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> But it also gets harder and harder to get that kind of money by skill and hard work. Large amounts of money are more difficult to obtain by any means than sma
by darawk 8y ago
> But it also gets harder and harder to get that kind of money by skill and hard work. Large amounts of money are more difficult to obtain by any means than small amounts of money.
You don't seem to be understanding the point. Let's take an example. Do you think that it is more common, in general, for the wealthiest person in the world to be the result of skill or luck? I think empirically, and simply reasoning a priori we should conclude that the wealthiest person in the world will most commonly be skill-based, in all possible worlds.
Why is that? Well, because the dynamical process that produces wealthy people through luck has a squashed distribution relative to the one that produces them through skill. Skill allows you to create new things that have never existed before (tech billionaires) or understand the world in some new way that is statistically outlying (e.g. the very wealthiest investors, Buffet, Simons, etc.). The dynamical process that produces luck-based wealth is related to knowing people, gambling, and/or inheritance. That process is inherently more constrained by practical dynamics. Nobody is going to be your counterparty to multi-billion dollar gambles, inheritances tend to get split among many heirs, lotteries don't generally mint deca-billionaires, etc..
> And again, if you are just going to assert that obtaining vast wealth by hard work and skill is more likely than obtaining it by luck, then you are begging the question.
I am not asserting that, at least, not exactly. I am asserting that the distribution of wealth produced by each is different, and that has consequences for the base rates of either in the general population. The skill-based wealth distribution has a longer tail than the luck-based one. Which means, that at the very edges of the distribution, the ratio of luck to skill should favor skill.
- foldr 8y agoYes, so you are simply begging the question. The reasons you give for skill being the more likely explanation are purely speculative. Investing is a good example. Even if success in investing were largely down to chance, you'd still expect to find a small number of individuals who were enormously successful. Compare misfortune, which no-one wants to take credit for. A small number of people are struck by lightning or die from rare diseases. There's nothing necessarily special about them - they're just unlucky.
- darawk 8y ago> Yes, so you are simply begging the question. The reasons you give for skill being the more likely explanation are purely speculative. Erm, no. I gave a specific argument. You can call it speculation I suppose, but it is certainly more than you've given here. And 'speculation' and 'begging the question' are very different things. I am not making a circular argument.
- foldr 8y agoYou claim that "the dynamical process that produces luck-based wealth is inherently more constrained by practical dynamics". I don't see any argument in support of that assertion except a list of luck-based mechanisms that don't yield billions of dollars. Here are some luck-based mechanisms that do: * Starting a business which succeeds owing to a lucky bet on what kind of product will sell well. * Taking a lucky guess at which high-risk investments will pay off.
- darawk 8y agoYes, those things can pay off. My argument is not that such things do not exist, but that there are fewer instances of those at the very tails than there are of talent-based success. You need only examine the right tail of the wealth distribution to see that this is so. The very richest people in the world are there because of their own skill and insight. Gates, Buffet, Bezos, Kochs. As you step further down into the wealth distribution, you'll see some family money, like the Waltons. If Sam Walton the original was still alive, he'd be near the top...but by exactly the process I described, his children are no longer there.