Experiments With Liberal Radicalism
A crowdfund matching mechanism for public goods, like open source
A recent paper entitled Liberal Radicalism proposes a mechanism to fund public goods in a new and unique fashion. Written by Vitalik Buterin, Zoë Hitzig, and Glen Weyl, the paper introduces a mechanism called Capital-constrained Liberal Radicalism (‘CLR’) which I’ll explain in greater detail below.
A summary of the paper (and the CLR mechanism) from the paper is as follows.
We propose a design for philanthropic or publicly-funded seeding to allow (near) optimal provision of a decentralized, self-organizing ecosystem of public goods.
Individuals make public goods contributions to projects of value to them. The amount received by the project is (proportional to) the square of the sum of the square roots of contributions received.
Soon, we’ll dive into ‘the square of the sum of the square roots’, which is the crux of Liberal Radicalism. It’s worth taking time to explain. Before that, we’ll start with the two basic components of the mechanism: crowdfunding and matching donations.
- Crowdfunding: Individuals crowdfund donations towards public goods (for example: open source software).
- Matching donations: These individual contributions are ‘matched’ or ‘topped-off’ by a government, grants program, or private philanthropist
Crowdfunding, with a matching function. That’s it. The philosophical undertones here come from Kantian ethics — specifically, the categorical imperative.
Act only according to that maxim whereby you can, at the same time, it should become a universal law.
By making an individual donation, you contribute to a public good. This funding is guaranteed to be met by matching funding, widening the reach of your donation. What you do becomes “law.”
By donating with one to one matching, you increase the power of any single donation in direct proportion to the size of the donation, making people more likely to feel like their money is having an impact. This is the premise of “Donate $1, [Company X] will match $1” programs.
To read the full story visit: https://gitcoin.co/blog/experiments-with-liberal-radicalism/
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