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

[KenChanYu]

Not all smart people are rich we can see beggars on the internet going viral because some of them are fluent in English while others are good in solving math problems. I think for some people it is their fate but for some they choose on what status of life they want to be. I know some people that are happy despite of being poor while some people who are rich are quite lonely.

Being a smart person is the most important thing and that it plays a key role in helping you in making more money and that you need to use your brain to make the wise decisions and to expect for something better in your life.

There is no way that you can rely on any kind of chance or on your luck completely for the sake of making money. You need to put in your best efforts as well to get the desired results.

If we study the life style of all the people who somehow managed to get richer and the ones who made a lot of earning in their lives, then we’ll get to know that not even one out of them have earned money just because of his luck or because of getting some chance or any other thing like that. It is all and all your hard work and personal efforts which pays you off at the end and which can help you in getting richer.

Richness is partnered with failures. Successful people fail but the only difference is that they don't dwell on the failures instead they learned from them and they don't repeat the same failures. I don't believe it's determined by chance. It takes a lot of hardwork, commitment, knowledge, and action. We all can be rich, anybody can be successful. It’s a matter of having a strong desire, and doing what it takes to achieve it.

[1715575652]

1715575652

[Visteryy]

Agreed with you, if we seize the opportunity then we will become rich. Smart and hard does not make us rich, it only helps us to earn a living for a living. If you know the year of chance, I bought Bitcoin in 2009

[Bitcoincole]

Agreed with you, if we seize the opportunity then we will become rich. Smart and hard does not make us rich, it only helps us to earn a living for a living. If you know the year of chance, I bought Bitcoin in 2009

For me, talent and skills and intelligence as well as chance are only tools that can make us rich. What really make people rich is not the chance itself but the fact that he/she grab the chance given and work for it. You will never get rich if you will just sleep all day long no matter how intelligent you are. You have to get up,make use of your talent and intelligence and grab every open chances along the way.

[Ramtapsbtc]

I agree with it. Going to school to learn does not give you the guarantee that you will become rich but rather it is the break in life that come to you and you should be able to acknowledge and use it. Here in our country the richest men and women is not the most intelligent people. They have just the chance to make business. Just like here in the crypto world where in we all had the chance to became rich.

[jeraldskie11]

Being rich its not determined by chance, its needed to do hardwork because your knowledge and intelligence will be useless if you don't do work of it. School and studies to learn does not mean you easily become a rich person its not like that you need to use it in working because this will help you to achieve and success in life.

[Vinz1978]

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 dont think it is by chance. I believe it is God's plan. No matter what you do and if its not His will,  you wont be rich. I also believe that it is someones fate and they are destine to get rich. But God wont bless anyone if they are lazy. You need to work hard and do something. Dont just wait for someone to throw you penny. Dont depend on others,  prove yourself that nothing is impossible for the person with dream and goal. Let that dream push you to reach your destination in life.

[Nylesor]

I believe being rich is determined by chance, by determination and hard work rather than intelligence or talent. Because intelligence and talent will not materialize if a person have no courage and determination to become rich. Though a combination of those all characteristics will make a person more rich and successful.

[shiki3226]

Aside from these things, working hard and persevering are also key factors for success. You need to be dedicated and passionate on what you are doing.

[PacePay]

Almost all for me. There is also a situation that if your family is rich then you are also, because you inherit all the wealth of you mother and father. There is also some person get rich because of their intelligence and talent, just because the want their life to change so they pursue to work hard to earn big money.

I think that it is more to believe that if a person is intelligent then he will be rich because he will know that if he will work hard then he will get paid for it and if he will not work hard then he will waste his life and his time and he will waste his energy with the passage of time. So it is the intelligent which make a person better in life and to participate in the life for to get his share.

[Raufjoze]

chance is a factor of course. noone can deny it. but you should do something i mean you should make a step to become a rich. you can not be a rich just by luck. even if you are a lottery winner, it means that you spent money to buy a ticket. so it is not only chance or luck.

I think one thing for sure is luck and the gauze work will not be easy for everyone. It's just a saying, more precisely in the sense that a highly educated and knowledgeable person has a great chance of being successful or wealthy but when a person has a high luck in his life and he finds his business and business keep advancing until he gets rich when he does not have a high education

[makolz26]

I don't think that we are living only by chance and that being rich is just for those who are lucky one, some people who are getting rich may  not be intelligent as to what we are expecting most of them are people who are hardworking, determined and perseverance, they do have a positive mindset that they can reach their goal that is why they are doing anything to change their life.

[slyfox]

It is a combination of many factors. You can't say that 100% of the rich people are intelligent and hardworking, while 100% of the poor people are retarded and lazy.

It is a combination of factors there is no doubt about it, but in average a person that is very intelligent will eventually get out of poverty because of his intelligence, however there are people that will get most of his money because of luck, they did nothing to deserve that wealth they were just fortunate enough to get it but if they do not take steps to maintain that wealth, it is very likely that they are going to waste it.

[Savemore]

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.

There are many persons here in the cryptocurrency world who became rich because they study hard and work hard. Having a lot of knowledge can help us to overcome our financial problems and become successful in the near future.

[kimochidesh]

I agree with you that chance or luck plays a great role in the success o a person. Most o the people became successful because they happen to bag a right opportunity at right time and place. But it not like only your destiny or luck can make you successful or you can become successful only by chance. If you have the talent and a strong will to accomplish your goals, the success will definitely find a way to you.

[Sled]

I agree with you that chance or luck plays a great role in the success o a person. Most o the people became successful because they happen to bag a right opportunity at right time and place. But it not like only your destiny or luck can make you successful or you can become successful only by chance. If you have the talent and a strong will to accomplish your goals, the success will definitely find a way to you.

It is not about the luck because it is about the courage that they have to take the risk. All the opportunities are there and if they don't knock then build a door. Find a way to get those opportunities because you should not stop looking for opportunities because opportunities is the only thing that can change your life.

[shainasaz]

There are many people who became a rich person because they work and study hard to gain knowledge and ideas on how it will works. Having these things help them to overcome it to be successful in life. We can say that it is an opportunity/chances because not all of people know bitcoin and we are proud that we are one that chosen on it to join this job.

[maculeth]

that is called fate. if it is already destined to be rich, lazy people too will be lucky. but we still need to work hard and also learn, for the final result, still a decisive fate.

[saifanik]

Chances are more important than education,to be rich, not knowledge or talent.But in my opinion,this is not right,but three are complementary to each other.Because knowledge or talent need in all areas of life. It is impossible to proceed without them.And when you have to use the chance, then work must be done through knowledge or talent.That is why it is better to have rich than knowledge or wisdom.It's said that exceptional isn't example.Someboday gets rich with chamce.

[realcrypto]

Being rich is not a factor of intelligence or talent but it a factor of chance, opportunity, getting the right information at the right time and meeting the right people.

[jimmybush07702]

There are numerous individuals who turned into a rich individual since they work and concentrate hard to pick up information and thoughts on how it will functions. Having these things help them to beat it to be fruitful throughout everyday life. We can state that it is an opportunity/chances in light of the fact that not all of individuals know bitcoin and we are pleased that we are one that picked on it to join this activity.