2 min read

Effective Altruism: A Model for Making High-Impact Decisions

Effective altruism (EA) is not just a philosophy or a movement; it's a decision-making framework. It's a guide for individuals to ensure that their contributions—whether in time, money, or effort—have the maximum positive impact on the world. The principles underlying effective altruism can be applied in a variety of settings, and they share some fundamental similarities with the concept of expected value—a probabilistic decision-making tool.

Understanding Effective Altruism

At its core, effective altruism is about using evidence and reasoning to determine how to do the most good. It's about asking challenging questions: How can we use our resources to help others the most? Which causes, organizations, or interventions offer the highest expected value in terms of benefits to humanity?

The Expected Value Approach

The thinking process behind effective altruism is eerily similar to that of the expected value (EV) in decision-making. In the realm of EV, we weigh the potential outcomes of different actions against their probabilities, aiming to select the action with the highest weighted average benefit. Similarly, effective altruists evaluate different charitable causes and interventions based on the expected outcomes, emphasizing evidence, effectiveness, and scalability.

During my time at FTX, a company where the ethos of effective altruism was deeply ingrained, I saw firsthand how these principles were put into action. The company didn't just donate to causes; it deliberated on which causes could yield the most significant positive impact per dollar or hour invested.

Applying EA Thinking in Everyday Life

The principles of effective altruism can be applied far beyond charitable donations or philanthropic decisions. Here are some ways to integrate EA thinking into daily life:

  1. Career Choices: Rather than just following passion, consider how your career can create a significant positive difference. Some careers might offer direct impact, while others provide the means to support high-impact causes.
  2. Purchasing Decisions: Think about the broader impact of your purchases. Supporting ethically-produced goods or sustainable businesses can be a way to practice EA principles in daily consumption.
  3. Learning and Advocacy: Invest time in understanding global challenges. The more you know, the better equipped you'll be to advocate for meaningful change.

Personal Reflections on EA

I view effective altruism as a beacon for those who wish to make a difference. It pushes us to think critically, challenge our biases, and strive for maximum impact. The concept isn't about donating the most money but about ensuring every action we take, whether in philanthropy or in life, holds genuine, positive significance.

Drawing parallels between EA and expected value has enriched my understanding of both. Just as we use EV to make informed decisions in trading or business, effective altruism offers a structured approach to philanthropy and life choices. It’s a lens to view the world, ensuring our efforts aren't just good, but the best they can be.

In the words of the Bhagavad Gita, "Karmanye vadhikaraste Ma Phaleshu Kadachana" — our duty is to perform actions, but we should not be attached to the outcomes. This ancient wisdom aligns beautifully with the principles of effective altruism. It reminds us that while we should strive for the best outcomes, we must also find contentment in knowing we've made our decisions with intention and care.

In conclusion, effective altruism is not just about charity. It's a mindset, a methodology, and perhaps most importantly, a call to action. By integrating its principles into our lives, we can ensure that our actions, big or small, always aim for the most significant positive impact.