Tag: wealth (page 1 of 2)

Wealth is a product of luck

This seems obvious to me: that luck plays a great part in success. Well, serendipity, perhaps which can always be given a helping hand by elite networks and pushy parents…

Definition of luck

The conventional answer is that we live in a meritocracy in which people are rewarded for their talent, intelligence, effort, and so on. Over time, many people think, this translates into the wealth distribution that we observe, although a healthy dose of luck can play a role.

But there is a problem with this idea: 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.

The same is true of effort, as measured by hours worked. Some people work more hours than average and some work less, but nobody works a billion times more hours than anybody else.

And yet when it comes to the rewards for this work, some people do have billions of times more wealth than other people. What’s more, numerous studies have shown that the wealthiest people are generally not the most talented by other measures.

What factors, then, determine how individuals become wealthy? Could it be that chance plays a bigger role than anybody expected? And how can these factors, whatever they are, be exploited to make the world a better and fairer place?

Source: If you’re so smart, why aren’t you rich? Turns out it’s just chance. | MIT Technology Review

Image: CC BY-ND fearthekumquat

100% inheritance tax?

If we can’t stop people raking up ridiculous sums of money, we can definitely prevent them passing on that wealth to their kids. Thankfully, more enlightened rich people (in this case actor Daniel Craig) are already putting their own measures in place.

In a Hollywood interview published this week in Candis magazine, Mr Craig made reference to Andrew Carnegie, the Scottish-born US industrialist and one of the wealthiest men in history.

“Isn’t there an old adage that if you die a rich person, you’ve failed?” he said. “I think Andrew Carnegie gave away what in today’s money would be about $11 billion, which shows how rich he was because I’ll bet he kept some of it too.“

But I don’t want to leave great sums to the next generation. I think inheritance is quite distasteful. My philosophy is: get rid of it or give it away before you go.”

Source: ‘Inheritance is distasteful’: Daniel Craig’s children will not be getting his Bond millions | The Telegraph

Unless one is a genius, it is best to aim at being intelligible

Can on rotary phone. Everything is pink.

👯‍♀️ Secrets of the VIP Party: Why the 1% Love ‘Ritualised Waste’ — “Post-pandemic, in a broader sense, you glimpsed an immediate reckoning and disgust with ostentatious displays of wealth in the context of COVID-19. We saw some instances where people would make statements like ‘we’re all in this together’, while broadcasting from their luxury yacht or private island, followed by a backlash. I think they’ve quickly learned not to do that since…”

This is an incredible read: an interview with a former model turned sociology professor.


💳 Germany To Let Citizens Store ID Cards On Smartphone — “The Interior Ministry said Wednesday that from this fall, citizens will be able to use the electronic ID stored in their smartphones together with a PIN number to prove they are who they claim to be when communicating with authorities or private businesses.”

It’s Germany, so I’m sure they’ll do this sensibly, but it’s incredible to think how quickly smartphones have become an essential part of our everyday life.


🏛️ ‘A very dangerous epoch’: historians try to make sense of Covid — “It is not just the Covid pandemic that can make these feel like unusually significant times. Populism, Trump’s rise and (perhaps) fall, Brexit, the Black Lives Matter and #MeToo protests, mass movement of refugees, the increased might of both China and India and many other issues have contributed to a sense of humanity having reached a historic moment, all while the climate crisis rages with ever more urgency.”

People always think they’re living through unprecedented times. But in our case, we probably are.


🚸 Why there’s no such thing as lost learning — “The fact is that we – as a community of politicians, teachers and education experts – decide what any child must know, understand or be able to do at each age, not some natural law of learning. Why should a child know the structure of a cell membrane by the age of 16? I couldn’t know that information at 16 because it had not yet been fully discovered and described. But I learned it at a later stage.”

This is a useful post to point people towards, as the author does a great job of pointing out the ridiculousness of putting an arbitrary body of knowledge before the well-being of young people.


👑 Should Elizabeth II be Elizabeth the Last? At least allow Britain a debate — “But none of [these revelations] reflect the real damage the monarchy inflicts on us. It’s not their money nor their abuse of power, but their very existence that ambushes and infantilises the public imagination, making us their subjects in mind and spirit.”

My views on privilege hardly need rehearsing here, but suffice to say that one of the main problems with our tiny island is the delusions of grandeur we have through outdated institutions such as the monarchy.


Quotation-as-title by Anthony Hope. Image by Tyler Nix.