offerings, possibly supported by hourly fees, to serve those seeking career advice in a greater variety of contexts.
Career advice obviously needs to be customized to the individual, but this is true for donation advice as well. In an investment context, a blanket recommendation that does not consider individual goals, risk tolerance, or time horizon can be a violation of regulations or professional ethics. As with investments and careers, there needs to be a fit with the client. And EA as a profession would be more inclusive than EA as a community–as with a doctor, you wouldn’t have to become one to take advice from one.
There are relatively few philanthropic advisers, and in most cases philanthropic advisory services are incidental to estate planning, investment and retirement planning, private banking, or other financial advisory services. But philanthropic advisory services are affordable to a much larger population than is currently using them. For example, a middle-income American who earns $50,000 per year and follows the Giving What We Can pledge would be giving $5000 per year. If such a person were not trained in quantitative social sciences or didn’t wish to evaluate primary literature directly, a professional plan would be a good investment considering the potential for EA-guided prioritization to increase the impact of their donations by 10 or 100-fold.
A key part of an EA-aligned philanthropic advisory service would be defining a client’s values. Some key values include risk tolerance, time horizon, and geographic (or non-human) scope. If the client requires proven solutions in the here and now, EA is likely to not be particularly helpful and they should perhaps be referred to a non-EA philanthropic adviser. But if they’re aligned with just some elements of high-risk, long-term, or international or interspecies thinking, then an EA-aligned philanthropic adviser should be able to help them. For example, a client might care about animals but not about international development or vice-versa, and in either case EA could be helpful.
Before making customized recommendations, an EA philanthropic adviser would want to
Philanthropy is not the most efficient tool to address every social problem. Large opportunities exist in areas like renewable energy, medical research, and affordable housing to address social problems and make a profit at the same time, and in these contexts an investment that can be recouped and recycled into another project is often a more efficient use of capital than philanthropy. Millions of people own or manage assets that are substantial in relation to their income, and some of these people may be able to accomplish more for society through their investments than their donations.
Incorporating impact investment into an EA framework could help improve the relevance of EA to climate change as well as its relevance to older and wealthier individuals. EAs typically care about climate change but don’t prioritize it because it’s too expensive to address with philanthropy. However, there are huge opportunities for impact investment, both equity and debt, in addressing climate change, as well as opportunities for philanthropic capital to facilitate the development of financial markets for addressing climate change and thus have highly leveraged impact competitive with public health or other typical EA areas of focus.
Maximizing positive social impact through careers, donations, and nonprofit entrepreneurship could all be summarized as showing civic leadership. But there’s a large gap in EA practice around governance, which is a critical component of civic leadership, one where large opportunities exist, and one that many EAs fall into incidentally while supporting causes and taking initiative.
There are approximately 20 million nonprofit board positions in the US and several million seats on public boards and commissions and in elected offices. That’s about one position for every two college graduates aged 30-65, the primary demographic filling them. In some countries, there are fewer, but in India, there are even more. And they have a lot of influence on society. In the American federal government, there are roughly 5 members of Congress for every executive-branch official of a similar level of authority. In a small nonprofit organization, the board might be the entire organization with no staff or other volunteers. In a city government, members of a commission might have similar authority to the staff members they work with, but in most cases it’s much easier to get on the commission than to get hired by the city. A nonprofit organization might receive 100 applications for a staff position while struggling to fill a board position.
EAs and others inclined towards civic leadership often make their greatest contributions to society as a board member or elected official, not through their donations or career. New or existing EA organizations should offer training programs for both boards and elected office to reflect the importance of such governance positions in society.
This discussion has thus far focused on management rather than specific cause areas and hasn’t addressed specific substantive priorities. EA is all about finding overlooked cause areas. Has anything big been overlooked?
The closest thing to an authoritative taxonomy of charitable cause areas is the National Taxonomy of Tax-Exempt Entities published by the US Internal Revenue Service. There are 25 categories in the taxonomy (plus one for “uncategorized”). Of these, about 10 are things that EAs regularly discuss, including
D Animal related
E Health General & Rehabilitative
F Mental Health, Crisis Intervention
G Disease, Disorders, Medical Disciplines
H Medical Research
M Public Safety, Disaster Preparedness and Relief
Q International, Foreign Affairs, and National Security
T Philanthropy, Voluntarism, and Grantmaking
U Science and Technology Research Institutes
V Social Science Research Institutes
Among the categories that EAs do not regularly discuss as priority cause areas, the reason is more obvious in some cases than in others. Four of the categories are mainly for social and business clubs, as opposed to charitable organizations:
N Recreation, Sports, Leisure, Athletics
S Community Improvement, Capacity Building
W Public, Society Benefit
Y Mutual/Membership Benefit Organizations, Other
These organizations are largely in the business of serving their own members rather than taking donations to serve the general public, and thus there is a clear reason not to prioritize them for donations.
Another four appeal to more qualitative values such as rights, responsibilities, creativity, and participation:
A Arts, Culture, and Humanities
I Crime, Legal Related
R Civil Rights, Social Action, Advocacy
X Religion, Spiritual Development
One could certainly debate the merits of these values, but from the perspective of internal consistency it’s clear why they don’t typically surface as priority cause areas for more quantitatively oriented EAs.
That leaves the following seven categories:
B Educational Institutions
C Environmental Quality Protection, Beautification
J Employment, Job Related
K Agriculture, Food, Nutrition
L Housing, Shelter
O Youth Development
P Human Services
EAs definitely care about many of these issues, and typically earn high levels of education (B) and spend significant time reflecting on career paths (J). Issues like climate change (C) and affordable housing (L) are often top-of-mind.
The primary reason that these cause areas don’t tend to appear at the top of EA priority lists is that most of them are associated with sufficiently low risk that they can be relatively easily financed through government or debt markets. For example, housing is a low-risk investment with private benefits (thus it can be funded primarily by debt supplemented by a bit of equity) and some public benefits (thus it can be funded by the government).
There is a significant role for equity investments in environment (clean tech), agriculture (ag tech), and affordable housing (to de-risk it for debt investors and government). All three of these areas would likely get more attention if EA organizations were to cater to those looking for impact investment opportunities.
The area where philanthropy plays the most critical role is agriculture, particularly agricultural research in developing countries. In this context, intellectual property (IP) is difficult to protect, leading to under-investment from the private sector. The public sector also under-invests because, as with other types of innovation, it can be difficult for voters or taxpayers to differentiate between honest failure and corruption.
Agriculture and agricultural innovation have of course been recognized as important cause areas for some time. Consider, for instance:
Returns to public investment in agricultural research is one of the most studied topics in agricultural economics, and contemporary economists have found high social returns to agricultural research in hundreds of studies. Benefits range from farm income, to nutrition, to adapting to changing climate. Studies have indicated that breeding more nutritious crops can be a more cost-effective way of improving public health than public health programs. This is exactly the type of thing that should interest EAs, who get excited about studies that, for example, suggest that providing deworming drugs to help kids stay healthy might be a more cost-effective way of improving educational outcomes in Kenya than funding schools. Yet with the exception of the Alliance to Feed the Earth in Disasters, no organizations working on agricultural innovation are getting attention in EA.
Philanthropy in agricultural research is dominated by the Gates Foundation and other major foundations, which have a high cost structure and can thus only consider larger projects. Individuals have almost no way to get involved, so projects where IP is difficult to protect in the private sector (i.e., most of them in developing countries), that are too innovative for a government, and that don’t fall within the scope of a couple of major foundations’ programs fall through the cracks. Marketing of agricultural research as a cause area is about as terrible as that of AI safety or some other causes that EAs subscribe to, if not worse. An organization with a bureaucratic-sounding acronym that only accepts funds via wire transfer might have great programs but is probably missing out on all but the largest and most sophisticated of donors.
An organization I founded, Grow Further, is working to transform the agricultural innovation sector by providing a mechanism for individuals to support agricultural research in developing countries. We’re looking to not only offer the opportunity to invest in high-impact projects but also to create an entire sector of agricultural research charities analogous to the sector of medical research charities.
EA is a philosophy and movement with great potential to make the world a better place. It suffers from a certain degree of young urban elite bias that results in overlooking agriculture as well as some weaknesses in management and implementation. Improving diversity and management and making the ideas relevant to more people could increase its effectiveness without the need to compromise on any of its values.
The author is founder of Grow Further, which supports innovation for global food security, and holds a PhD in Agricultural and Resource Economics from UC Berkeley. He is eager to collaborate on implementing the ideas in this essay and can be reached at [email protected] .
