EA - Relative Value Functions: A Flexible New Format for Value Estimation by Ozzie Gooen

Link to original articleWelcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: Relative Value Functions: A Flexible New Format for Value Estimation, published by Ozzie Gooen on May 18, 2023 on The Effective Altruism Forum.SummaryQuantifying value in a meaningful way is one of the most important yet challenging tasks for improving decision-making. Traditional approaches rely on standardized value units, but these falter when options differ widely or lack an obvious shared metric. We propose an alternative called relative value functions that uses programming functions to value relationships rather than absolute quantities. This method captures detailed information about correlations and uncertainties that standardized value units miss. More specifically, we put forward value ratio formats of univariate and multivariate forms.Relative value functions ultimately shine where single value units struggle: valuing diverse items in situations with high uncertainty. Their flexibility and elegance suit them well to collective estimation and forecasting. This makes them particularly well-suited to ambitious, large-scale valuation, like estimating large utility functions.While promising, relative value functions also pose challenges. They require specialized knowledge to develop and understand, and will require new forms of software infrastructure. Visualization techniques are needed to make their insights accessible, and training resources must be created to build modeling expertise.Writing programmatic relative value functions can be much easier than one might expect, given the right tools. We show some examples using Squiggle, a programming language for estimation.We at QURI are currently building software to make relative value estimation usable, and we expect to share some of this shortly. We of course also very much encourage others to try other setups as well.Ultimately, if we aim to eventually generate estimates of things like:The total value of all effective altruist projects;The value of 100,000 potential personal and organizational interventions; orThe value of each political bill under consideration in the United States;then the use of relative value assessments may be crucial.Presentation & DemoI gave a recent presentation on relative values, as part of a longer presentation in our work at QURI. This features a short walk-through of an experimental app we're working on to express these values. The Relative Values part of the presentation is is from 22:25 to 35:59.This post gives a much more thorough description of this work than the presentation does, but the example in the presentation might make the rest of this make more sense.Challenges with Estimating Value with Standard UnitsThe standard way to measure the value of items is to come up with standardized units and measure the items in terms of these units.Many health measure benefits are estimated in QALYs or DALYsConsumer benefit has been measured in willingness to payLongtermist interventions have occasionally been measured in “Basis Points”, Microdooms and MicrotopiasRisky activities can be measured in MicromortsCOVID activities have been measured in MicroCOVIDsLet’s call these sorts of units “value units” as they are meant as approximations or proxies of value. Most of these (QALYs, Basis Points, Micromorts) can more formally be called summary measures, but we’ll stick to the term unit for simplicity.These sorts of units can be very useful, but they’re still infrequently used.QALYs and DALYS don’t have many trusted and aggregated tables. Often there are specific estimates made in specific research papers, but there aren’t many long aggregated tables for public use.There are very few tables of personal intervention value estimates, like the net benefit of life choices.Very few business decisions are made with reference to clear units of value. For example, “Whi...