
Random computer simulation produces wealth distribution similar to reality - sprucely
https://www.technologyreview.com/s/610395/if-youre-so-smart-why-arent-you-rich-turns-out-its-just-chance/
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luckydude
The reason I go by luckydude is my acknowledgement that me getting somewhat
wealthy is in part pure chance.

I used to think I made my own luck, it was the groundwork I did that lead to
Larry and Sergey wanting to hire me, it was the work I did in creating my own
company, etc. I thought it was all me.

And I still believe that I had to do all the things to get some wealth but
I've watched much more talented people do all the right things and get nowhere
(and I've watch far less talented people get quite wealthy).

There is an element of luck, you have to do your part but you can do your part
and never be at the right place at the right time. I think that's the part
that is luck, you can't control what the rest of the world is doing and unless
you can predict the future, it's luck.

Signed,

luckydude, retired at 54.

~~~
ams6110
The Louis Pasteur quote that summarizes your observation is "chance favors the
prepared mind."

Of course chance plays a role in almost anything, but if you don't do the
work, you won't be prepared to take advantage of good fortune when it happens.

~~~
luckydude
I've never heard that quote before but it perfectly sums it up. Thanks.

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tlb
The study does not demonstrate what the headline claims.

The study shows that a simulation where randomness plays a major role can
produce similar wealth distribution to what's observed in the world. But that
doesn't rule out a more deterministic mechanism.

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vannevar
True. But by virtue of Occam's Razor, we should prefer the random explanation,
which doesn't require any deterministic rules.

If I walk into my kitchen and see a broken egg on the floor, it _could_ have
been left by a wayward chicken. But the simpler explanation is that my spouse
broke an egg from the refrigerator. If I prove that my spouse was home and up
before me this morning, I don't really need to disprove the chicken theory to
reasonably believe the simpler explanation.

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fatjokes
I thought it was established that it wasn't chance, that it was basically
family wealth? I.e., your family is rich, therefore you can afford to take
risks and fail, therefore you're more likely to make it big.

~~~
smt88
I consider family wealth to be chance as well. You don't choose which family
you're born into, after all.

~~~
nybble41
_You don 't choose which family you're born into, after all._

 _You_ couldn't have been born into any other family—a child born into a
different family would be a different person entirely. Is it still chance when
there is only one possible outcome?

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throwaway1748
It depends on how one define's 'rich', but if you go by the metric of having
$1MM+ in the bank, it strikes me there are plenty of opportunities to get
there that aren't pure chance.

The most obvious is to join a high-growth startup, particularly after the
initial period of high risk. An example of this would be to join Google in the
early 2000's, Facebook from 2007 to 2012, Stripe from 2012 to 2014, Uber from
2012 to 2014, etc etc. Today those companies would probably be the ones on
this Breakout List, plus a few others like Coinbase and Robinhood:
[https://breakoutlist.com/](https://breakoutlist.com/)

Join one of those companies as a software engineer and there's a very good
chance you'll make decent money. You don't have to be that lucky or
clairvoyant to identify these opportunities. This current cultural phenomenon
of explaining all success as either the result of luck or immoral behavior is
seriously troubling...

edit: would appreciate a discussion here rather than just being down-voted.

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ams6110
The most obvious and reliable way to get $1MM in the bank is to work, live
frugally, and invest savings for about 40 years.

~~~
zimpenfish
You forgot "...and never have anything go wrong".

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IanDrake
You can’t win if you don’t play the game. The more you play, the better your
odds.

Sure, you can play often and hard and still lose. It’s even possible to play
once, not do much, and win.

The probability of those outcome are vastly different.

Don’t play = 0% chance of winning.

Play once and don’t try hard = .000001% chance of winning.

Play hard and often = 15% chance of winning, with a 80% chance of coming in
the top 10%.

*figures are made up, but logically realistic.

~~~
WingH
There is an opportunity cost in playing though. There might be a 10% chance of
$1 million but what if it required giving up $100,000 in opportunity costs?

~~~
IanDrake
So true. I wouldn’t argue against your point, especially when you’re talking
about straight dollars.

I was trying to be more general though. Forget money, think effort.

For almost $0 dollars there is a ton of opportunity out there. Let’s just take
something we know, tech.

For effectively $0 you can learn everything there is to know about coding.

You could go to the library, get one book about html, and try being a web
developer in two weeks. That’s probably not going to go well, but not because
you’re unlucky.

Or, you could spend every waking moment consuming fundamentals of programming,
read everything, forums, blog post, write tons of sample apps, contribute to
open source and become a bad ass programmer. Chance of success is very high.

That is not about luck.

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nopinsight
Luck does play a role in life, but clearly it is not the entire story.

The simulation in the article does NOT explain why five of the most valuable
public companies on earth, Apple, Google, Amazon, Microsoft, and Facebook, are
all cofounded by people with IQ and possibly work ethics 3-4+ SDs above
population means. (Check out the biographies including the academic records of
the cofounders if you have doubts about this statement.)

Many mechanisms can exhibit the same broad effect. Showing that a simulation
reproduces _one_ phenomenon of the real world falls far short of showing that
it resembles the real mechanism in any substantive way.

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wfebi72to
All those five company cofounders depended for their success on algorithms
orginated by the likes of Donald Knuth, who is as hardworking and probably
smarter than them, but they are exponentially richer

~~~
nopinsight
Knuth never wanted to run a business (to my knowledge). Ambition and desire
are necessary though not sufficient factors for business success.

Knuth did achieve immortality through his magnum opus, which is another kind
of major success.

I'm just arguing that wealth distribution is _not_ random in the real world,
not justifying whether it should be one way or another.

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sharemywin
while wealth distribution follows a power law,

the distribution of human skills generally follows a normal distribution that
is symmetric about an average value. For example, intelligence, as measured by
IQ tests, follows this pattern. Average IQ is 100,

but nobody has an IQ of 1,000 or 10,000.

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meri_dian
So this obscenely simplistic model produces a certain result and it's
interpreted as "confirming" that wealth comes from pure chance? Silliness.

Many holes we could poke in this one. First, there shouldn't just be one
talent parameter. There should be many different types of talent, each of
which contribute in their own unique way to a probability of wealth
accumulation over a lifetime.

Most wealthy and successful people I've met are intelligent, confident and
likeable people.

~~~
tabeth
> Most wealthy and successful people I've met are intelligent, confident and
> likeable people.

This is the wrong metric. Are most intelligent, confident and likeable people
wealthy?

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perl4ever
To be at the far right of the distribution for any measure of achievement, you
generally have to (a) start on "third base", (b) devote your life to learning
and practicing from an early age, (c) have far more innate talent than most,
(d) have the right personality, with irrational faith in yourself and drive,
and (d) have far more luck than most people.

I think it's pointless to argue about whether people deserve great success,
because whatever attributes you consider "deserved" vs "not deserved", the
most successful must have _all_ of them - otherwise someone else would take
their place.

