Why a Very Few Have SOO Much - Prof. Jordan Peterson Explains Pareto Distribution
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- Опубликовано: 1 июн 2024
- Psychology professor Jordan B. Peterson explains the basis of Pareto distribution, what seems to govern any domain of creative production (and therefore much of the allocation of wealth).
This clip is only a small excerpt (with an easy to spot addition) of Jordan Peterson’s lecture “2017 Personality 13: Existentialism via Solzhenitsyn and the Gulag” held at the University of Toronto. You can watch it entirely here: • 2017 Personality 13: E...
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#WriteInAndrewYang! We must start somewhere...
As many times as I've played Monopoly, I've never finished that game. Thanks for spoiling what happens at the end, Mr. Peterson
Lel. Answer is in the name. Winner takes it all.
I miss playing Monopoly with my ex and friends. Good times vanished in to the air like smoke.
In my experience Monopoly almost always ends as professional chess.
Both final players see how slanted the game is and one gives up a bit before the game truly ends
@@turkishboyMLT it sucks to be you
Your thumbnails are great
That's very nice of you, thanks!
Libin Wang i
I agree
That's an understatement :D They blow the socks off of anything I've seen on RUclips in a long time, seriously
You...do realize that Monopoly is socialist propaganda, right? It was created by a georgist
You have to be careful here because a Pareto distribution can arise due to poor measurement tools. For example in my office, 3 of the 7 employees are responsible for all production as measured in monetary terms. This does not mean that the other 4 are eating bon bons with their feet up on desks. They work to assure the 3 clinicians can focus all their attention on the patients. Even though they do not "produce" revenue directly it would be impossible for the clinicians to produce at current levels if they had to the keep the schedule full, clean instruments and empty the trash in addition to treating patients. The more you analyze the system and assign value to the essential support positions the less Pareto-ish the distribution looks. Clearly there are still high producers and lower producers but it is most likely not as harsh as a purely mechanical interpretation the Pareto distribution suggests.
Alexander Crawford yes I agree that there is a real Pareto distribution among any specific group doing the same work. However I know o far few businesses that misapplied this idea and damaged their ability to thrive. The source of their error was incorrect measurement statistics and presuming Low performers in one area as defined only worked in that one area. Some of the most productive wear many hats but never dominate simple statistics in any one department. This can happen on a country basis as well and has in the past. Thomas Sowell has an excellent essay entitled “the persecution of the middleman minority”. In this he discusses the phenomenon of countries in history switches Spain who purged that class of individual that today we would call financial experts. In each case the persecution was undertaken partially for religious reasons but usually because a particular ethnic class due to other restrictions in the culture had developed expertise in handling and exchanging financial assets. To the wider population these people appear to be getting exceptionally wealthy but not doing anything constructive to get earn that wealth, I.e. the one percent. Once purged of theses plunders, each country fell into economic collapse lasting centuries in some cases. Be it Spain expelling the Jews, Turkey persecuting the Armenians, or west African nations opressing the Lebanese, the results are the same. The lesson of all this is that you best be very very sure as to your measurement parameters before you start taking action when you see a Pareto distribution because hidden in the data could be some essential information you were not aware of.
I think what follows from the distribution is that those have more get to make more attempts to win. You can't win if you can't even afford to play, as with the coin tosses.
ssm59 This kicks ass.
And then you see them vote and realize they really are worse than useless.
I think of it as a complex ecosystem of people doing jobs that make everyone else's jobs exist. For example, an engineer is nothing without that lowly technician on floor 6 room 27 B running a lathe. Similarly, if people do not have jobs where they operate at the maximum of their capacity, that machinist wouldn't have designs to follow.
I'm a simple man. I see a hilarious thumbnail of Jordan Peterson as the Monopoly guy, I click. I bash like. I'm not too worried about the video I've probably seen him say something like that already.
Dude I thought the exact same thing lol
After watching this I thought of something quite interesting. Presume a planets function is to produce life, there are 30 billion planets in the Milky Way, the square root of this number is just over 173,000. In the grander scale, this isn’t hugely optimistic, but a tenth of this has the possibility to create and sustain intelligent life, which again is very very little. Chances are this is just a load of bullshit that I thought up whilst I was having my lunch, but at least it made it more enjoyable :)
The slightest odds in an infinite universe will statistically come to fruition...it's not a stupid theory.
Yeah there’s an equation called the Drake equation that tells you the odds of alien life.
egads2 haha, very funny
Wow, can we be friends?
Godfred Boateng Sure, can’t say you won’t regret it though
Money always finds it's way to those who knows the laws of gold. Read the richest man in babylon.
People that are prepared to take risks, make more money but they can also lose more money. Everybody looks at the successful risk takers but the risk takers that lost are never remembered
I thought of something very interesting. Could be a bit obvious and blunt tho:
The number of people you meet and the number of places you go in your life or spend time at/with are gouverned by a pareto distribution aswell. Although I'm not sure sbout the crestive output thing here. If you go to your home /school / daily workplace, then you spend time there. That mudt mean that while you spend something like 8 hours a day asleep so obviously in your home. The time you could dpent awake and outside is something like 18 hours a day. Which would mean that you spend like x hours a day at: home, in a transportation device (something like a car or train), at school/work, somewhere to get food, at a friends place or a public place for entertainment. That would mean something like 5-6 different locations everyday. If we do the math and get the square root out, that would be an estimate range of 2,2 or 2,5 places that you would spent half your time at. Assuming that you're awake roughly something like 18 hours a day. This would mean that you would spend like 9 hours at work and at home per day. Leaving 9 hours for the rest of the little things you do while moving around different places. Which is roughly right.
poverty has been decreasing rapidly, this doesn't conform with people naturally reaching zero. i think the difference is that monopoly is a zero-sum game. the economy is not.
Poverty is different from inequality. Poverty is an absolute measure, of how much products you can buy with X amount of work. Inequality is a comparative thing, like the difference between the richest and the poorest. Technology and productivity can create wealth and raise the standard of living of everyone including the poorest, essentially reducing poverty, even if inequality stays at the same rate, like Peterson states in the video. This Pareto Distribution sounds like an inequality measure and not a poverty measure.
hmm yes i see what you/he is saying.
crucially, people don't get poorer, they just have less and less of the total wealth that exists.
from this we can say thought that his line "ALL the resources get funneled to a tiny minority of people at the top, and a huge section of the population stacks up at ZERO" is still false, it seems to be an impetuous extension of the monopoly/coin toss games into the real world economy.
i just think it's important to note as i don't want socialists exploiting the line "the majority end up with nothing"
Yea, i dont think that coin toss game translates very well into real world economy either.
@@ScottyNapaa The problem with socialism is it makes the government the ultimate monopoly. Power corrupts completely. Once the government is strong enough it just funnels the money from everyone, mainly the working class, directly into the hands if the government while the rich flee the country with their wealth.
@@marcsv0174 100%. in state-socialism.
there is libertarian socialism which is anti-government.
Found this video randomly, and you have a point I always thought about why can’t we just all keep each other on a level playing field sort of speak, but it does make sense that it has always been that way for the sake of keeping the society running properly. Good stuff professor.
The best thumbnails i'hve seen in my life.
Thank you very much.
Great vid, Dr. Peterson!
Fascinating!
The common misconception is that wealth is finite. Just because the rich get richer doesn’t mean the poor get poorer. There may or may not be a wider wealth disparity, but the poor also will get richer.
Exactly
Jon Bird Uh OK, time for your meds.
exactly. Poor people who complain about the rich are simply jealous. They get jealous when they see someone else who has something they dont. These jealous people are the ones who only care about money
I used to have a lot of friends in high school. Then my parents got rich and I started getting lots of money. All those friends were gone within a few months and I had new ones. But it wasnt me who left my friends. No, those friends just started looking at me differently due to having money. To them, I was no longer like them, I was something they either felt ashamed being with because they werent as "successful" or they were just jealous
@Zach Wealth is finite but it isn't fixed, it keeps growing. 500 years ago, all the gold in the world couldn't have bought you the spice shelves of one Tesco.
This is very seldom the case. How has trickle-down economics worked in the United States, for example?
"you dont learn about this in psychology"
-psychology professor lecturing his class.
He seems to mean generally
Brilliant!!!
This is awesome🙂
such interesting stuff
Very interesting
Amazing !!!!!!!!!!!!!
Always thought that.
TY for this nugget of information and insight! The Bible has 3 methods of economic readjustment; every year a small reallocation of funds happens through charity. Every 7 years there was a mid-sized realignment with loans being forgiven and indentured servants going free. Every 50th years a major realignment occurred with property returning to the original owner. Every society with a lopsided economy winds up in revolution. The Bible proposes an economic system with built-in safe guards to avoid this eventuality. The Pareto distribution is a wonderful explaination why the great division of wealth occurs.
Studied statistics for a year now and got to know the practical application of pareto distribution in a psychology class.
That's why Christian Values are so important in society such as love, mercy, justice, forgiveness, honesty and humbleness. Those at the top should consider themselves responsible for the well-beeing of others
no.
Vaulttech
why was that in there? The connection went over my head.
I NEED TO KNOW! 2:37
@@Johnathonaaron I think the connection is the Overseer and staff are the minority of people who have all of the power and the vault dwellers have 0 in quite a number of experiments.
@@drumyogi9281 Ahh, thanks for that. It makes sense now. I forgot about some of the experiments.
that thumbnail :))
These videos are great but they always end before we get to the point
gotta love the fallout 4 vault tec lunchbox....respect!
I've said that if you equally distribute money to everyone, it will find its way back to nearly the same group of people that had it in the first place.
I believe this is correct.
Those who have the money, are those who are selling the products. The products are priced according to what people can afford.
Stimulus checks go out, lots of money is floating around, these companies want to get that money!!
Last I heard, inflation was supposedly up 500% from where it was in 2020.
The assumption here is that creation is fairly compensated. Which is not always the case.
New subscriber here
This confirms the theory that if you distributed all the money in the world equally, then within about half-an-hour it would revert back to as it was originally.
Not even half a year. But eventually it would
It will not necessarily be the same individuals who sit on the money. Because who belongs to the rich top shifts.
As u shove money downward it tends to move back up
Direct Democracy and Cooperative Economics
+Macro Genii
direct democracy is inherently unstable and inevitably leads to oligarchy, as you can see all throughout history (with greece and rome being the most famous examples). there are only two stable forms of government: republics (rule of law) and oligarchies (rule of the few at the expense of everyone else). take your pick...
"cooperative economics" (i'll just call it communism, because, let's be honest, that's exactly what it is) is inferior to capitalism because it fails to encourage competition or give people the incentive to work. in capitalism, a person must work hard, pursue higher education and improve the quality of his labor if he is to secure a quality life because there are others who are competing for the same position/s. in communism, there is no competition, and because of that, people have no incentive to improve the quality of their labor, which means people will only do the bare minimum, if they cannot outright drop out of the workforce to leech off of welfare. this is why every single socialist country that has ever existed had a stagnant economy and no innovation other than that forced by the government. considering how socialism is still somewhat meritocratic (e.g. labor vouchers and the whole "to each according to his contribution" thing), communism would've been even worse (and i can hardly think of something worse than tens of millions of dead as a consequence of famines). communism and socialism are also inferior to capitalism in the field of innovation and price regulation. in capitalism, different companies have to compete for the same pool of customers, who ultimately choose the winner, which gives them the incentive to improve the quality of their product and lower their prices, which, ultimately, benefits both the consumers, who get the superior product for a cheaper price, and the company, which gets more money. communism and socialism fail here by removing competition from the picture either by bailing out inferior companies or by having them cooperate with each other. because of that, companies can get away with making lower-quality products out of inferior materials and selling them at a higher price, which is ultimately bad for the consumers, and the country as a whole. this is the exact reason why even the superpowers such as china and the ussr lagged, at the very least, a decade behind the west technologically during the cold war (yes, these countries were socialist, but the same thing applies to communism, to a larger degree), and this was during wartime, when their governments artificially provided the incentive to innovate.
finally, here's a graph tracking the GDP of china between 1952 and 2005 with all the capitalist reforms marked on it with their respective dates: 828cloud.files.wordpress.com/2013/01/c130118b.gif
@@voltagedrop5899 Oh yeah, cool story bro.
I guess cooperatives don't exist?
@trufiend138 Yeet!
Clarification please:
At 0:27 outcome distributions are fully based on productivity
At 2:02 outcome distributions are completely random
What am I missing?
Thanks
The observation at 0:27 is where a tiny distribution of people are responsible for almost all the output.
THe observation at 2:02 is where completely random outcomes can still lead to a single winner.
I think you're missing a lot.
@@teerificbitch Please educate me. At 0.27 the tiny number of people who are very wealthy are said to achieve that by virtue of their productivity relative to people farther down the curve. Yet, at 2:02 Dr. Peterson indicates that these skewed distributions occur due to chance alone. I am a fan of Dr. Peterson, but would like to understand what I am missing. thx.
@NxtLight Design the question is can you still play the game if you have 0 euro's. (althaugh he didn't say that)
there is a possibillity that you lose 100 times sequentially. when the two man play infinite rounds then that sequence will eventually come up. this ensures one of the 2 ends up having nothing left to trade thus the game ends for him. (then you go on to the next person). it is a random selection were the selection stops under certain conditions.
It is because the rich understand how money works.
It's because the rich know how to produce goods and services that people are VOLUNTARILY willing to hand over money in exchange for those goods and services.
@@adamantium2012 Tell me about how you voluntarily pay for food, toilet paper, water etc.
@@valentindfl431 So you think any toilet paper producer will automatically become rich? You voluntarily select the brand and which store to go to...
@@adamantium2012 Bullshit. The rich manipulate society in such a way so that their products go from want to need.
Whether it's psychological so as to appear that you are not complete or less then if you do not have the lastest product (fashion, decor) or by structuring the system so that one cannot survive or get ahead without it (cars, smart phones, computers).
Few things are "voluntary" these days. Billions of dollars spent on advertising and lobbying by corporations has seen to that.
@@mbogucki1 In the end its the customers fault for turning a want into a need. Envy.
It correlates productivity with capital.
is there a Pareto distribution regarding non creative works such as general labor?
So a thousand people flip a coin and the losers trade their money to the winner and eventually you get the 20/80 divide. By just sheer luck a few people will end up with everything and most will end up with nothing. Because the more you accumulate the more bad luck and random flips of the coin you can bear to weather to return back the average distribution of random coin flips which would mean an offset to your earlier losses. As you climb higher into the random 20% the smaller your chances of cascading failures become until the mathematical probability of it approaches zero. If you started off and had average or below average luck on the coin flips your small amount of resources means that any one single failure will either leave you with nothing or close to it.
everyone starts with 1 dollar, 50% drop out and 50% are left with 2 dollars,
50-50
another flip
50% of the 2 now has 1 dollar or 3 dollars
another flip
half of the 1's drop out, half of the 1's move to 2, half of 3 moves to 2 and half moves to 4
62.5-37.5
another flip
half of 1 drop out or move up, half of 2 drop down or move up, half of 3 drops down or moves up and same for 4's
68.7-31.2
another flip
half of 1, half of 2, half of 3 and half of 4 and half of 5
72.6-27.4 out of which only 3% would have made it to 5 dollars
only 1.5% will make it to 6
only .75% will make it to 7 out of 1000 participants it's likely only 1 person would make it to that point
and so on
with enough flips you'll eventually reach the 80-20 distribution. That is the point in which the change in percentages becomes so small that eventually the game more or less just locks up with the 20% remainder just moving up and down in their positions as they have accumulated enough resources to weather any outlier number of bad flips in a row.
Nothing about the Pareto distribution address or even touches on productivity as Peterson falsely believes. It's a mathematical model for how resources continuously accumulate into a smaller and smaller minority of people through pure chaotic random chance. We all like to think how clever and productive we are but the mathematics of Pareto's Distribution is a proof that all the wealth we credit to 'success' is proven mathematically to be no more statistically meaningful then what pure blind luck would dictate this wealth distribution would be. It requires you to look at economics logically and without all the warm fuzzy emotions you attribute to the idea of 'hard work'. Because the vast majority of the world works hard everyday producing the vast majority of the resources and services that fuel the lavish luxurious standards of living for a very tiny minority that isn't anymore productive then the average person.
Can anyone explain the maths behind the random trades aspect of this video. If a group of people have 100 dollars and "trade" against one another by flipping a coin, why would it end up in the scenario stated, that one person comes out with all the money.
It didn't make sense to me in the first place so I came to the comments to find an answer. I think it has to do with that if you trade and reach 0 you're out of the game and you can't trade anymore.
Longer explanation by @TheRiiiight:
So a thousand people flip a coin and the losers trade their money to the winner and eventually you get the 20/80 divide. By just sheer luck a few people will end up with everything and most will end up with nothing. Because the more you accumulate the more bad luck and random flips of the coin you can bear to weather to return back the average distribution of random coin flips which would mean an offset to your earlier losses. As you climb higher into the random 20% the smaller your chances of cascading failures become until the mathematical probability of it approaches zero. If you started off and had average or below average luck on the coin flips your small amount of resources means that any one single failure will either leave you with nothing or close to it.
everyone starts with 1 dollar, 50% drop out and 50% are left with 2 dollars,
50-50
another flip
50% of the 2 now has 1 dollar or 3 dollars
another flip
half of the 1's drop out, half of the 1's move to 2, half of 3 moves to 2 and half moves to 4
62.5-37.5
another flip
half of 1 drop out or move up, half of 2 drop down or move up, half of 3 drops down or moves up and same for 4's
68.7-31.2
another flip
half of 1, half of 2, half of 3 and half of 4 and half of 5
72.6-27.4 out of which only 3% would have made it to 5 dollars
only 1.5% will make it to 6
only .75% will make it to 7 out of 1000 participants it's likely only 1 person would make it to that point
and so on
with enough flips you'll eventually reach the 80-20 distribution. That is the point in which the change in percentages becomes so small that eventually the game more or less just locks up with the 20% remainder just moving up and down in their positions as they have accumulated enough resources to weather any outlier number of bad flips in a row.
Nothing about the Pareto distribution address or even touches on productivity as Peterson falsely believes. It's a mathematical model for how resources continuously accumulate into a smaller and smaller minority of people through pure chaotic random chance. We all like to think how clever and productive we are but the mathematics of Pareto's Distribution is a proof that all the wealth we credit to 'success' is proven mathematically to be no more statistically meaningful then what pure blind luck would dictate this wealth distribution would be. It requires you to look at economics logically and without all the warm fuzzy emotions you attribute to the idea of 'hard work'. Because the vast majority of the world works hard everyday producing the vast majority of the resources and services that fuel the lavish luxurious standards of living for a very tiny minority that isn't anymore productive then the average person.
So I just watched the video and I also got confused about the math around it. I decided to create a little page that simulates the scenario Dr. Peterson suggests and looks like he is right.
You guys the page I created here: playground.mntbllr.dev/pareto.php
Don't enter extremely high numbers to simulate stuff tho, hahaha I created this page in like 5 minutes and it will definitely break with huge simulations.
@@BrunoMontibeller Nice page, I did something similar and I got similar results. Is it possible to see the code ? just out of curiosity
@@pablopaliza I don't think Peterson "falsely believes" the Pareto distribution has to do with productivity. That law works in a simulated environment where each interaction is random. However the real world interactions are not random, perhaps some people are just more geared to winning so they will shoot up. It seems like his main point is that this is a natural principal (same with the Matthew principle) one that you cannot blame on an economic system.
@@BrunoMontibeller thanks for that! It seems like he's right, you have to keep increasing the trades but it's inevitable to eventually reach one person getting everything. Interesting.
Arguably, since some people are born with or not intelligence ,, bad parenting,self drive with motivation combined with inherited health issues! How can they over come?
The difference between Monopoly, the game and real life monopoly is, the board game is by chance. In real life, it's by design.
The difference, between you and I, is that I know how to use my punctuation properly.
The whole point that JP was making in the video was that it _isn't_ by design
That there are fundamental statistical trends that become inevitable in any given system, and haven't been solved for yet
@@347Jimmy Would it be inevitable that the same people would win a game of chance, over and over again?
@@scott-o3345 only if they were born white.
@@gerardjones7881
You mean, only if they have an unfair advantage?
This is notparticular to whites, but everyone who could afford proper higher education. Everyone who's born into a lineage of wealth, or everyone who's strongly connected to and can gain favour from people in higher authorities..
Whites might be leading in these categories, but every other race is close behind... so yes, not particular to whites.
Many people today are science deniers and confuse objective science with subjective social policy. Of course a select few have always dragged the human species forward no matter how hard the masses try to resist. Without the standout individuals, we would not have the modern technological, medical, scientific and democratic wonderland we all enjoy today.
But many seek to flatten the intelligence and production curve by forcing equity of outcome policies. No matter how well-intended, chopping off our tallest achievers to equalize all people into steady and even mediocrity will have dire consequences for everybody in society, especially for those near the bottom.
I know a million people who need to see this
It is almost impossible to challenge anything that Jordan Peterson talks about. I’m a huge fan of his work and Ive listened to every video on youtube I could find. I’ve bought both books and even the self authoring courses.
So far the this the only subject that needs addressing. Income inequality I thoroughly understand the Pareto Principle.
Understanding the principle still doesn’t do anything to the issue that if capitalism continues on this trajectory it will only create a further divide of the haves and have nots.
As I understand it one of America’s most fundamental principles was to maintain a system that would prevent a ruling class that kept the majority of its citizens as tax slaves.
Where I think most people miss the mark is that the high taxes pre Reagan-omics 70-90% of the ultra rich where NOT put in place to fund government programs.
The reason you put high taxes on those individuals was to incentivize the individual or corporations to willingly redistribute the wealth that was created by the citizens that ultimately created the wealth in the first place. This is why Unions became the backbone of the american worker. There are very few Billions that end up using their riches for the betterment of the citizens that helped create the wealth in the first place.
I would love to see America adopt some of the Business Co-op principles found in Germany where a person on the board is not aloud to make not then 8x that of their lowest paid workers.
.the Pareto Distribution is something else.
"The Pareto principle or "80-20 rule" stating that 80% of outcomes are due to 20% of causes was named in honour of Pareto, but the concepts are distinct, and only Pareto distributions with shape value (α) of log45 ≈ 1.16 precisely reflect it."
Peterson is talking about the Pareto Principle
What does this mean ? This means if you give everything, you will most likely be the only one within a good measure. Thus you can achieve almost anything.
The monopoly game analogy is how monopolies are created, however, it is not an example of free market capitalism, but an example of centrallyu planned government. Why? when you roll the dice, you do not land in a free market, you cannot choose where you stay, that is selected for you by the dice (Government regulation, like Oamacare or soviet era housing), those who control the businesses favored by the dice are always the beneficiaries. The free market is the answer to this problem, since when given the choice, most people would never stay at Boardwalk or park place, and because of this, the owners would have to lower their prices to compete with their lower priced competitors. This is a perfect example of why the most regulated businesses in the US, have become markets dominated and divided by only 5 or 6 giant corporate conglomerates. the American media is a perfect example. over 90 percent of all media, including broadcast media, newspapers, magazines, and publishers, are divided between only 6 companies, and that number is always getting smaller with every merger.
Wait, according to the pareto distribution, if you have one worker, he does 50% of the work?
Depends on the size of the worker population.
Square root of one is one
So if you have one worker, they do 100% of the work
@@347Jimmy No, pareto distribution says that a square root number of the workers do 50 percent of the work. square root of one is one, and so that means the entire population of workers does 50 percent of the work.
@@robertmorrison1657 if you thought you knew the answer, why bother asking?
As it turns out, JP isn't a mathematician and was using a rather simplified formula in his example
en.m.wikipedia.org/wiki/Pareto_distribution
Perhaps we both should have looked up the formula before trying to solve the equation, because we were both way off
@@347Jimmy At the time I thought it would be a sort of funny comment in it of itself.
This seems a wrong interpretation and use of the Pareto distribution by prof. Peterson. It's not production but capital accumulation (wealth appropriation if you will) what tends to a Pareto distribution. And coin tossing tend towards a uniform distribution. Or maybe I'm getting too much wrong. I need some references. Does someone have good ones?
I think he's just simply trying to say that you can find this distribution across almost ANYTHING. Rock stars, employees at any given work place, basketball players, classical musicians... So maybe it could be that technically it's not called a pareto distribution if it's not capital accumulation (I don't know, just saying "if"), but that patter still emerges almost everywhere.
With the coin tossing thing, while the total number of flips with heads or tails reaches infinity will be 50%, there are only limited resources. If we go play this game just between two people we just need enough consecutive flips for one person to lose all of their money. In an infinite random string this is bound to happen. Repeat this with more players and you will get the same result, eventually.
How about UBI?
The normal curve
I thumbed up for the thumbnail
For me, I don't care that some people have more than me, to account for human competents and variance compensation for ability systems will always be unequal due to most biological life forms that we of being so. Its more the recent problem (starting around 1970 in america to my knowlege, I could be wrong) that the wealth slope went from a relativly good slope to a regular slope than a sheer mountain, the same damn slope as feudalism and communism. It is a problem we can fix, but I have no idea what it is. The same abuses have been worse in the past but reached a breaking point where the elites realized that they were running out of things to steal and would lose everything if they kept doing so. Why hasn't that happened yet?
once you have a critical mass of cash, provided you dont blow it on things that are stupid like fancy cars, yachts, and blow, you will simply come to a surplus you have no problem putting into investments. as a poor person putting a few bucks into an investment is unheard of because you need every scrap to survive and tolerate your existence. but when you run a surplus you can really make it multiply.
2:05 Not quite, in monopoly, one person ends up with all the money, but in real life, one person ends up with most of the money, which is a big difference, there is wealth to be created in the real world, not a fixed number of properties.
is it the cause of men end results a lack of effort or a lack of execution in its ideas?
Is this just a consequence of the nature of what is being distributed? Like if you talk about what one animal actually needs there’s only so much he can hoard or mates to mate with. But if you create a system that allows for accumulation of abstract things like money then that predo distribution is logged.
What if money was non-linear, or linear up to $1 million then it was taxed exponentially so that it would be harder and harder to get higher and higher effectively capping money and expanding the tax revenue that could be used to fix climate change and provide UBI to offset the massive rise in automation.
The only problem is that we no longer reward those highly productive people. People whose ancestors were highly productive now control the funding for these people, and the employment of these people and they pay them equally to all the other workers, either because they believe this is "Fair", or because they wish to exploit them, for their own gain.
So nowadays most of these highly productive people give up in disgust and don't produce anything.
What's the solution to this problem then? How can one attempt to be in the highly productive people rather than being in the place where we basically are , producing neatly nothing to show or provide value to the world. Because this is true, everything we're doing ( the general population ) just happens to effect only our life or just maybe a few people around us but never more than that and that's the reason we can't compare ourselves to these people whose work effects millions of people around the world. So consiquentally they end up with the most wealth or power.
Probably a stupid statement but could we not just construct a monetary overflow were when a certain limit is reached in a persons total wealth the excess funds overflow back into national infrastructure and development projects?
That's sort of like another way of saying "tax at 100% above a certain threshold"
If you tax the rich too hard, they go abroad, or at least send their money there, so it ends up being counterproductive
It worked pretty well in the past when rich people couldn't up and leave the country on tax exile or wire money offshore so easily
A bit simplistic. One, as pointed out before, tax is an arbitrage game for the wealthy. Tax high here, and they move there. And a city or country loses all that tax revenue. Second, you really need to incentivise people to work. Unfortunately with your system, it’s a simple transfer of wealth from the wealthy to the not so wealthy. Not sure if people think about that enough. Effectively you are stealing the productivity dividends from those whose labor the market values, to those whose labor the markets doesn’t reward well. The solution has to be more sustainable and needs to involve a certain responsibility on behalf of the individual to make the right choices.
Wealth can be created out of thin air, which i think JP overlooked. If there was a finite supply of it, then everything he said would be spot on. The game monopoly, as well his coinflip example, has a limited supply of cash (yes theres 'debt' you can accrue, but its essentially a countdown to the end of you in the game), is based on chance, and whos fundamental strategy is to acquire everything you can get your hands on. A far cry from a presentation of economic systems.
Yes wealth can be created, if you disagree with this point your opinion is wrong and youve never touched an economics book. The fact we have countries today whos GDP is worth billions of dollars, while the super states of old (say, roman empire) had GDPs of approx $500 dollars per capita
Think on that. You making minimum wage would have been able to on your way to buy the entire roman empire. Youre welcome - Capitalism
Your theory is right, but your numbers are way off. For starters, nothing you could buy for $500 today is worth the entire Roman Empire. Ceaser wouldn't trade the Empire for a few hundred loaves of bread, or a couch, or even an a iPhone or TV.
@@DJ_Force ooof. Youre right. I meant to write per capita. Fixed
It sounds like a kind of organic programming design
One thing that Jordan don't take in equation is that peoples work itself is a good. So actually noone ever can't end up with nothing at all. People, in worst case scenario, end up with nothing but time to sell and get money for that. Also economy is not a 0 sum game. Of course I don't deny pathology of this, but so far we didn't get anything better.
The Monopoly game example was not accurate since the game is intended to end that way.
So it Capitalism
@@hector5749 🤣🤣🤣🤣🤣
The original rules to the game of monopoly were changed so that the game would produce one winner. Change the tax rules so that the super rich pay a wealth tax and the gap between the rich and poor will narrow. Turning billionaires into millionaires will still follow the math so no natural laws will be broken but the gap between rich and poor will be much smaller.
The coin toss is a randomised game. Wealth concentration in the top 1% isn't random, if you know how to make money well you're allowed to get rich nothing stops you
When those at the top have the ear of congress, while all others don't, it makes the rules of the game change by whatever means necessary to favor them at all times.
This is so true I played Monopoly with my dad and sister growing up and he always won 😂 we always got to the end of the game. He won every time. I could teach you the strategy but then…
Vault Tec?
A lot of it is also down to spending. The poor buy what the rich sell. The Kennedy family made its money selling alcohol. The poor bought alcohol but didn't sell it. Picasso got rich buy selling his art. The poor looked at his work but didn't buy or sell it.
Hate when a video doesn't reach the actual conclusion... makes me think but no resolution to the thought process
Plus the minimum wage.
Now, in late 2020, he's about to become Professor Nostradamus.
Monopolies are dangerous. We need to see a resurgence of small businesses
You can't force it tho, that never works. The market is free and competence oriented for a reason.
So we are where we are because that’s just a natural consequence..... 😊😂🤦♂️😂😊
War ! Only a few soldiers fight at the front the rest (us) supply them with the means to kill.
YNWA ❤✊❤✊❤
Those who have much. Much is expected. Those who have little. Little is expected. The Bible has told us about this paradox forever and it has not changed. Must be in Man's nature to be greedy and want everything.
And latestage capitalism is like being born into the very end of a monopoly game. This needs to change if we are to have any hope of revitalizing a real free market
random trading = creative production, got it.
Also does not allow for criminals
It’s a conundrum, that The bible has tried to address
Jubilee ("Year of Release") deals largely with land, property, and property rights. According to Leviticus, slaves and prisoners would be freed, debts would be forgiven, and the mercies of God would be particularly manifest. Leviticus 25:8-13 yet, I don’t think it ever worked. Bolsheviks tried to redistribute the land, only to see it get accumulated again in a few hands.
That led to kolkhoz were the peasants became de facto slaves.
The only practical solution is when rich go bankrupt, or inevitably degenerate into a pitiful mess, then the property is naturally redistributed by changing hands.
Who here thinks it should be illegal to be a communist or socialist in the western world. That and that schools and that includes universities must teach all students about every nation that has gone for the socialist's / commie system . Show those that are about 12 and up very graphic photo's and video's of the killings that each and every one of the govs. that went that route did.
I know how........
Count nit my family
At 2:05 you are basically argueing aganst my Highschool mathteachers fundamental hypothesis of stochastics (they claim, that, in your given example, everyone will (in the long term) get the same amount of money); I definitely don`t want to say you are wrong, but I`d like to understand how/why your idea is working/not wrong; I would really appreciate if someone, takes the time to answer my question. :) Thx in advance for taking your time.
I hope I don’t have this wrong and even your question right (I’m not Jordan Peterson). The reason that one person will end up with all the money in the described random trading game is that one by one people will hit zero and thus are not able to further participate.
I think in real life it has more to do with how intelligent people are, how much they consume and how much effort they put into making money.
It should be no surprise that highly intelligent people who spend little but work their ass off to make more money, finally end up having a lot more money than stupid people who don't like to work but only like to spend and spend.
It's because the system is unstable for any individual as long as you have money, and totally stable when you run out of money. Eventually any system that can achieve stable state, will come to that stable state. This system can reach the stable state, although it needs many many many unlikely events, it will eventually reach it, because it can.
I cannot make a mathematical proof because I'm programmer and not mathematician. So I created a quick Python simulation to try this out:
repl.it/M6Ob/0
(repl.it is a site that runs code in their virtual machines, it's trustworthy site, just look it up on Google)
The code will print out situation report whenever someone drops out. There's always a one winner.
I didn't include the coin toss there because there's a 50% change to get a random transfer from A to B as it's to B to A, which is the same as 50/50 coin toss.
And there is only 20 traders, because 100 traders would take like few minutes to reach the end.
You can play around with the code, try to see how many random transactions it takes to reach stability etc.
If you set million people in this game with million dollars each, it would take years to reach the stability, even with thousands of transactions per second :)
Here's the Python source:
#TradingSimulator
from random import randint
def print_situation(group):
for i in range(len(group)):
print(str(i) + " amount:" + str(group[i].balance))
class Trader:
def __init__(self):
self.balance = 100
def deposit(self, amount):
self.balance += amount
def withdraw(self, amount):
self.balance -= amount
def transfer_to(self, other, amount):
if (self.balance >= amount):
self.withdraw(amount)
other.deposit(amount)
group = []
for _ in range(20):
group.append(Trader())
print("Start situation:")
print_situation(group)
while(1):
a = randint(0, len(group)-1)
b = randint(0, len(group)-1)
group[a].transfer_to(group[b], 1)
if group[b].balance == 0:
print("Number " + str(b) + " Dropped out in this situation:")
print_situation(group)
group.pop(b)
elif group[a].balance == 0:
print("Number " + str(a) + " Dropped out in this situation:")
print_situation(group)
group.pop(a)
if len(group) < 2:
print("All done, one takes it all!")
print_situation(group)
break
RealationGames, I only get like half of the code (as my last true coding experience is nearly 20 years ago
with Pascal or something :) - but the output seems spot on to what Dr. Peterson describes as the trading game. And it’s fun to try out a few times even with the inevitable end. It's awesome, thanks!
A person who has better skills and is highly inteligent will end up with more money, which necessarly means that people with low skills and low inteligence end up with less to no money.
Dude you're so material.
In the past we shuffeld down money by wars as an example
need to clean my room
was hoping he came in as the monopoly man for Halloween or something :(
Jordan Peterson monopoly guy lol Jordan made me more comfortable with what I have because it's just nature that some have more and some have less. Overall I have so much and I'm ok.
Who hates lectures from famous artist about success?
i admire JP for some reasons and totally disagree with him about others. This one he is way off. The creative production of an individual does not make them wealthy. Knowing how to use the system and how money works makes you wealthy. Aside from that, there are many ways to generate wealth but the system is designed to prevent the poor from accumulating it. Banks and employers punish you for being poor. The education system, the propaganda system and the legal system deliberately work against the poor. If your family is not already wealthy, there are road blocks set up to trick you into screwing up. And the poor think that they are street smart. They are known as useful idiots to the ruling class.
A few players score the most points.
People have worked out how to fix inequality in the short term. Violence. Why don't we just put a limit on personal wealth?
Because it would be totalitarian
@@laius6047 sure mate. So you'd rather a system where private banks create money and essential services are private monopolies. Maybe you should leave the comments to people who think.
@@vincentmangiafico Who gets to decide the limit? You're going to have fights over that.
@@melc900 it doesn't seem to be that hard on agreeing on a tax rate for workers.
@@vincentmangiafico someone's personal wealth isn't a static or absolute value. If someone has their wealth in stocks, that's constantly in flux. If someone owns valuable artefacts/art pieces/jewelry, the amount they are worth will vary depending on who you ask due to independent valuation of the items they own. Same for the property market, where a house is only worth what it eventually sells for. Not to mention changes in conversion rates between different currencies. Constantly trying to work out everyone's wealth to determine if it passes a given number would be impractical, and is quite different to taxing an income which is a numeric value.
I didn't knew inheritance counts as productivity...
Some productivity would of been needed to create and maintain the wealth then it must be their decision want happens to that wealth. Burn it or pass it onto their offspring, it must be their choice in a fair non-coercive society.
this is the the same as the zipf paradox vsauce made a video about it
this guy is full of it. he used hockey players as an example. 2019-20 regular season in the nhl there are 900 players so square root of 900 is 30. he is saying 30 players should produce half of all the goals in the nhl. the 30 top goal scorers produced 1050 goals total. the 31st best through the 150th best goal scorer produced 2340 goals. the 151st best scorer to the 710th best scorer produced 3920 goals. so in this case the total goals is 7310 and the 30 best players produced 1050 of those goals so they account for 1/7th of all goals no half like he claims they should.
Weren`t Karl Marx and Friedrich not exploring these kinds of mindsets?