5 ms·
I think this is exactly right. Being successful in the top 0.1% is not actually rational. Even if you're brilliant, your chance of succeeding at that level is l
by darawk 6y ago
I think this is exactly right. Being successful in the top 0.1% is not actually rational. Even if you're brilliant, your chance of succeeding at that level is low. A truly rational person seeks out the best risk-adjusted return, not the best absolute return. If you're a technical minded person, making 300k/year in a software job is about the best risk-adjusted return of any profession I can think of.
- andi999 6y agoWell the risk is you have to move to the US to get that kind of salary in a software job.
- klipt 6y agoAnd the cost of living is so high that despite the fantastic salary most software engineers in Silicon Valley will never buy a house there. Great place to make money before retiring elsewhere though.
- edanm 6y agoWell yes, but many other countries have similar math when it comes to software engineering salaries as opposed to other fields. In most places, going into software is a good thing to do moneywise.
- andi999 6y agoGermany not. Software is more on the lower end of high skilled work, definitely not at the top end.
- edanm 6y agoInteresting. Still, am I correct that lower end of high skilled work is still middle-upper class in terms of income?
- andi999 6y agoI find it difficult to find reliable numbers (since I work in a different industry), but it seems median entry salary for IT graduate is 40k€, which is 25k€ nett anually. I also find the middle-upper class difficult for germany (since salary upper class doesnt mean you are asset upperclass aka rich). Personally I would say 25k€ nett is middle class; but here everybody wants to belong to the middle class so it usually has a wide stretch. Big companies are unionized so salarys do not get that big, but are considered higher then in non-unionized companies. How is the situation in the US?
- lanstin 6y agoWhat is the optimal risk adjustment ratio? And it is chosen by reason or by personal preference? Many software engineers are a bit risk averse and just do what they are told to do. Many entrepreneurs would rather experience the rushes of a business roller-coaster and walk away with no money than just sit and program as told.
- darawk 6y agoThere is no optimal ratio per se. You just divide gain by risk and maximize that quantity. This is a scale invariant function, at least, with respect to its maximum.
- lanstin 6y agoI think you must be omitting variables, or simply trying to maximize dollars or some other approximately ordered quantity rather than maximize subjective fulfillment in life.
- darawk 6y agoWhich variables are being omitted? Certainly there are other variables relevant to a quality life than money. But the rules apply to any utility function you might come up with. You want to maximize risk-adjusted return.