Examples of Moral Economics Concepts

Let us look at some examples of Moral Economics concepts that have been suggested in the last few years, and conceive of branches or sub-fields which lump some of these concepts together.

Altruistic Arbitrage: Analogous to the concept of Arbitrage, the concept serves to facilitate reasoning about opportunities for trade that are morally profitable.

Certificates of Impact: These consist of certificates that are bought after the fact for a past altruistic action or a fraction of one, which later can be traded or sold. An attempt to make the Moral Market for actors with altruistic inclinations be explicit and numerical, by creating a form of floating currency that permits exchange in space and time between the two markets - notice that inter-temporal backwards trade was not available for altruistic actions before this idea, you could not today cooperate and trade with past altruist action.

Intertemporal Coordination Problems for Donations: To donate maximally impactfully to a fundraiser with a deadline, it seems prima facie that one should wait until the last minute to guarantee that someone else donates instead of you, since your goal is that resources go to that event, not that your resources go to that event. This way you make sure your moral values are satisfied, and keep the resources to satisfy even more of your values. This is different from buying an apple for yourself, where you anticipate the only way of getting it is if your resources purchase it. In the altruistic case, as long as someone pays for the valuable thing, your value is satisfied.

This however poses a tragedy of the commons type incentive, where each individual will be better off (morally) by holding on to their resources for longer than would be desirable from the group's perspective. It becomes more difficult to predict how much will be raised by the fundraising. This concept is related to apathy bias or the bystander effect in behavioral economics. This does not happen in classical economic theory because individuals are not indifferent over who gets the cake, the stock, or the wage as long as someone gets it.

Direct Funding for EAs: A direct linkage between an individual who wishes to have their values promoted and another who attempts to promote these values in exchange for money.

This has been attempted within the Effective Altruist community by creating Gratipay and Patreon as donation portals for EAs. Although it is much cheaper per worker hour than donating to institutions - back of the envelope calculation during the EA Think Thank says between 2x to 3x cheaper within a country and up to 5x depending on currency exchange - this form of trade doesn’t have a large fraction of EA donation resources yet. Direct funding also permits funding for causes that are unknown or neglected within the EA community. If one single donor would like to sponsor an EA to research how Emulation Economics would disrupt the economy, and a single researcher is interested in doing this, direct donations between the two could guarantee this is done, whereas institutions or certificates would not. Direct Funding will be further discussed in a later post in the series.

Donation Swapping: Frequently there are tax or legal reasons for two donors with different interests and values to swap their donation targets. Because the market does not have absolute liquidity and zero viscosity, it is frequently advantageous for individuals to A and B to reach an agreement on how much to donate to causes 1 and 2, and then A who values 1 donates to 2 and B who values 2 donates to 1, because some market inefficiency makes that morally cheaper for them. This is a form of regulatory arbitrage.  

Moral Trade: ...as described by Toby Ord: If two parties have different moral views, then there is another type of trade that is possible: they can exchange goods or services such that both parties feel that the world is a better place, or that their moral obligations are better satisfied. We can call this moral trade. For instance, a person concerned with animal welfare might offer to donate to Oxfam if their friend, who is concerned with global poverty, agrees to abstain from eating meat for a year.

Moral trade is the philosophical underpinning on top of which moral economics can be built. If there was no moral trade, there would be substantially less reason for a science of moral economics. Moral Trade can happen almost irrespective of moral stance, which we can dub the Moral Trade Orthogonality Thesis. For any ranking of actions according to their moral permissibility or desirability, whether measured in (a)virtue,(b)ranking seen from a veil of ignorance, (c)utilons, (d)hedons, (e)sacredness or (f)accordance with universal reason, there might be ways in which trade could facilitate the attainment of moral good from the perspective of an individual who endorses that ranking scheme. The divergence in moral views between individuals greatly facilitates this trend.

Tragedy of Commonsense Morality: In Moral Tribes, Joshua Greene distinguishes the types of problems that are partially solved by our moral instincts and agreements (Me versus Us) from those which our moral instincts and system 1 morality are not equipped to solve (Us versus Them). He dubs this latter type the Tragedy of Commonsense morality. Throughout the book he makes a mixed empirical and philosophical case for utilizing system 2, manual mode morality when making decisions of the Us versus Them type, and trusting our senses more for Me versus Us type problems. He further advocates the usage of utilitarianism as a currency when solving problems of the Us versus Them type, though for space reasons I will not describe the many reasons for which he considers this desirable. It is worth noting that the book ends with a link to the Givewell website, indicating Greene's alignment with the use of Moral Trade as strategy to generate morally desirable outcomes.  

Acausal Trade: Acausal trade is trade which doesn’t involve (relevant) causal contact between the trading parties. If I assume there is an altruist in India who would prefer that I don’t eat beef and she assumes there is an altruist in the US who would prefer that she alleviates the suffering of five poor people in her city, we can make a Moral Acausal Trade, creating a world that is best for both of us without ever interacting: I eat less beef and she helps those five people in a way I couldn’t.