Epistemic status: 90% confident.

Inspiration: Arjun Narayan, Tyler Cowen.

The noblest charity is to prevent a man from accepting charity, and the best alms are to show and enable a man to dispense with alms.

Moses Maimonides.

Background

Effective Altruism (EA) is "a philosophy and social movement that applies evidence and reason to determine the most effective ways to improve the world." Along with the related organisation GiveWell, it often focuses on getting the most "bang for your buck" in charitable donations. Unfortunately, despite their stated aims, their actual charitable recommendations are generally wasteful, such as cash transfers to poor Africans. This leads to the obvious question - how can we do better?

Doing better

One of the positive aspects of EA theory is its attempt to widen the scope of altruism beyond the traditional. For instance, to take into account catastrophic risks, and the far future. However, altruism often produces a far-mode bias where intentions matter above results. This can be a particular problem for EA - for example, it is very hard to get evidence about how we are affecting the far future. An effective method needs to rely on a tight feedback loop between action and results, so that continual updates are possible. At the extreme, Far Mode operates in a manner where no updating on results takes place at all. However, it is also important that those results are of significant magnitude as to justify the effort. EA has mostly fallen into the latter trap - achieving measurable results, but which are of no greater consequence.

The population of sub-Saharan Africa is around 950 million people, and growing. They have been a prime target of aid for generations, but it remains the poorest region of the world. Providing cash transfers to them mostly merely raises consumption, rather than substantially raising productivity. A truly altruistic program would enable the people in these countries to generate their own wealth so that they no longer needed poverty - unconditional transfers, by contrast, is an idea so lazy even Bob Geldof could stumble on it. The only novel thing about the GiveWell program is that the transfers are in cash.

Unfortunately, no-one knows how to turn poor African countries into productive Western ones, short of colonization. The problem is emphatically not a shortage of capital, but rather low productivity, and the absence of effective institutions in which that capital can be deployed. Sadly, these conditions and institutions cannot simply be transplanted into those countries.

A greater charity

However, there do exist countries with high productivity, and effective institutions in which that capital can be deployed. That capital then raises world productivity. As F.A. Harper wrote:

Savings invested in privately owned economic tools of production amount to... the greatest economic charity of all.

That is because those tools increase the productivity of labour, and so raise output. The pie has grown. Moreover, the person who invests their portion of the pie into new capital is particularly altruistic, both because they are not taking a share themselves, and because they are making a particularly large contribution to future pies.

In the same way that using steel to build tanks means (on the margin) fewer cars and vice-versa, using craftsmen to build a new home means (on the margin) fewer factories and vice-versa. Investment in capital is foregone consumption. Moreover, you do not need to personally build those economic tools; rather, you can part-finance a range of those tools by investing in the stock market, or other financial mechanisms.

Now, it's true that little of that capital will be deployed in sub-Saharan Africa at present, due to the institutional problems already mentioned. Investing in these countries will likely lead to your capital being stolen or becoming unproductive - the same trap that prevents locals from advancing equally prevents foreign investors from doing so. However, if sub-Saharan Africa ever does fix its culture and institutions, then the availability of that capital will then serve to rapidly raise productivity and then living standards, much as is taking place in China. Moreover, by making the rest of the world richer, this increases the level of aid other countries could provide to sub-Saharan Africa in future, should this ever be judged desirable. It also serves to improve the emigration prospects of individuals within these countries.

Feedback

Another great benefit of capital investment is the sharp feedback mechanism. The market economy in general, and financial markets in particular, serve to redistribute capital from ineffective to effective ventures, and from ineffective to effective investors. As a result, it is no longer necessary to make direct (and expensive) measurements of standards of living in sub-Saharan Africa; as long as your investment fund is gaining in value, you can rest safe in the knowledge that its growth is contributing, in a small way, to future prosperity.

Commitment mechanisms

However, if investment in capital is foregone consumption, then consumption is foregone investment. If I invest in the stock market today (altruistic), then in ten years' time spend my profits on a bigger house (selfish), then some of the good is undone. So the true altruist will not merely create capital, he will make sure that capital will never get spent down. One good way of doing that would be to donate to an institution likely to hold onto its capital in perpetuity, and likely to grow that capital over time. Perhaps the best example of such an institution would be a richly-endowed private university, such as Harvard, which has existed for almost 400 years and is said to have an endowment of $32 billion.

John Paulson recently gave Harvard $400 million. Unfortunately, this meant he came in for a torrent of criticism from people claiming he should have given the money to poor Africans, etc. I hope to see Effective Altruists defending him, as he has clearly followed through on their concepts in the finest way.

Further thoughts and alternatives

• Some people say that we are currently going through a "savings glut" in which capital is less productive than previously thought. In this case, it may be that Effective Altruists should focus on funding (and becoming!) successful entrepreneurs in different spaces.
• I am sympathetic to the Thielian critique that innovation is being steadily stifled by hostile forces. I view the past 50 years, and the foreseeable future, as a race between technology and regulation, which technology is by no means certain to win. It may be that Effective Altruists should focus on political activity, to defend and expand economic liberty where it exists - this is currently the focus of my altruism.
• However, government is not the enemy; rather, the enemy is the cultural beliefs and conditions that create a demand for the destruction of economic liberty. To the extent this critique, it may be that Effective Altruists should focus on promoting a pro-innovation and pro-liberty mindset; for example, through movies and novels.

Conclusion

What do you think about these pairs of statements?

1. People's misfortunes result from the mistakes they make
2. Many of the unhappy things in people's lives are partly due to bad luck

1. In the long run, people get the respect they deserve in this world.
2. Unfortunately, an individual's worth often passes unrecognized no matter how hard he tries.

1. Becoming a success is a matter of hard work; luck has little or nothing to do with it.
2. Getting a good job mainly depends on being in the right place at the right time.

They have a similar theme: the first statement suggests that an outcome (misfortune, respect, or a good job) for a person are the result of their own action or volition. The second assigns the outcome to some external factor like bad luck.(1)

People who tend to think their own attitudes or efforts can control what happens to them are said to have an internal locus of control, those who don't, an external locus of control. (Call them 'internals' and 'externals' for short).

Internals seem to do better at life, pace obvious confounding: maybe instead of internals doing better by virtue of their internal locus of control, being successful inclines you to attribute success internal factors and so become more internal, and vice versa if you fail.(2) If you don't think the relationship is wholly confounded, then there is some prudential benefit for becoming more internal.

Yet internal versus external is not just a matter of taste, but a factual claim about the world. Do people, in general, get what their actions deserve, or is it generally thanks to matters outside their control?

Why the external view is right

Here are some reasons in favour of an external view:(3)

1. Global income inequality is marked (e.g. someone in the bottom 10% of the US population by income is still richer than two thirds of the population - more here). The main predictor of your income is country of birth, it is thought to explain around 60% of the variance: not only more important than any other factor, but more important than all other factors put together.
2. Of course, the 'remaining' 40% might not be solely internal factors either. Another external factor we could put in would be parental class. Include that, and the two factors explain 80% of variance in income.
3. Even conditional on being born in the right country (and to the right class), success may still not be a matter of personal volition. One robust predictor of success (grades in school, job performance, income, and so on) is IQ. The precise determinants of IQ remain controversial, it is known to be highly heritable, and the 'non-genetic' factors of IQ proposed (early childhood environment, intra-uterine environment, etc.) are similarly outside one's locus of control.

On cursory examination the contours of how our lives are turned out are set by factors outside our control, merely by where we are born and who our parents are. Even after this we know various predictors, similarly outside (or mostly outside) of our control, that exert their effects on how our lives turn out: IQ is one, but we could throw in personality traits, mental health, height, attractiveness, etc.

So the answer to 'What determined how I turned out, compared to everyone else on the planet?', the answer surely has to by primarily about external factors, and our internal drive or will is relegated a long way down the list. Even if we want to look at narrower questions, like "What has made me turn out the way I am, versus all the other people who were likewise born in rich countries in comfortable circumstances?" It is still unclear whether the locus of control resides within our will: perhaps a combination of our IQ, height, gender, race, risk of mental illness and so on will still do the bulk of the explanatory work.(4)

Bringing the true and the prudentially rational together again

If it is the case that folks with an internal locus of control succeed more, yet also the external view being generally closer to the truth of the matter, this is unfortunate. What is true and what is prudentially rational seem to be diverging, such that it might be in your interests not to know about the evidence in support of an external locus of control view, as deluding yourself about an internal locus of control view would lead to your greater success.

Yet it is generally better not to believe falsehoods. Further, the internal view may have some costs. One possibility is fueling a just world fallacy: if one thinks that outcomes are generally internally controlled, then a corollary is when bad things happen to someone or they fail at something, it was primarily their fault rather than them being a victim of circumstance.

So what next? Perhaps the right view is to say that: although most important things are outside our control, not everything is. Insofar as we do the best with what things we can control, we make our lives go better. And the scope of internal factors - albeit conditional on being a rich westerner etc. - may be quite large: it might determine whether you get through medical school, publish a paper, or put in enough work to do justice to your talents. All are worth doing.

Acknowledgements

Inspired by Amanda MacAskill's remarks, and in partial response of Peter McIntyre. Neither are responsible for what I've written, and the former's agreement or the latter's disagreement with this post shouldn't be assumed.

1) Some ground-clearing: free will can begin to loom large here - after all, maybe my actions are just a result of my brain's particular physical state, and my brain's particular physical state at t depends on it's state at t-1, and so on and so forth all the way to the big bang. If so, there is no 'internal willer' for my internal locus of control to reside.

However, even if that is so, we can parse things in a compatibilist way: 'internal' factors are those which my choices can affect; external factors are those which my choices cannot affect. "Time spent training" is an internal factor as to how fast I can run, as (borrowing Hume), if I wanted to spend more time training, I could spend more time training, and vice versa. In contrast, "Hemiparesis secondary to birth injury" is an external factor, as I had no control over whether it happened to me, and no means of reversing it now. So the first set of answers imply support for the results of our choices being more important; whilst the second set assign more weight to things 'outside our control'.

2) In fairness, there's a pretty good story as to why there should be 'forward action': in the cases where outcome is a mix of 'luck' factors (which are a given to anyone), and 'volitional ones' (which are malleable), people inclined to think the internal ones matter a lot will work hard at them, and so will do better when this is mixed in with the external determinants.

3) This ignores edge cases where we can clearly see the external factors dominate - e.g. getting childhood leukaemia, getting struck by lightning etc. - I guess sensible proponents of an internal locus of control would say that there will be cases like this, but for most people, in most cases, their destiny is in their hands. Hence I focus on population level factors.

4) Ironically, one may wonder to what extent having an internal versus external view is itself an external factor.

I want to make a list of companies that are affiliated with transhumanism. I'm looking for companies pursuing transhumanist goals (ex: VR, gene sequencing) or built by transhumanists themselves (ex: arguably Elon Musk).

What places do you know of? Which look like cool places to work? Extra points if you've worked there.

Aside from my personal reasons for seeking those companies (internships, research for future projects), I think a list of transhumanist companies will be a good thing to keep around for other future endeavors.

Also: The Seasteading Institute, SIAI, BioCurious, etc are all incredibly cool, but I'm not looking for non-profits. 

My list so far:

• The obvious ones to start with are anything connected with Peter Thiel and the Founders' Fund.
• Tesla Motors and SpaceX are projects of Elon Musk. Tesla Motors is making electric cars and SpaceX is chasing private space flight.
• Luke Nosek, who worked on PayPal with Elon Musk, has started a company called Halcyon Molecular and is also connected with Pathway Genomics. The first does gene sequencing, the second offers personal genetics reports.
• Novamente LLC is working on "intelligent virtual agents for virtual worlds, computer games, and simulations." Ben Goertzel leads it.

What am I missing?