Talent vs. Luck: the role of randomness in success and failure(arxiv.org)
arxiv.org
Talent vs. Luck: the role of randomness in success and failure
https://arxiv.org/abs/1802.07068
59 comments
Previous discussion: https://news.ycombinator.com/item?id=16503235
This has interesting implications for organizational dynamics: the more you can allow people across the organization to innovate, rather than relying on promotion and formal recognition to pre-pick winners, the more likely the company will benefit from future luck. And it may be more valuable for a company to hire a bunch of people who are just "good enough" than one person who is a super-genius, because it makes it more likely the company will get lucky.
I always find it interesting how employers pay you for your labor, yet they implicitly also have an option on any significant innovation you produce. In a truly competitive labor market, employers would have to compensate for this option value (ie. employees who are more likely to have breakthroughs, as separate from any incremental project work).
This is a fascinating point. Perhaps the cleanest way to fairly treat your option value is to not compensate you in expectation, but to allow you to "sell" your idea internally when you have them. Employees could get a royalty, say, for a successful idea. Pricing the royalty is difficult, but it's still an interesting idea.
As I write, I realize this must have been tried somewhere. I know at one point Sandia Labs allowed employees to start spin-offs using tech developed there, but that's not quite the same.
As I write, I realize this must have been tried somewhere. I know at one point Sandia Labs allowed employees to start spin-offs using tech developed there, but that's not quite the same.
If you read this and think "luck is all that matters, how can I be successful?" the solution is proactively creating optionality.
Basically giving yourself the chance the get lucky.
Things like: putting your work online, meeting new people, living in a big city, not buying a house, etc.
Basically giving yourself the chance the get lucky.
Things like: putting your work online, meeting new people, living in a big city, not buying a house, etc.
If I can summarize,
"You miss 100% of the shots you don't take" - Wayne Gretzky - Michael Scott
"You miss 100% of the shots you don't take" - Wayne Gretzky - Michael Scott
You miss NaN of the shots you don't take
Working hard certainly doesn't guarantee success, however it defiantly makes you luckier and exposes you to more opportunity. I like Kevin Systrom summed it up (not word for word):
Everyone gets lucky at least once a week. You might find a dollar on the ground, you might meet someone, be somewhere, whatever. What sets you up for success is:
1. Are you alert enough to know you're getting lucky?
2. Are you talented enough to run with it once you get lucky?
3. Are you resilient enough to stick with it once it gets hard?
Everyone gets lucky at least once a week. You might find a dollar on the ground, you might meet someone, be somewhere, whatever. What sets you up for success is:
1. Are you alert enough to know you're getting lucky?
2. Are you talented enough to run with it once you get lucky?
3. Are you resilient enough to stick with it once it gets hard?
>not buying a house
How does this help with luck, exactly?
How does this help with luck, exactly?
Not buying a house may decrease mobility for some, especially single people. But folks who have spouses and/or kids tend to be more anchored to the community regardless of whether they rent. They have jobs and schools and friends that are hard to move away from.
Also, buying a house can be an opportunity itself. Although the new tax law makes it somewhat less tax-favored as an investment, it still offers the ability to escape capital gains taxation on up to $500k (married) of gains. There are other federal and state benefits that can make the overall purchase decision attractive.
So for some folks, yes a house can be an anchor. For other folks, they're already pretty much anchored, and the tax benefits can outweigh the downsides of incremental anchoring. Also, you can't get evicted...
Also, buying a house can be an opportunity itself. Although the new tax law makes it somewhat less tax-favored as an investment, it still offers the ability to escape capital gains taxation on up to $500k (married) of gains. There are other federal and state benefits that can make the overall purchase decision attractive.
So for some folks, yes a house can be an anchor. For other folks, they're already pretty much anchored, and the tax benefits can outweigh the downsides of incremental anchoring. Also, you can't get evicted...
> buying a house can be an opportunity itself. Although the new tax law makes it somewhat less tax-favored as an investment, it still offers the ability to escape capital gains taxation
This is what I was thinking. There's nothing stopping a person from moving and keeping the house and renting it out, often at a profit over mortgate+fees+repairs+etc.
This is what I was thinking. There's nothing stopping a person from moving and keeping the house and renting it out, often at a profit over mortgate+fees+repairs+etc.
I bought a house and moved out several months after purchasing it for health reasons. The house was an anchor, that I also feel held me back.
I had to take a number of jobs with higher pay, that weren't beneficial to my career. Almost every decision was can I pay for this house as well.
Outside of my special use case. It's an anchor point in your life. I like this job but it's further away from my house. I like this job but it's in another city. Etc.
I had to take a number of jobs with higher pay, that weren't beneficial to my career. Almost every decision was can I pay for this house as well.
Outside of my special use case. It's an anchor point in your life. I like this job but it's further away from my house. I like this job but it's in another city. Etc.
In another universe you bought a house in an area that had a housing bubble and the price appreciated by 100% in a couple of years. You sold your house and retired in Mexico working on fun side projects.
You lose optionality when you commit your capital to an illiquid investment. That is, you no longer have the option to spend money on things which may have a higher ROI. Any type of commitment loses optionality.
Update: this is a great podcast episode on using optionality to your advantage (http://investorfieldguide.com/wolfe/)
Update: this is a great podcast episode on using optionality to your advantage (http://investorfieldguide.com/wolfe/)
Being able to seize opportunities (that require relocation) when the chance comes, perhaps? A house can become a boat anchor in those instances.
Probably mobility, hence increased ability to seize opportunities as they present.
There's a saying I like: "The harder I work, the luckier I get."
If we're playing a statistics game, the best way to pull ahead is to create the most opportunities you can have to be lucky. By working hard, you are providing yourself with more opportunities to be lucky. You can still fail and get unlucky, but that's an unfortunate part of life. Though it is pretty unlikely that you'll flip 50 tails in a row.
Disclaimer: I don't suggest using this strategy at the slots, your odds are just not good enough.
If we're playing a statistics game, the best way to pull ahead is to create the most opportunities you can have to be lucky. By working hard, you are providing yourself with more opportunities to be lucky. You can still fail and get unlucky, but that's an unfortunate part of life. Though it is pretty unlikely that you'll flip 50 tails in a row.
Disclaimer: I don't suggest using this strategy at the slots, your odds are just not good enough.
There a famous song from an old Soviet movie.
The song called "If you don't have an aunt"
"If you have no home It won't be set on fire And your wife won't leave you for another If you don't, if you don't If you don't have any wife Don't have any wife....."
Original with English subtitles https://www.youtube.com/watch?v=50CV0C4ox-k
"If you have no home It won't be set on fire And your wife won't leave you for another If you don't, if you don't If you don't have any wife Don't have any wife....."
Original with English subtitles https://www.youtube.com/watch?v=50CV0C4ox-k
A bit of self-promotion. I wrote an essay about this. Perhaps it's worth reading for those interested in this thread: https://hackernoon.com/a-guide-for-getting-lucky-in-startups...
How can I be successful if I have no talent?
You are good at what you do frequently. If what you do frequently has low RoI in terms for satisfying your desires, you should stop doing it and do something else.
Everybody is good doing something.
I'd rather put it as everybody has the opportunity to develop their talents and skills.
A bit of a tangent but here's something I stumbled on recently:
Vox: A statistical analysis of luck vs skill in sports. They interview the author of The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing
https://www.youtube.com/watch?v=HNlgISa9Giw
I've been trying to get into hockey lately and I doubt It'll last because there seems to be too much randomness to it. I feel like I would enjoy it more were it 4-on-4. I think I would also enjoy it more if each side were given 1-2 free powerplays per period. Hockey fans in the youtube comments say that there's more parity in the NHL than other sports leagues and that's skewing the calculation for luck vs randomness.
http://www.cbc.ca/radio/the180/the-psychology-of-terror-a-fo...
Vox: A statistical analysis of luck vs skill in sports. They interview the author of The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing
https://www.youtube.com/watch?v=HNlgISa9Giw
I've been trying to get into hockey lately and I doubt It'll last because there seems to be too much randomness to it. I feel like I would enjoy it more were it 4-on-4. I think I would also enjoy it more if each side were given 1-2 free powerplays per period. Hockey fans in the youtube comments say that there's more parity in the NHL than other sports leagues and that's skewing the calculation for luck vs randomness.
http://www.cbc.ca/radio/the180/the-psychology-of-terror-a-fo...
I remember Nassim Taleb wrote a paper with a similar hypothesis a few years ago. If I recall correctly it was about why smart people shouldn't go into trading: the role of luck is so great that even if you're one of the most skilled traders in the world you'll probably be outdone by someone less skilled but much luckier.
It makes you wonder though: where does luck matter least? Probably in something like a trade that you turn into a business. There you get enough customers that the effects of luck probably cancel out over time.
It makes you wonder though: where does luck matter least? Probably in something like a trade that you turn into a business. There you get enough customers that the effects of luck probably cancel out over time.
In his inspiring book "How to Fail at Almost Everything and Still Win Big", Scott Adams places much emphasis on the seeming randomness of luck. In describing his approach to success, he says "I pursued a conscious strategy of managing my opportunities in a way that would make it easier for luck to find me." His strategy includes focusing on systems rather than goals, and developing moderate skills in multiple areas. It's a very good read.
www.amazon.com/How-Fail-Almost-Everything-Still/dp/1591846
www.amazon.com/How-Fail-Almost-Everything-Still/dp/1591846
I think being smart or being hardworking can have normal distribution. But being smart and hardworking not. Introduction of paper states that qualities are distributed normally but they do not say anything about combinations.
Though I do not underestimate role of luck because luck can change outcomes of people in a huge way. Still you get lottery winners ending up badly. You still get top athletes ending up badly because they did well on one type of talent, but other types of talents like staying away from drugs not.
So as armchair philosopher/sociologist I believe that combinations of talents are more important than luck. If you have strong combination it saves you from bad luck, and helps get a lot more from good luck.
Though I do not underestimate role of luck because luck can change outcomes of people in a huge way. Still you get lottery winners ending up badly. You still get top athletes ending up badly because they did well on one type of talent, but other types of talents like staying away from drugs not.
So as armchair philosopher/sociologist I believe that combinations of talents are more important than luck. If you have strong combination it saves you from bad luck, and helps get a lot more from good luck.
I never had financial success without being lucky. Without luck my talent is not worth a dime.
Interesting. If I read this correctly, they chose to let talent affect lucky events but not unlucky events. I wonder what the rationale is for that and if it changes the results significantly to allow for probabilistically avoiding unlucky events.
> they chose to let talent affect lucky events but not unlucky events
Could you explain that a bit more please? The paper says, "We propose a model... of people influenced by lucky or unlucky random events." So unlucky events are being considered too. But it's possible that I'm not understanding what you mean.
Could you explain that a bit more please? The paper says, "We propose a model... of people influenced by lucky or unlucky random events." So unlucky events are being considered too. But it's possible that I'm not understanding what you mean.
From the paper:
2. A lucky event intercepts the position of agent Ak: this means that a lucky event has occurred during the last six month; as a consequence, agent Ak doubles her capital/success with a probability proportional to her talent Tk. It will be Ck(t) = 2Ck(t − 1) only if rand[0, 1] < Tk, i.e. if the agent is smart enough to profit from his/her luck.
3. An unlucky event intercepts the position of agent Ak: this means that an unlucky event has occurred during the last six month; as a consequence, agent Ak halves her capital/success, i.e. Ck(t) = Ck(t − 1)/2.
Note that the equation for lucky events includes talent, but unlucky events do not.
2. A lucky event intercepts the position of agent Ak: this means that a lucky event has occurred during the last six month; as a consequence, agent Ak doubles her capital/success with a probability proportional to her talent Tk. It will be Ck(t) = 2Ck(t − 1) only if rand[0, 1] < Tk, i.e. if the agent is smart enough to profit from his/her luck.
3. An unlucky event intercepts the position of agent Ak: this means that an unlucky event has occurred during the last six month; as a consequence, agent Ak halves her capital/success, i.e. Ck(t) = Ck(t − 1)/2.
Note that the equation for lucky events includes talent, but unlucky events do not.
>It is very well known that intelligence or talent exhibit a Gaussian distribution among the population
Why should we assume that intelligence in the total population is Gaussian distributed, even if you assume that you can measure 'intelligence'? A Gaussian distribution of a metric emerges solely for the reason that there is nothing else influencing the out come of the variables (no one way boundary transition conditions) and as a result, there is just a random, scattered cloud of noise around where the values are. Pareto distributions emerge when there's an influencing factor which forces a change (businesses collocating next to each other to reduce costs, people buying things from people/businesses they know) Given that there are are events/phenomenon that will clearly break independence of an intelligence result (child suffers head trauma, exposure to chemicals while in the womb, Malnutrition) I remain skeptical that 'intelligence' is Gaussian distributed.
Why should we assume that intelligence in the total population is Gaussian distributed, even if you assume that you can measure 'intelligence'? A Gaussian distribution of a metric emerges solely for the reason that there is nothing else influencing the out come of the variables (no one way boundary transition conditions) and as a result, there is just a random, scattered cloud of noise around where the values are. Pareto distributions emerge when there's an influencing factor which forces a change (businesses collocating next to each other to reduce costs, people buying things from people/businesses they know) Given that there are are events/phenomenon that will clearly break independence of an intelligence result (child suffers head trauma, exposure to chemicals while in the womb, Malnutrition) I remain skeptical that 'intelligence' is Gaussian distributed.
Intelligence cannot exhibit a Gaussian distribution, not unless you make certain assumptions about what intelligence is.
Is the OP's definition of intelligence limited to academic or intellectual intelligence? If so, that's the problem.
There just isn't a single kind of intelligence. Nor is intellectual intelligence superior. It's just unique, like other forms of intelligence.
Also, different people excel naturally in certain fields, or even when it comes to learning in certain fields, or learning through certain methods, such as through watching something happening, doing it practically, listening to an explanation, or even just reading about it, and so on.
Because of this, I'm skeptical that there's even an element of randomness. There isn't, not when you take into account all of the life circumstances that shape individuals and their ability to cultivate and make proper use of their innate skills and abilities.
Many people are hampered by society from ever discovering their true calling in life, so to speak, in various ways, whether it be bias towards intellectual intelligence, bias towards what suits the needs of our corporation-dominated society consumed by the need to work for money almost all the time just to survive, etc.
In a work-orientated society that takes up the majority of people's time, stress them out, etc, most people never get the chance to discover their talents, to cultivate them, etc.
Just a bit of unstructured rant, because it's early in the morning and I haven't yet had my coffee, but had to type this while it was still fresh. :/
Is the OP's definition of intelligence limited to academic or intellectual intelligence? If so, that's the problem.
There just isn't a single kind of intelligence. Nor is intellectual intelligence superior. It's just unique, like other forms of intelligence.
Also, different people excel naturally in certain fields, or even when it comes to learning in certain fields, or learning through certain methods, such as through watching something happening, doing it practically, listening to an explanation, or even just reading about it, and so on.
Because of this, I'm skeptical that there's even an element of randomness. There isn't, not when you take into account all of the life circumstances that shape individuals and their ability to cultivate and make proper use of their innate skills and abilities.
Many people are hampered by society from ever discovering their true calling in life, so to speak, in various ways, whether it be bias towards intellectual intelligence, bias towards what suits the needs of our corporation-dominated society consumed by the need to work for money almost all the time just to survive, etc.
In a work-orientated society that takes up the majority of people's time, stress them out, etc, most people never get the chance to discover their talents, to cultivate them, etc.
Just a bit of unstructured rant, because it's early in the morning and I haven't yet had my coffee, but had to type this while it was still fresh. :/
There are some who claim that it does not. In particular they claim that there is a longer tail on both ends of the curve than a normal distribution would predict.
http://www.abelard.org/burt/burt-ie.asp
But there are others who refute that claim. Their analysis shows there are actually fewer supernormal outliers than you would expect for a normal distribution.
http://www.ncurproceedings.org/ojs/index.php/NCUR2012/articl...
Either way it's a pretty close fit and the argument is just about whether there is a small variance several standard deviations from the mean.
And, yes, there has always been disagreement about what IQ really is, what do IQ tests measure, what forms of intelligence aren't measured in IQ tests, etc. I've always settled for the tautological definition. IQ is what an IQ test measures.
http://www.abelard.org/burt/burt-ie.asp
But there are others who refute that claim. Their analysis shows there are actually fewer supernormal outliers than you would expect for a normal distribution.
http://www.ncurproceedings.org/ojs/index.php/NCUR2012/articl...
Either way it's a pretty close fit and the argument is just about whether there is a small variance several standard deviations from the mean.
And, yes, there has always been disagreement about what IQ really is, what do IQ tests measure, what forms of intelligence aren't measured in IQ tests, etc. I've always settled for the tautological definition. IQ is what an IQ test measures.
Personally I think intelligence is trainable and a part of the reason we do not see more intelligent people is because the RoI of scoring well on tests and IQ tests drops off pretty quickly
There was a write-up about this paper in MIT Technology Review: https://www.technologyreview.com/s/610395/if-youre-so-smart-...
The writeup title is also a bit wrong though. Because "smartness" or even "aptitude" are not the sole filter between relative success and relative failure.
I think it often boils down to this: people who have more resources are allowed to test their luck multiple times, fail and try again until they succeed. People who don't have resources (a large inheritance say, no college debt) even if they are smart, might only get to try once. Invest their time, energy, money into one venture, fail and they could be screwed.
So in other words, looking back a particular instance of success might look like luck, or a coin toss. But some people just have more coins to flip than others.
You can also factor persistence in there as well, and make not just about money. Say those that fail have enough stubbornness to get up, get to toss the coin again, and again. So perhaps sometimes the limitations are self-imposed not just external resources that are limited.
So in other words, looking back a particular instance of success might look like luck, or a coin toss. But some people just have more coins to flip than others.
You can also factor persistence in there as well, and make not just about money. Say those that fail have enough stubbornness to get up, get to toss the coin again, and again. So perhaps sometimes the limitations are self-imposed not just external resources that are limited.
“Chance favors the prepared mind”
Not to mention the distribution of talent is also a matter of simple luck.
People tend to ignore this when they are trying to justify how the talents they have make them “better” than others or that it means they deserve more... for that matter, “having more” is a false success metric anyway, but that’s another story.
People tend to ignore this when they are trying to justify how the talents they have make them “better” than others or that it means they deserve more... for that matter, “having more” is a false success metric anyway, but that’s another story.
> talent is also a matter of simple luck.
There's no proof to this [0]. For many of us, talent is a matter of hard work and dedication.
[0] https://www.scientificamerican.com/article/is-innate-talent-...
There's no proof to this [0]. For many of us, talent is a matter of hard work and dedication.
[0] https://www.scientificamerican.com/article/is-innate-talent-...
What if the ability and dedication to work hard also the luck of the genetic shuffle? I started seriously thinking about this when reading up on autism a few years back.
(I don't have any answers, just a nagging suspicion that pretty much everyone is getting these sorts of moral questions wrong. I mean, if I don't get any credit for working hard to create a modestly successful very small business, why should I get the blame for anything I do?)
(I don't have any answers, just a nagging suspicion that pretty much everyone is getting these sorts of moral questions wrong. I mean, if I don't get any credit for working hard to create a modestly successful very small business, why should I get the blame for anything I do?)
You're making a semantic argument. That's often fine, but is irrelevant in this case.
To the extent talent is innate, it's a matter of luck. To the extent it takes thousands of hours of practice, well... how is it that one has the opportunity and ability to practice some thing for thousands of hours? You generally need a some mixture of support and dedication. Your level of support is clearly a matter of luck... and the qualities of dedication and working hard must be either be skills that you have to acquire somehow or innate talents. Which again, both seem to be matters of luck.
To me, it seems like a fools game to try to find reasons to justify why you're more deserving of this or that than someone else. The deeper you dig, the less reasons you can find to actually feel superior (or inferior, for that matter).
To the extent talent is innate, it's a matter of luck. To the extent it takes thousands of hours of practice, well... how is it that one has the opportunity and ability to practice some thing for thousands of hours? You generally need a some mixture of support and dedication. Your level of support is clearly a matter of luck... and the qualities of dedication and working hard must be either be skills that you have to acquire somehow or innate talents. Which again, both seem to be matters of luck.
To me, it seems like a fools game to try to find reasons to justify why you're more deserving of this or that than someone else. The deeper you dig, the less reasons you can find to actually feel superior (or inferior, for that matter).
This obviously depends on the definition of talent.
If talent is taken from the dictionary definition: "the natural endowments of a person" (https://www.merriam-webster.com/dictionary/talent)
then obviously hard work has nothing to do with it (by definition) and therefore it is just pure luck - no one chooses their genes.
I guess what you meant to argue is that innate talent doesn't exist ("for many of us") and therefore, talking about expertise and success ("talent") depends mostly on hard work, and not on some "luck of the genetic lottery".
However, if you read past the 4th paragraph in your linked article, you'll find the "innate talent doesn't exist" view is not supported at all:
"Ericsson and Pool gloss over or omit critical details of research they review that undermine the anti-talent argument"
"Ericsson and Pool also leave out a good deal of evidence that runs counter to the anti-talent argument. For example, they claim that professional baseball players have “no better eyesight than an average person,” but there is evidence to suggest otherwise."
"Another notable omission from Peak is a study of 18 prodigies by Joanne Ruthsatz and colleagues—to date, the largest study of the intellectual abilities of prodigies. (Given the rarity of prodigies, a sample size of 18 is very large in this area of research.) The researchers gave the prodigies a standardized IQ test, and found that all scored very high on working memory (most were above the 99th percentile, and the average score for the sample was in the top 1%). A major factor underlying the ability to acquire complex skills, working memory is substantially heritable."
"There is also no discussion of the landmark Study of Mathematically Precocious Youth (...) Now in its forty-fifth year, this longitudinal study has revealed that, even in the top 1%, cognitive ability in childhood is a significant predictor of objective occupational achievements in adulthood, such as earning advanced degrees, publishing scientific articles, and patent awards."
"Based on our own evaluation of the evidence, we argue in a recent Psychological Bulletin article that training is necessary to become an expert, but that genetic factors may play an important role at all levels of expertise, from beginner to elite."
If talent is taken from the dictionary definition: "the natural endowments of a person" (https://www.merriam-webster.com/dictionary/talent)
then obviously hard work has nothing to do with it (by definition) and therefore it is just pure luck - no one chooses their genes.
I guess what you meant to argue is that innate talent doesn't exist ("for many of us") and therefore, talking about expertise and success ("talent") depends mostly on hard work, and not on some "luck of the genetic lottery".
However, if you read past the 4th paragraph in your linked article, you'll find the "innate talent doesn't exist" view is not supported at all:
"Ericsson and Pool gloss over or omit critical details of research they review that undermine the anti-talent argument"
"Ericsson and Pool also leave out a good deal of evidence that runs counter to the anti-talent argument. For example, they claim that professional baseball players have “no better eyesight than an average person,” but there is evidence to suggest otherwise."
"Another notable omission from Peak is a study of 18 prodigies by Joanne Ruthsatz and colleagues—to date, the largest study of the intellectual abilities of prodigies. (Given the rarity of prodigies, a sample size of 18 is very large in this area of research.) The researchers gave the prodigies a standardized IQ test, and found that all scored very high on working memory (most were above the 99th percentile, and the average score for the sample was in the top 1%). A major factor underlying the ability to acquire complex skills, working memory is substantially heritable."
"There is also no discussion of the landmark Study of Mathematically Precocious Youth (...) Now in its forty-fifth year, this longitudinal study has revealed that, even in the top 1%, cognitive ability in childhood is a significant predictor of objective occupational achievements in adulthood, such as earning advanced degrees, publishing scientific articles, and patent awards."
"Based on our own evaluation of the evidence, we argue in a recent Psychological Bulletin article that training is necessary to become an expert, but that genetic factors may play an important role at all levels of expertise, from beginner to elite."
My answer: neither
Persistence has been far more important for me than either talent or luck.
Persistence has been far more important for me than either talent or luck.
It could be that the magnitude of successes tends to result from the multiplication of several factors, talent being one of them. Luck and location are two other candidates.
If the factors are roughly independent and normally distributed, the output could be approximated fairly well with Log-Normal Distribution which often appears very similar to Power Law Distribution given certain assumptions.
If the factors are roughly independent and normally distributed, the output could be approximated fairly well with Log-Normal Distribution which often appears very similar to Power Law Distribution given certain assumptions.
Correction for above: Each factor needs not be normally distributed, just independent.
Evidence that suggests Log-Normal is at least as plausible as Power Law as a model for wealth distribution:
"Using recently developed empirical methodology for detecting power-law behaviour introduced by Clauset et al. we have found that top wealth values follow the power-law behaviour only in 35% of analysed cases. Moreover, even if the data do not rule out the power-law model usually the evidence in its favour is not conclusive – some rivals, most notably the log-normal and stretched exponential distributions, are also plausible fits to wealth data."
https://arxiv.org/pdf/1304.0212.pdf
Evidence that suggests Log-Normal is at least as plausible as Power Law as a model for wealth distribution:
"Using recently developed empirical methodology for detecting power-law behaviour introduced by Clauset et al. we have found that top wealth values follow the power-law behaviour only in 35% of analysed cases. Moreover, even if the data do not rule out the power-law model usually the evidence in its favour is not conclusive – some rivals, most notably the log-normal and stretched exponential distributions, are also plausible fits to wealth data."
https://arxiv.org/pdf/1304.0212.pdf
I Wonder if gaming models (like strategic game simulations) can help to visualize what we mean by luck. We can improve our luck or chance by education, taking chances, and etcetera. This is so easy to show in games (you stay passive you will be eaten by opponents, you go too aggressive the same result).
Any way to create randomness?
You can, at the very least, make sure that your prepared for the random, lucky opportunities that come your way! Be in a position to seize the opportunity.
I also don’t see why you couldn’t increase the number of opportunities that you do come across. For example comparing someone that explores their field talking to different people versus someone that does the bare minimum.
I also don’t see why you couldn’t increase the number of opportunities that you do come across. For example comparing someone that explores their field talking to different people versus someone that does the bare minimum.
> For example comparing someone that explores their field talking to different people versus someone that does the bare minimum.
In social situations, talent (via extroverted personality, lack of shyness, being presentable) can appear to be a way to make your own luck.
In social situations, talent (via extroverted personality, lack of shyness, being presentable) can appear to be a way to make your own luck.
not being lazy so you get more exposure to randomness.
I mean in particular causing chaos for luck.
tl;dr: Intelligence ("talent") has a Gaussian distribution, but money ("success") follows a power law. The difference might be "luck", and they use a simple agent-based model to simulate intelligence+luck to get power-law success. "The most talented people [almost never] reach the highest peaks of success, being overtaken by mediocre but sensibly luckier individuals."
Some interesting policy analyses, too. "[I]t is evident that, if the goal is to reward the most talented persons (thus increasing their final level of success), it is much more convenient to distribute periodically (even small) equal amounts of capital to all individuals rather than to give a greater capital only to a small percentage of them, selected through their level of success - already reached - at the moment of the distribution."
Some interesting policy analyses, too. "[I]t is evident that, if the goal is to reward the most talented persons (thus increasing their final level of success), it is much more convenient to distribute periodically (even small) equal amounts of capital to all individuals rather than to give a greater capital only to a small percentage of them, selected through their level of success - already reached - at the moment of the distribution."
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