Study says being rich is determined by chance rather than intelligence or talent

[CuriousGeorge]

I beg to disagree to this we all know that each and all of us has the right timing and our own clock right but we must consider that we ourselves are needed to work hard and even have a smarter brain and good attitude in life,.

thats only 2 factor of many factors that make you rich. Chance is indeed the only most importabt thing to become rich because if you dont have chance like an example you want to start certain business but yoi dont have capital and not even eligible for starting mass crowdfunding then what you can do?
I do agree that that rich determined by chance other than intelligence or talent, but being rich is different from being success.

[Sidilatte07]

According to my personal belief a successful person is a person who dared to accept the opportunities that are in sight. From various successes such as the height of knowledge that he has or with hard work will be lost with the lucky people dare to take risks with opportunities that exist. As talented and intelligent people can not necessarily beat a coincidence. This is the reality of life.

[shaikhimoqc]

Rich people try to make themselves rich.The poor have always wanted to be rich.

If you don't intend to create wealth with all your heart and soul, you are likely to create little wealth.

[Rossy Akbar]

Well I mean we're really need an absolutely good chance to being rich, inteligency and talent is just another tools for we to go through. In my religion to becoming a successful and rich we need to be struggle and praying, if there is a chance don't waste it and be patience, don't give up if you have a challenge.

[jemma]

I differ slightly with the assertion of this article where it posits that chance ALONE is a factor in determining who gets wealthy and who doesn't...I think its a both "chance + talent/inteligence among other variables.

[artichandra]

I agree with that, I once read a book. The book tells every person in the world only lose one person is the Lucky One. Lucky people can become rich only in a short time and minimal capital.

[redcucumber]

I also questioned why is it like that, because informations are available in the internet for us to explore and to know and try but it does take a lot of courage to try and test it for own and believe it will succeed.

[Commie]

I beg to disagree to this we all know that each and all of us has the right timing and our own clock right but we must consider that we ourselves are needed to work hard and even have a smarter brain and good attitude in life,.

Actually working hard doesn't have anything to do with being (becoming) rich. Never did.

[weblouartisan]

I am not entirely surprised by this at all actually, anecdotally I have always felt people who achieved success where mainly in the right place right time. Whether that be born to a certain family or class, or to a certain country, or area of a country, these things all effect where we will end up. Good to know us average folk can still make it in this rigged world

Actually i do not really think that being a chance is a choice because it was actually depends on how you are really determined to become rich at the earliest stage of your life, you always need to work hard in order to earn something.

[thend1949]

I beg to disagree to this we all know that each and all of us has the right timing and our own clock right but we must consider that we ourselves are needed to work hard and even have a smarter brain and good attitude in life,.

thats only 2 factor of many factors that make you rich. Chance is indeed the only most importabt thing to become rich because if you dont have chance like an example you want to start certain business but yoi dont have capital and not even eligible for starting mass crowdfunding then what you can do?
I do agree that that rich determined by chance other than intelligence or talent, but being rich is different from being success.

Chances may come along the way but the resourcefulness and the creativity of our mind will put meaning into it and make it valuable. No matter how many chances being dumped into you, but if you are not intelligent enough to make it prosper, it's still useless. Besides, if you keep on waiting for chance to come, I don't think there's going to happen. Chances are good because it knocks on your door to offer something special, but sometimes I think it's better if you find your own door, offer your service where you excel and be progressive.

[goldenplak]

I thin that, nothing can change a person's fate except from the person himself, it all depends on our own whether to try or not, I believe the effort does not betray the results. unless

[Fatimah Azzahra]

Being rich in my opinion is not from talent or intelligence.
but indeed someone already has a line and also destiny to become rich, even many rich people who come from a poor life and also do not have a high education, but that does not mean we are resigned to the circumstances
and become a lazy person to seek knowledge education and become a smart person.
but there are times when we must be in the knowledge and knowledge of knowledge widely for a time when we become a wealthy, we are not easy to fool someone who is smarter than us, essentially if we can be smart and also rich, it is much better .

[hamdun]

If you’re so smart, why aren’t you rich? Turns out it’s just chance

The most successful people are not the most talented, just the luckiest, a new computer model of wealth creation confirms. Taking that into account can maximize return on many kinds of investment.

The distribution of wealth follows a well-known pattern sometimes called an 80:20 rule: 80 percent of the wealth is owned by 20 percent of the people. Indeed, a report last year concluded that just eight men had a total wealth equivalent to that of the world’s poorest 3.8 billion people.

This seems to occur in all societies at all scales. It is a well-studied pattern called a power law that crops up in a wide range of social phenomena. But the distribution of wealth is among the most controversial because of the issues it raises about fairness and merit. Why should so few people have so much wealth?

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?

Today we get an answer thanks to the work of Alessandro Pluchino at the University of Catania in Italy and a couple of colleagues. These guys have created a computer model of human talent and the way people use it to exploit opportunities in life. The model allows the team to study the role of chance in this process.

The results are something of an eye-opener. Their simulations accurately reproduce the wealth distribution in the real world. But the wealthiest individuals are not the most talented (although they must have a certain level of talent). They are the luckiest. And this has significant implications for the way societies can optimize the returns they get for investments in everything from business to science.

Pluchino and co’s model is straightforward. It consists of N people, each with a certain level of talent (skill, intelligence, ability, and so on). This talent is distributed normally around some average level, with some standard deviation. So some people are more talented than average and some are less so, but nobody is orders of magnitude more talented than anybody else.

This is the same kind of distribution seen for various human skills, or even characteristics like height or weight. Some people are taller or smaller than average, but nobody is the size of an ant or a skyscraper. Indeed, we are all quite similar.

The computer model charts each individual through a working life of 40 years. During this time, the individuals experience lucky events that they can exploit to increase their wealth if they are talented enough.

However, they also experience unlucky events that reduce their wealth. These events occur at random.

At the end of the 40 years, Pluchino and co rank the individuals by wealth and study the characteristics of the most successful. They also calculate the wealth distribution. They then repeat the simulation many times to check the robustness of the outcome.

When the team rank individuals by wealth, the distribution is exactly like that seen in real-world societies. “The ‘80-20’ rule is respected, since 80 percent of the population owns only 20 percent of the total capital, while the remaining 20 percent owns 80 percent of the same capital,” report Pluchino and co.

That may not be surprising or unfair if the wealthiest 20 percent turn out to be the most talented. But that isn’t what happens. The wealthiest individuals are typically not the most talented or anywhere near it. “The maximum success never coincides with the maximum talent, and vice-versa,” say the researchers.

So if not talent, what other factor causes this skewed wealth distribution? “Our simulation clearly shows that such a factor is just pure luck,” say Pluchino and co.

The team shows this by ranking individuals according to the number of lucky and unlucky events they experience throughout their 40-year careers. “It is evident that the most successful individuals are also the luckiest ones,” they say. “And the less successful individuals are also the unluckiest ones.”

That has significant implications for society. What is the most effective strategy for exploiting the role luck plays in success?

Pluchino and co study this from the point of view of science research funding, an issue clearly close to their hearts. Funding agencies the world over are interested in maximizing their return on investment in the scientific world. Indeed, the European Research Council recently invested $1.7 million in a program to study serendipity—the role of luck in scientific discovery—and how it can be exploited to improve funding outcomes.

It turns out that Pluchino and co are well set to answer this question. They use their model to explore different kinds of funding models to see which produce the best returns when luck is taken into account.

The team studied three models, in which research funding is distributed equally to all scientists; distributed randomly to a subset of scientists; or given preferentially to those who have been most successful in the past. Which of these is the best strategy?

The strategy that delivers the best returns, it turns out, is to divide the funding equally among all researchers. And the second- and third-best strategies involve distributing it at random to 10 or 20 percent of scientists.

In these cases, the researchers are best able to take advantage of the serendipitous discoveries they make from time to time. In hindsight, it is obvious that the fact a scientist has made an important chance discovery in the past does not mean he or she is more likely to make one in the future.

A similar approach could also be applied to investment in other kinds of enterprises, such as small or large businesses, tech startups, education that increases talent, or even the creation of random lucky events.

Clearly, more work is needed here. What are we waiting for?

Ref: arxiv.org/abs/1802.07068 : Talent vs. Luck: The Role of Randomness in Success and Failure

https://www.technologyreview.com/s/610395/if-youre-so-smart-why-arent-you-rich-turns-out-its-just-chance/

A very interesting spin on anything that has ever been said about money, success or wealth!

I don't know what to think about this. The scaling argument which says 1% of the human population shouldn't own 40% of the world's wealth due to them not having IQ's of 200,000 or talent proportional to the highly disproportionate stake of wealth they control is something that will take time for me to digest and think about. Its certainly a novel concept.

Its also very interesting that they attempted to model along lines of standard deviation and wound up with a historical 20/80 wealth distribution. I think this is something which could use more exposure and media coverage. Its not often relatively original or new perspectives like this come along and the paradigm shift which can accompany them can often take decades to be fully appreciated within a pop culture vein.

I guess that's not always true, the person holding bitcoin in 2009 is not a coincidence, but they already believe in bitcoin that bitcoin will give them an edge.

[Pattberry]

"There is a huge difference between those who made a lot of money and those who are rich," - Marlene Dietrich.

A smart or lucky person can get a lot of money, but only a wise person can save them.

If you are a movie star or an athlete you could make a lot of money but it will only last if you are smart enough to handle your assets, if not it will vanish just like that, we have seen many sports stars who made millions end up filing for bankruptcy. So having intelligence and talent is equally important to become rich and you cannot be rich by chance unless you are inheriting the wealth.

[zhelis74]

"There is a huge difference between those who made a lot of money and those who are rich," - Marlene Dietrich.

A smart or lucky person can get a lot of money, but only a wise person can save them.

If you are a movie star or an athlete you could make a lot of money but it will only last if you are smart enough to handle your assets, if not it will vanish just like that, we have seen many sports stars who made millions end up filing for bankruptcy. So having intelligence and talent is equally important to become rich and you cannot be rich by chance unless you are inheriting the wealth.

No, I think talent and intelligence is the most important asset to become rich because if those people have this kind of ability then there are more chances to be rich. Yes, chances are the nearest words to describe things people have to get but it will not happen without dedication, skills and knowledge towards the success of one's dream.

[kingkonjac]

instead of chance I would say it is determined by having an entrepreneurship spirit and create your own chances, as soon as you try in many areas to do something of course the chance of being richer is higher and you create your own chance.

[roseann072518]

I thinnk, on my opinion .. much better  that you have determined and talented self ..because if you have talent  and determination  you will be successful and rich.. most of all people  say study  is not important is you have talent and determination.

[EnricoGomez]

I somehow disagree.
If you are looking to be rich the easier way, luck is what you need.
You can be rich in being intelligent and talented but you need to be patient and hardworking. If you have both on your hands then it is the easiest.
If I were to choose between either then I'd rather go with intelligence and talent. What is the point in getting easy money with your luck when you cannot even make the right decisions to handle it efficiently?

[jcarlo]

instead of chance I would say it is determined by having an entrepreneurship spirit and create your own chances, as soon as you try in many areas to do something of course the chance of being richer is higher and you create your own chance.

Some peoples have chance and opportunity and they make it for success. I am believe beside chance and opportunity to make success, there is hard work and good spirit and always positive thinking on every opportunity

[Cinemo]

If you’re so smart, why aren’t you rich? Turns out it’s just chance

The most successful people are not the most talented, just the luckiest, a new computer model of wealth creation confirms. Taking that into account can maximize return on many kinds of investment.

The distribution of wealth follows a well-known pattern sometimes called an 80:20 rule: 80 percent of the wealth is owned by 20 percent of the people. Indeed, a report last year concluded that just eight men had a total wealth equivalent to that of the world’s poorest 3.8 billion people.

This seems to occur in all societies at all scales. It is a well-studied pattern called a power law that crops up in a wide range of social phenomena. But the distribution of wealth is among the most controversial because of the issues it raises about fairness and merit. Why should so few people have so much wealth?

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?

Today we get an answer thanks to the work of Alessandro Pluchino at the University of Catania in Italy and a couple of colleagues. These guys have created a computer model of human talent and the way people use it to exploit opportunities in life. The model allows the team to study the role of chance in this process.

The results are something of an eye-opener. Their simulations accurately reproduce the wealth distribution in the real world. But the wealthiest individuals are not the most talented (although they must have a certain level of talent). They are the luckiest. And this has significant implications for the way societies can optimize the returns they get for investments in everything from business to science.

Pluchino and co’s model is straightforward. It consists of N people, each with a certain level of talent (skill, intelligence, ability, and so on). This talent is distributed normally around some average level, with some standard deviation. So some people are more talented than average and some are less so, but nobody is orders of magnitude more talented than anybody else.

This is the same kind of distribution seen for various human skills, or even characteristics like height or weight. Some people are taller or smaller than average, but nobody is the size of an ant or a skyscraper. Indeed, we are all quite similar.

The computer model charts each individual through a working life of 40 years. During this time, the individuals experience lucky events that they can exploit to increase their wealth if they are talented enough.

However, they also experience unlucky events that reduce their wealth. These events occur at random.

At the end of the 40 years, Pluchino and co rank the individuals by wealth and study the characteristics of the most successful. They also calculate the wealth distribution. They then repeat the simulation many times to check the robustness of the outcome.

When the team rank individuals by wealth, the distribution is exactly like that seen in real-world societies. “The ‘80-20’ rule is respected, since 80 percent of the population owns only 20 percent of the total capital, while the remaining 20 percent owns 80 percent of the same capital,” report Pluchino and co.

That may not be surprising or unfair if the wealthiest 20 percent turn out to be the most talented. But that isn’t what happens. The wealthiest individuals are typically not the most talented or anywhere near it. “The maximum success never coincides with the maximum talent, and vice-versa,” say the researchers.

So if not talent, what other factor causes this skewed wealth distribution? “Our simulation clearly shows that such a factor is just pure luck,” say Pluchino and co.

The team shows this by ranking individuals according to the number of lucky and unlucky events they experience throughout their 40-year careers. “It is evident that the most successful individuals are also the luckiest ones,” they say. “And the less successful individuals are also the unluckiest ones.”

That has significant implications for society. What is the most effective strategy for exploiting the role luck plays in success?

Pluchino and co study this from the point of view of science research funding, an issue clearly close to their hearts. Funding agencies the world over are interested in maximizing their return on investment in the scientific world. Indeed, the European Research Council recently invested $1.7 million in a program to study serendipity—the role of luck in scientific discovery—and how it can be exploited to improve funding outcomes.

It turns out that Pluchino and co are well set to answer this question. They use their model to explore different kinds of funding models to see which produce the best returns when luck is taken into account.

The team studied three models, in which research funding is distributed equally to all scientists; distributed randomly to a subset of scientists; or given preferentially to those who have been most successful in the past. Which of these is the best strategy?

The strategy that delivers the best returns, it turns out, is to divide the funding equally among all researchers. And the second- and third-best strategies involve distributing it at random to 10 or 20 percent of scientists.

In these cases, the researchers are best able to take advantage of the serendipitous discoveries they make from time to time. In hindsight, it is obvious that the fact a scientist has made an important chance discovery in the past does not mean he or she is more likely to make one in the future.

A similar approach could also be applied to investment in other kinds of enterprises, such as small or large businesses, tech startups, education that increases talent, or even the creation of random lucky events.

Clearly, more work is needed here. What are we waiting for?

Ref: arxiv.org/abs/1802.07068 : Talent vs. Luck: The Role of Randomness in Success and Failure

https://www.technologyreview.com/s/610395/if-youre-so-smart-why-arent-you-rich-turns-out-its-just-chance/

A very interesting spin on anything that has ever been said about money, success or wealth!

I don't know what to think about this. The scaling argument which says 1% of the human population shouldn't own 40% of the world's wealth due to them not having IQ's of 200,000 or talent proportional to the highly disproportionate stake of wealth they control is something that will take time for me to digest and think about. Its certainly a novel concept.

Its also very interesting that they attempted to model along lines of standard deviation and wound up with a historical 20/80 wealth distribution. I think this is something which could use more exposure and media coverage. Its not often relatively original or new perspectives like this come along and the paradigm shift which can accompany them can often take decades to be fully appreciated within a pop culture vein.

In some cases people become rich by their chance.  It is one time giving you an opportunity to spend your money wisely. And think of some investment or business that your money will grow bigger .Our hardworking  and become optimistic in everything we do, we will see the result someday .Better chance Us.