- I sometimes hear prospective employees feel like they are "overqualified" for EA positions by trying to compare relevant metrics. E.g. "you don't need a product manager if you have less than 5,000 page views per day." I think this is misunderstanding a key difference between altruistic and profit-motivated organizations.
- Many companies only capture a small fraction of the value they produce. Nordhaus 2004 estimates that companies capture about 2% of the value they create through innovation.
- This means that companies underinvest their products (relative to the social optimum), because they can't capture the value from improved products.
- Therefore, altruistic organizations should invest substantially more into their products than comparable for-profit organizations do.
- As a concrete example: Reddit has approximately one employee per 600,000 users, whereas this Forum has approximately one employee per 13,000. Interestingly, this is almost exactly the 50x multiple Nordhaus would predict.
- I would further argue that it's multiple orders of magnitude more valuable to attract a user to the EA Forum than to Reddit, so the 50x multiple should be even higher, though obviously I have a bias.
- I think this adjustment for externalities is still not actually the right way to make career decisions – you should think more about the impact you have, not how some arbitrary metric compares – but if you are going to consider arbitrary metrics, I think you should consider adjusting by a large amount.
Some of these ideas are also referenced in the tech entrepreneurship 80 K article.
Reddit data taken from https://backlinko.com/reddit-users. There are four people who work full-time on the Forum (JP, Sarah, Clifford, Lizka); without evidence I will claim that the portion of operational staff who support them add up to a 5th FTE. Forum MAU count from Google analytics, trailing 28 days ending May 17, 2022.
Of course, this is oversimplified. For example, presumably there are diminishing returns to labor, so naïvely multiplying employees by 50 is too simplistic.