Astral Codex Ten

Instacart

7 min read

Instacart

Article

Instacart is a recurring organization in the Astral Codex Ten archive, appearing 2 times across 2 issues between January 04, 2024 and January 11, 2024. The archive places it in contexts such as “Consider some company. I’m going to pick Instacart, because I like it and use it often. Instacart is like Uber for groceries”; “Instacart employs 10,000 full-time employees and 600,000 gig workers”; “Instacart is self-sustaining”. It most often appears alongside ACX Grants, capitalism, Charter Cities Institute.

Metadata

  • Category: Organizations
  • Mention count: 2
  • Issue count: 2
  • First seen: January 04, 2024
  • Last seen: January 11, 2024

Appears In

Source Context

Recovered passages from the original issue text. When the raw archive preserved outbound links inside the source passage, they are listed directly under the quote.

Does Capitalism Beat Charity?
January 04, 2024 · Original source
Do something like donating to charity, but the donation should go to charities that promote capitalism somehow, or be an investment in companies doing charitable things (impact investing) I agree that overall capitalism has produced more good things than charity. But when I try to think at the margin, in Near Mode, I can’t make this argument hang together. Here’s my basic objection: Consider some company. I’m going to pick Instacart, because I like it and use it often. Instacart is like Uber for groceries. It delivers them to your house, so you don’t have to go shopping. It’s great if you’re lazy, or if you’re sick and don’t want to leave the house. I’m not putting my finger on the scales by choosing Instacart here. Instacart is great. Instacart makes yearly profit of $500 million, yearly revenue of $2.5 billion, and has 10 million yearly customers (who I guess pay $250 each per year?) and a market cap of $10 billion. For complicated reasons I’ll relegate to a footnote1, I’m going to summarize the deal that Capitalism offers by allowing Instacart to exist to “For $1 million, you can give 2,000 people a great deal on grocery delivery”. Compare this to a good charity, like GiveWell’s pick Dispensers For Safe Water. If I understand their claim right, per $1 million they can give 50,000 people clean water for ten years, which would probably save about 1,500 lives. So which is a better use of $1 million? Give it to Capitalism, and give 2,000 people a great deal on grocery delivery? Or give it to Charity, and give 50,000 people clean water and save 1,500 lives? Even without being able to exactly quantify the value of grocery delivery deals vs. clean water, common-sensically Charity wins on first-order effects. So the argument for Capitalism must go through something about second-order effects. But what are these? I can think of a few possibilities: Job creation: Along with helping its customers, Instacart employs 10,000 full-time employees and 600,000 gig workers, so our $1 million investment might produce a few dozen jobs. That still doesn’t seem to counterbalance the advantage of Charity. But also (and I admit I have trouble thinking about this), it doesn’t seem obvious that Instacart “causes” jobs. Suppose Instacart had never been founded. Then people would spend whatever money they now spend on Instacart on something else (let’s say booze and porn), which would also create jobs (for brewers, bartenders, and porn stars). There’s no particular reason to think spending the money on Instacart creates more jobs than spending it on those other things would. So how many jobs does Instacart create over replacement? I’m not sure but I think it must be much less than the official number of employees.
Inline links: 1
Job creation: Along with helping its customers, Instacart employs 10,000 full-time employees and 600,000 gig workers, so our $1 million investment might produce a few dozen jobs. That still doesn’t seem to counterbalance the advantage of Charity. But also (and I admit I have trouble thinking about this), it doesn’t seem obvious that Instacart “causes” jobs. Suppose Instacart had never been founded. Then people would spend whatever money they now spend on Instacart on something else (let’s say booze and porn), which would also create jobs (for brewers, bartenders, and porn stars). There’s no particular reason to think spending the money on Instacart creates more jobs than spending it on those other things would. So how many jobs does Instacart create over replacement? I’m not sure but I think it must be much less than the official number of employees.
Replaceability: I actually think this one favors Charity. If nobody had invested in Instacart, surely “grocery delivery” wouldn’t remain an unfilled niche forever. But there’s lots of room for more money in Dispensers For Safe Water, and I think any money you don’t send to them simply won’t be spent on water dispensing.
Highlights From The Comments On Capitalism & Charity
January 11, 2024 · Original source
He never really addresses why plugging the cash into an index like the S&P 500 isn't a better use of funds than GiveWell's recommended charity. He chooses Instacart as his exemplar of capitalism, but then concludes that investing $1M in Instacart means "you can give 2,000 people a great deal on grocery delivery." But the whole point of investing is that it isn't one-and-done, that instead it grows exponentially over the long term, building wealth in the form of new and better companies which provide products, services, innovation and technology that are responsible for basically all of the good things you see on Steven Pinker's up-and-to-the-right charts illustrating the improvement of the human condition over time. These are the things that, if all goes well, will eventually lift humanity to the heavens, slay the demons (disease, death, etc.) that have haunted us forever, and awaken the dead matter of the cosmos into flourishing sentience.
Second, I care a lot about marginal utility of money. I think a (consumption) dollar goes much further in the developing world than the developed world. If you invest in high-growth companies, it may create more total wealth, but most of that wealth stays in the developed world. If you donate to charity, you will create less numerical wealth, but it will go to people who need it more. Which matters more? This is what the Instacart vs. clean water example was meant to provide intuitions for.
Third, how does company wealth compound vs. philanthropic “wealth”? If you give your money to a company, they’ll expand operations and grow at some rate (on average the market rate of return). If you spend your money curing tropical diseases, then some people will survive, and those people will build wealth / do labor / grow the economy (also you’ll save money that would otherwise have been spent treating those diseases). As I said on the subreddit, whatever else is bad about an 18 year old dying, you've lost ~50 years worth of productive labor that you invested eighteen years building up. Once you consider how much human effort it took raise and educate 2,000 eighteen-year-olds, and how much you can get done with a 2,000-person labor force, then letting those 2,000 people die starts to feel like a giant economic waste even in addition to the humanitarian cost (not to mention the amount of money saved by not building hospitals to treat the diseases that would otherwise have killed them). Probably those 2,000 people don't create more compounding wealth than an investment of the same amount of money into Instacart would, but I think the diminishing marginal utility of money case makes it likely that they produce more utility-adjusted wealth.