3 ms·

Doesn't this argument justify stopping ANY spending that is not R&D? For example, a dollar spent on healthcare keeping a chronically sick person alive is a dol

Doesn't this argument justify stopping ANY spending that is not R&D? For example, a dollar spent on healthcare keeping a chronically sick person alive is a dollar that could instead have improved the welfare of all future generations. Is there a version of this argument that doesn't throw grandpa under the bus?

wyager 5y ago
Yes, for any given time preference there exist capital allocations with equilibrated marginal returns between consumption vs capital investment. I'd argue we're not in one of those allocations, and if we are it must be associated with an extremely high time preference, and UBI would make it worse.
- xyzzy123 5y ago
  I agree your statement is logically correct from a utilitarian standpoint. There's a little bit of "spherical cow" involved though. A more detailed model would recognise that R&D spend is not pure investment, and UBI would not be pure consumption. Whether non-zero UBI today would good policy or not depends on an enormous number of facts about the world that I think it would be very difficult to come to an agreement on. For example, at what level diminishing returns from R&D spending kick in, and whether UBI apart from increasing immediate welfare has any compounding benefits (human capital, civil cohesion, education, business starts, citizen science) vs mostly benefiting landlords and netflix. I expect our priors are quite different.
  - wyager 5y ago
    I think we mostly agree except on our level of optimism about how UBI will realistically be spent. I would argue that my pessimism is extremely well-founded because present material conditions are an extremely strong (if noisy) indicator of an individual's capital allocation efficiency. If someone is in a position to start a successful business, or engage in productive citizen science, they are overwhelmingly less likely to be a net beneficiary of any welfare scheme. I think there is a pessimistic utilitarian argument for welfare just because people have concave/risk-averse utility functions (of wealth) and it's possible that the dollar-cheap utility gains for people close to zero might outweigh the higher-order costs, but it strikes me as somewhat fantastical to imagine that there might be meaningful financial gains from a welfare scheme, because people with more welfare money might use the money to read a book or start a successful business or something.
    - xyzzy123 5y ago
      You make good points here, thanks. It was interesting to think about rate of increase of utility over time, it did throw new light on the idea of UBI for me.
      - wyager 5y ago
        You as well. You make good observations about some of the possible higher-order upsides of UBI that are easy to gloss over. I think both of us are at the very least approaching this on a sound ontological basis, even if there's a lot of room for quantitative uncertainty.

wyager 5y ago

Yes, for any given time preference there exist capital allocations with equilibrated marginal returns between consumption vs capital investment. I'd argue we're not in one of those allocations, and if we are it must be associated with an extremely high time preference, and UBI would make it worse.

xyzzy123 5y ago
I agree your statement is logically correct from a utilitarian standpoint. There's a little bit of "spherical cow" involved though. A more detailed model would recognise that R&D spend is not pure investment, and UBI would not be pure consumption. Whether non-zero UBI today would good policy or not depends on an enormous number of facts about the world that I think it would be very difficult to come to an agreement on. For example, at what level diminishing returns from R&D spending kick in, and whether UBI apart from increasing immediate welfare has any compounding benefits (human capital, civil cohesion, education, business starts, citizen science) vs mostly benefiting landlords and netflix. I expect our priors are quite different.
- wyager 5y ago
  I think we mostly agree except on our level of optimism about how UBI will realistically be spent. I would argue that my pessimism is extremely well-founded because present material conditions are an extremely strong (if noisy) indicator of an individual's capital allocation efficiency. If someone is in a position to start a successful business, or engage in productive citizen science, they are overwhelmingly less likely to be a net beneficiary of any welfare scheme. I think there is a pessimistic utilitarian argument for welfare just because people have concave/risk-averse utility functions (of wealth) and it's possible that the dollar-cheap utility gains for people close to zero might outweigh the higher-order costs, but it strikes me as somewhat fantastical to imagine that there might be meaningful financial gains from a welfare scheme, because people with more welfare money might use the money to read a book or start a successful business or something.
  - xyzzy123 5y ago
    You make good points here, thanks. It was interesting to think about rate of increase of utility over time, it did throw new light on the idea of UBI for me.
    - wyager 5y ago
      You as well. You make good observations about some of the possible higher-order upsides of UBI that are easy to gloss over. I think both of us are at the very least approaching this on a sound ontological basis, even if there's a lot of room for quantitative uncertainty.