So how does economists feel about effective altruism?
While economists like efficiency, they are less sure about altruism: For one thing, does it even exist? Or is it just long-run selfishness in the form of reciprocity, signaling or reputational concern? If one or more of these explanations of altruism are relevant, it is far from obvious what that means for effective altruism. Regardless of which, is altruism necessarily desirable?
On the other hand: If effective altruism simply means "doing good better", one could argue that this is exactly what welfare economics has been analyzing for decades: take a normative criterion (such as utility maximization, perhaps with some distributional restrictions) and maximize it subject to resource constraints.
To avoid having to define what "doing good" entails, economists often use less controversial normative criteria, such as the Pareto criterion or the Kaldor-Hick criterion, and look for win-win situations. But if you are doing good for someone else and for yourself at the same time, it is hardly altruism, is it?
Somewhat along these lines, I've been working on a paper that argues that under broad circumstances, investing is doing more good than giving.*
What is needed is a cultural change so that people become proud of how they give and not just how much they give.
I am tentatively leaning towards the conclusion that it would be even better if we take pride in how we trade with and invest in poor countries, rather than how we give.
Perhaps the effective altruism movement should be called the effective world improvement movement?
*The paper is called "Adam Smith vs Jeffrey Sachs: Can Social Norms in Rich Countries Explain Why Other Countries Remain Poor?" and was presented in Stockholm in june
(no pdf exist yet). It is currently under revision, and a revised version will be presented at the SEA meetings in New Orleans