Pareto Distribution & Price's Law | Dr. Jordan Peterson
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- Опубликовано: 11 июн 2024
- zenandtheartoftrading.com/
In this lecture Dr. Jordan B. Peterson explains the Pareto Distribution and Price's Law in relation to creative output and financial success.
I believe this statistical phenomenon helps to explain the extremely high failure rate among traders. Over 95% of traders fail to make money, while a select few seem to be able to consistently beat the market.
I believe the Pareto Distribution is responsible for these statistics, particularly among retail traders. The fact is that some traders put in more work, are more cognitively skilled and more naturally talented at trading than others - and since trading the markets is a skill-based zero-sum game, they end up making all the money while the masses lose out.
Original Video: • 2017 Personality 21: B...
#JordanPeterson #Productivity #Performance
I'm in the military and have been working with healthcare professionals during the pandemic. I've worked with hundreds of soldiers and hundreds of nurses and doctors. And I can confirm from experience that pareto's distribution of 80% of work being done by 20% of staff is absolutely, unarguably true
I stupidly brought this up when asking for a job, it wasn't for means of income, just to have something to do, WHEW did that not go over well. Needless to say, I didn't get a call.
@@newguy3588 damn lol
a world champion in sports does a simple task like a janitor but gets paid a lot more than the world champion of all janitors.
Peterson speaking vomit again.
Most people seek national independence or personal independence hoping to avoid the nature of capitalism.
Looking at Capitalism, all employees can be aggregated into one Employee and all owners can be aggregated into one Owner.
The aggregated Employee invents and makes the products then sells the products to itself and then pays a fee called Profit to an 'Owner' for the permission to own the same products the aggregated Employee itself made and sold to itself.
Ownership is a claim, not effort. The Owner makes the claim, then the Employee enters to protect and grow what has been claimed as owned by the Owner. All efforts are done by the aggregated Employee, the aggregated Owner just owns, nothing else, no effort what-so-ever.
@@reasonerenlightened2456 .. Ownership is a claim too???? a concept! and ideological product which may be material. the effort the owner claims is to that. the aggregate employee contributes nothing in creating the idea but barters his labour for it. The owner can go around trading to each employee - who is also the customer - these ideas for unit value individually and be limited to constraints and reach, only so much by his efforts. or he can conscript a few and deliver the product of value to many. each giving a piece of his labour,energy,money for it. The flaw in capitalism is that the profit is passed to the children of the owner. the children who did not contribute effort in creating the idea but shares in its legacy. with the same permission to own and command conscripts to carry out the efforts. this is where we becomes trapped by the nature of capitalism as you put it. however people dont seek to become independent or personal independence as we may conclude. everything that a person thinks he or she is, is really an image outputted by someone else that they wants to buy into. People seek to lose independence for group cohesion and identification in functional groups. so counter-intuitively we seek the opposite of independence.
@@barrytelesford5265
All efforts are done by the employee.
The Owner makes no effort because ownership is a claim, not effort.
Even the ideas are effort done by the employee.
Oh Jordan Peterson if only you knew that one day your RUclips psychology lectures that people listen to would occupy a Pareto like distribution of all RUclips psychology lectures.
😂😂😂
True
Nice
Price's law is why big companies have departments. By splitting the company into different functional groups you reduce the number of people working in any one group. The downside is the increased need for management in each department.
Very true never thought about it like this
20% of the departments do 80% of the work still 😂
@@nuggetx4086 More like 20% in each department does 80% of that department's work. The manufacturing department can't do accounting for example.
But this also creates inefficiency because every department is looking out for its own interests against the interests of the other departments. Often most of what takes up a CEOs and a COOs time is mediating the conflicts between departments, but they're often so high up in the hierarchy that it becomes unlikely they will notice problems before they start hurting the bottom line.
@@Benjumanjo Dealing with people, some inefficiency is inevitable, but the hierarchical model seems to work best for most large companies. They have tried to flatten this by reducing the number of managerial levels with mixed results. It makes for less promotional opportunities for good employees which often hurts morale and gives bad managers too much power. It's a balancing act.
I brought this up when applying for a manager position. I was passed over despite quality credentials because the panel thought my management style would be too “harsh” since I mentioned Price’s Law.
During an Interview, if you mention Price's Law, I think its important to frame it as identifying the Superstars and the Role Players as Complimentary of each other. Lebron James may produce 40% of the teams output, but he can't Win the Game by himself. But at the same time, you don't treat Lebron James like you would the Role Players. Knowing the differences between your employees absolutely matters.
You didn't get the job because you are stupid. It's that simple. You are the 20 percent. However, it's the bottom 20 percent that is referred to as a functioning idiot
Gotta love exponential distributions.
good one
actually a power-law distribution
since the exponent is a negative fraction
Yes, so what I do is hire, hire constantly, reward the productive, let go the deadwood, repeat, repeat, results are you keep and reward the great ones, you have a very happy and prosperous organization. The trouble is that people move, people move, people die, get old, retire. I’m 74 still extremely active, i’’l drop or get run over by a truck. But I love what I do and have more than I can ever get done. So I keep increasing my fees?? By the way, I’ve hit Zero several times..So I got up, started all over....
I look at this from a government standpoint. Let's say you are mandated to have X number of employees. You will inevitably wind up with some half baked employees when your quest is to put x number of warm bodies in chairs. Corporate, and government, dictations fuel this model of productivity.
This is so very important to understand
I find Price's Law enlightening and compelling:
In a company of 256 people, 16 produce half the output.
- This makes sense, as the execs plus a few stellar employees from each department will carry half the load.
In a company of 16, 4 produce half.
- This not only makes sense, it precisely aligns with my current company.
In a company 4, 2 produce half.
- This also makes sense, as you will have the leader doing 40% and the other 3 doing 30%, 20%, and 10% respectively.
Those positive feedback loops make absolute sense to explain why those who have much get so much more and why those who have little, even what little they have - lose.
Learning this is so important
That animation was so cool!
So that's why a Monopoly game always ends!
Everything ends.. Everybody dies ( Dr. House)
@@rishi2791 But leftist SJWs never lie
Jordan Peterson is stupid.
Trade (transactions) inevitably lead to extreme levels of wealth concentration. Jordan Peterson does know that.
And then there is World Series of POKER
@@reasonerenlightened2456 and trade is the only opportunity for the less skilled to gradually get more and more, even though at a very slower pace compared to the more skilled
Thank you for this. The longer you play the market with a PROVEN STRATEGY the better your odds. SIMPLE. VIRTUES are always key - perseverence, patience, humility, courage.
Jordan Peterson is exceptionally stupid-like.
Trade (transactions) inevitably lead to extreme levels of wealth concentration. Jordan Peterson does know that.
You won't know it's 'proven' until it's too late. JP's simulation of the transition from Normal to Pareto distribution 'proves' that time in the market eventually leads to ruin for the vast majority. i.e. the opposite of your conclusion.
Not all of those supposed virtues are 'proven stratgies'. Humility is slavish and peasantlike, perseverance can be misguided, courage is often a mask for ambition, and patience is a vague and meaningless word. The only true virtue is the persuit of excellence, anything else is a prison you have chosen to lock yourself in because you fear freedom.
the simulation literally shows that only a tiny percentage of individuals can feasibly attain a high amount of wealth, and that the vast majority end up with little to no wealth.
The longer you play the market as a man with average wealth, the worse your odds get.
Pareto created this distribution in the first place to highlight the unfairness of wealth distribution in Italy at the time, and since then it's only gotten worse. Don't be a slave to the capitalist mindset that it's a fair system, the pareto distribution shows that inputs don't always correlate to proportional outputs, in other words working super hard won't result in lots of money.
@@davidcarter8269 I agree 100%. With a great deal of education (which there is no education in stocks formally and that which exists you have to dig to find the good stuff) you can beat the market and the pareto principle works for you.
Why does this video have so few views? It's more important than any celebrity.
@Sentinel I'm confused by your post. Peterson is a classical liberal, by his own statement. But he is against communism.
@Sentinel his future authoring program made me aware of my sleeping disorder, which I then fixed - best $14 ever.
As one deviates from the median, the risk of each trade is lower if you are on the positive side or includes greater risk if one is below the median. Also, each game of Monopoly starts with a large portion of the result of the previous game.
Brutall truths.
My work is learning this rule the hard way right now...total brain drain due to our engineers leaving for more freedom loving companies and states, I'll be joining them soon. This reminds me of the vision of economics Ayn Rand was portraying in Atlas Shrugged.
Can you believe it that there are people who may just sit on their ass and listen Dr. Peterson lecture an hour after hour after hour LIVE!
Jordan Peterson pops up everywhere
Nice
Word.
As a super beginner building my foundation, I would love a video companion to this of you assessing the key takeaways/meanings/application. You're very talented at articulation and breaking it down. This def went over my head however, that's the game :) I will continue to study and grasp as I go
Trade (transactions) inevitably lead to extreme levels of wealth concentration. Jordan Peterson does know that.
@@reasonerenlightened2456 why do you keep commenting this?
@@pineapplehead789
Why are you not commenting the same?
Someone compiled all of his lectures and converted it to MP3 format. Just in case JP gets removed from YooToob. Can't recall where I got it from, but I'm sure it's not hard to find.
What you're asking for is the Bible
The obvious answer then is to consistently engage in creative effort...
The more you create the higher on the pareto distribution you will be.
Because, by the Pareto distribution, the square root of all that you create will be of significant value.
I've done an analysis of student work in groups, and not only does the 20/80 rule prove true, but about 3% of students do far more than 97% of students.
so, the 80/20 does hold if 3% do far more than the 95 ?
When the index alpha, in the pareto distribution' is about 1.16 only then you have 20/80 rule.
Otherwise suck it.
What was your index alpha?
@@reasonerenlightened2456 I consider the 80/20 rule to be a metaphor, i.e., the least do the most work. Why not 79/21? Because it is a metaphor, a heuristic, not a concrete statistical claim.
@@jamesj9744 I am not sure if it will be published but I can send the data and my analysis if you would like. You can simply do some metrics of activity amongst your students and you'll see the same thing. I have a game that automatically indicates how many times they log in, access key components, how long they are on, how many decisions they make... There are analytics associated with lot's of online platforms as well.
@@williamcolucci4369
Here are some non-metaphors Peterson's brain gets fried when exposed to them:
1) The market is a battlefield. Profit is King. There is no such thing as a battle that never ends and a battle that never has a clear dominant force to take over all others.
2) The markets concentrate Wealth. Therefore it is essential to have a mechanism for re-distribution of wealth.
3) Looking at Capitalism, all employees can be aggregated into one Employee and all owners can be aggregated into one Owner.
The aggregated Employee invents and makes the products then sells the products to itself and then pays a fee called Profit to an 'Owner' for the permission to own the same products the aggregated Employee itself made and sold to itself. The Owner is a parasite.
Ownership is a claim, not effort. The Owner makes the claim, then the Employee enters to protect and grow what has been claimed as owned by the Owner. All efforts are done by the aggregated Employee, the aggregated Owner just owns, nothing else, no effort whatsoever.
4) Therefore, either the free market will make you poor or the Owner will.....unless the owned Wealth is being perpetually redistributed as I describe here.
5) A poor person is forced to think about how to make "bread" using a patch of land and some tools, a Wealthy person thinks about which farm and bread factory to purchase.
(But the 'really poor' have no other choice except to think about rebellion or theft or how to lend themselves to others in exchange for "bread".)
Perpetual re-distribution of sufficient Wealth will eliminate the 'really poor' by giving them a choice to say 'NO' to unfair demands on their time and efforts. It would also elevate the poor to think about 'prosperity' instead of 'survival'.
6) Also, we must have laws to enforce strict border control for wealth leaving an economic area (town, city, state, country) and people entering an economic area.
THE ONLY SOLUTION: Tax ownership of wealth Exponentially and then distribute it evenly among all citizens , again and again, in perpetuity. (The government should not be excluded from taxation of owned or controlled Wealth thus making it irrelevant what is private and what is public. )
!!!
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If "hierarchies dispossess" then 'Redistribute' to make them less prominent. The solution is Obvious. ... but not for Peterson.
@@reasonerenlightened2456 that all sounded great right up to the point where you explained your "only solution". We cannot trust a government to overseas this redistribution. It turns the inequality of Rich versus poor to people versus government. We have seen this tried over and over again and failed over and over again. There has to be a different solution.
From my understanding of Shannon entropy (H), the initial uniform distribution is the maximum possible state of entropy, as all agents have an equal likelihood of predictability. Yet, your model increases to Gaussian, then power law.
Wow, you used a bunch of words to say nothing of substance. You fail
anyone knows how to make that animation used by dr peterson ?
Thanks from Australia, good Buddy.
Mate*
Too powerful
Hi Prof! Great work!
ANYWAYS isn't a word!
obvious at first, but I never thought about it at that deep level :)
true, i remember it states in the bible, those who have everything will be given everything, those who have nothing will be taken away from everything.... is that a warning for all of us to share, right? Jesus was against posession too, no? And one should not `bury his talents under the ground`, so you should happily develop your talents to the full and share the fruits with all of the community. Very simple, to me
Dummy here.. can someone breakdown on how to read the graph properly? Thanks in advance.
12:19 anything you can assign monetary value is something you can measure
I wonder. At my last job, as a welder, it seemed everyone was pulling their weight. Maybe I just wasn't paying attention enough. We welded in a warehouse, overhead cranes and I did my part, welded this an that constantly. I wonder if my output was miniscule and I was part of that large percent that was doing not much. If price's law was going on at the warehouse then I simply did not look around enough to notice the looking busy work.
That’s probably why that company is in business. Other companies have gone bust because they don’t understand this.
Welding is not a creative work
How does the mean of pareto distribution comes out to be infinity ?
It is mind blowing that there are students whose primary job is to sit on their ass and listen Dr. Peterson. Man, are they not lucky! I wonder if they understand to appreciate that enough.
So thats why Warren Buffet says to dont lose money because losing money gets you on a money losing feedback loop, while if you dont lose money even if you gain a little it gets you to a earning more money feedback loop.
Always interesting and often informative. Liked this one. So Price's suggests that accumulate personal wealth is mostly statistics and a huge pinch of luck? For some reasons I am reminded the Country of Venezuela as that Country, despite being endlessly waist deep in oil and natural gas, is also endlessly destitute. The political pundits in the US and on late night more pointedly say that Venezuela has those issues as Venezuela is a strong believer in and strong practitioner of socialism. Leading to the obvious conclusion that governments that are in the know might avoid socialism as if their country's' existence dependents on that said avoid. The mechanism seems to be that countrys always "run out of stuff to give away." Looking at other governments of other times, Rome for instance also failed as they 'ran out.' Looking in detail at the Roman Empire one can observed that that government of those times was basically a thief that robbed. And it too eventually 'ran out' as there were no more countries wealthy enough to steal from. Imagine that. As such behaviors are common in history one might think that governments and the people to support or vote or acquis to these sorts of governments are one degree or another are self destructive. Can one also imagine that too?
Does this seem to suggest that, in order to get the maximum efficiency out of people, you should organize them into smaller groups?
Or does the rule not apply in small groups? Id like to know how this rule was created what its limits are.
For example, in a family of 1kid and 2 parents, according to price's law the square root of 3 should be doing 50 percent of the work, that means ruffly 2 people, so is the kid doing the other 50?
Eru Kun you’re specifically picking a family(for a group of people) which has a very skewed physical and mental power distribution that’s not very random, but predictable(kids are almost always going to have less power to do work, than the adults). Also randomly allowing a floor and ceil function in your judgement of the Pareto principle’s merit is not a good idea. In the real world it’s meant to model large data sets where rounding numbers have such a minuscule effect and won’t likely cause contradictory results, like in anything in statistics the phrase “on average” needs to be applied to the end of almost every sentence on average. ;D
@@SpiffyCheese2 oh ok
@@erukun3055, pick a group where all are doing the same work or have the same responsibilities. Three scientists, architects, lawyers. Families, even small ones cover a diverse range of activities.
I think smaller groups and maximum efficiency works with most things, not just people. Part of that is because smaller is easier to manage and management also has a key function in efficiency.
Price never studied the US government - cube root not square, if not 4th root.
lol
But government workers are *_not_* working in a "productive domain;" they are working in a destructive domain. America was founded on the principle that power tends to corrupt and absolute power corrupts absolutely. Too bad most congressmen rarely honored their Oath of Office. The 10th Amendment prohibits a huge federal government, but look where that got us.
Hear me you
Jordan Peterson and Mike Rowe
Cost-Benefit Analyses are of no use after ruin. - Taleb (9:00)
Mathew's Law 5:49
The monopoly comparison would work if the next game of Monopoly started with the results of the previous game. Those are the feedback loops. Winning pr dicts more winning. The coin flip comparison underestimates the power of this phenomenon because it really is random. Real life human interaction is never random and always depends on what each individual brings to the game.
How does creative production relate to tossing a coin for a dollar?
When you toss a coin something happens. When you trade, similar thing happens, you just trade and hope you will get the best deal and conclusion of the series of such games is that one person stacks up most(all) of the wealth. That's why monopoly doesn't last forever, and try not to confuse moral and business. Of course this does not apply to every human being, and you can be generous and still use this law in an non-Buddha generous way lol
When a action is taken a reaction happens.
Given time all actions and reactions will default into a 80/20 rule. The coin is just the most basic form of this, but it can be applied to more complex actions with detailed reactions.
Having the varying 1% lifts everyone while resulting in anger and resentment from the bottom 30%. We know a large amount of factors that cause it, but it should be up to people individually to seize life by the horns.
Dr. Peterson how about Nepotism and families that hoard wealth through generations how does pareto distribution apply to them, does that not create unfairness due to achievement not through personal abilities ?
I guess it’s just luck of being born in the rich family. But, how many in top 10 are heirs?
@@1Eagler That would be hard to tell since most wealthy people are not as public as Musk or Bezos.
No because if the one who gains the money is not in the 20% then they will begin to lose said money very quickly.
I would love someone to show this equation and how it relates to Twitter, Facebook, politics etc. It seems to me that suck a small percentage of people driving the narrative. And maybe the Democrats extrapolating the “woke” narrative they see on Twitter/ Facebook and why it is hurting them politically. Most Americans are in the middle but the fringe ideologies are the narrative the politicians run with because that’s the majority of what they are seeing? I wish I could communicate my thought better but I love this video great work!
en.wikipedia.org/wiki/1%25_rule
i'm not familiar with this law but i do know that when i did telemarketing and client services as i loved it i made the company at least 350K every month sometimes more but yet i only was paid 3-4k monthly, yet i have my own business now and not making these numbers, it interesting cause when i was there i rocked it and i loved it but yet it all on me now but yet the same motivation is missing, it not about the money it about something else, anyway can't explain cause i don't know
I loved monopoly as a child. It’s probably because I win most of the time 😁. You can’t cheat they say, but I know how to 😊
A person never truly possesses nothing. Even in the absence of material belongings, one still retains ownership of their own body-their most invaluable asset-over which they hold an absolute right. This form of possession is impervious to seizure; one cannot be robbed of their body, nor can they be subjected to murder or enslavement. Evaluating the worth of a human body proves challenging in a contemporary context where slavery is outlawed; however, its intrinsic value undoubtedly remains exceedingly significant.
So for companies to be productive they have to remove managers that have a disdain for prices law.
Zenarchist thanks for the spell check, FYI I didn’t have a job even before the virus lockdown, but I don’t see what the beef is as I’m referring to fuck head bosses that sack their best workers who need not be in the work place let to begin with and if your company fails because of it then good riddance to you, the world will be better of.
Is that an economic class?
2:12 For such an eloquent and intelligent man, it's funny to see his struggle with "much" lol
3:00 important
wait but this is under the assumption the scenario we're running is zero sum right?
Like for example the inputs of the scenario are determined at the onset... Which doesn't really correlate to real life directly imo..
Generational wealth is a zero sum game.
The same holds true in non zero sum, it just takes much longer, and possibly into infinity if the pie is always growing.
Yes because once a family gains wealth they never spend it to buy things resulting in it going back out into the world
They hoard it like goblins and eat dirt cookies and live in home made caves they dug by hand.
Turns out Ringo and George wrote half of the Beatles' songs.
So, what's the algo to ride that wave so I end up on the far left? :-)
I believe the answer is law of attraction
@@kajalmishra1366 you have an equation for that? :-)
Can some help me and point me to a video clip from JBP where he explains in very good detail how an alcoholic creates a world for themselves and manipulates people and sucks them into their world. I need to show it to someone that it's happening to but they can't see it because they believe everything this other person is telling them. Any help would be great ? does anyone know the video I'm talking about ? please help.
youtu.be/ 4cYuWLZI5kw
You could try this one?
I can‘t really confirm smarter people come up with right decisions faster.
How come COVID lethality shows pareto distribution? Would we not expect normal distribution around it‘s specific lethality value?
here’s an analysis with interesting mathematical evidence. What does this say about the „performance“ of the virus?
Looking forward to hear your explanations
www.celador.de/pub/Thanatophobia_SoC.pdf
Why would you expect a normal distribution when health outcomes are a pareto distribution more generally? Covid kills the sick. 5% of the population uses 50% or more of the health care resources because they are sickest. Some are sick because of a bad dice roll, most are sick because they make bad decisions. 20% of beer drinkers drink 80% of the beer and the same is true for nearly all consumption.
@@NickMart1985 A biological interaction must show normal distribution, and (95% of) the bell curve must be significantly higher than 0.
If you have countries without deaths, it confirms that the infection (alone) is harmless. It's the angst stress that varies.
And with more ppl dying, there is more fear, amplifying the stress, which is reflected in exponential charecteristics.
BTW: Most deaths are in countries which have dense healthcare infrastructure. If hospitals would help, this would be the other way around. But in hospitals the anxiety stress rises to maximum, and treating stress symptoms with weeks of intubation and propofol sedation kills exactly the same as we see dying.
Well the places with better health care keep people who should have died alive alot longer then normal.
The normal flu wouldn’t kill people starving in Africa because the people who would have been weak enough to died are already dead from something worse.
@@shadows-xn3ed That is not true. In fact, it's countries with high hospital density where most people die.
hm quantity of output doesnt necessarily equal quality of output
That’s why 80% only do 20% of the output 🤣
Hey
The one thing not accounted for when you use Pareto Distribution in economics is it doesn’t track where the money goes over time or more to the point what people do with their money and where it goes when it’s spent. Trickle down economics is an over simplification but there’s a point there.
you could look at it two ways in my opinion:
1. you could use trickle down and let business keep their profits and grow thereby hiring more employees who work to make their own money and pay the taxes. This tends to be good for society
or
2. you could tax the businesses and redistribute the money to the working class who will ultimately have to pay more for the products as well as less people being employed overall. This is not good for society
Both options eventually end up with the majority of the money eventually moving back into the hands to the minority. But I'd rather see a version where people earn what they have and more people are employed. This tends to be much better psychologically than unemployment or not earning your share
... also explains how or why much of history has happened in a specific way at a guess. This law assumes that there isn't a thumb on a scale, so to speak. So in effect you have a particular sort of inductive mathematical proof: You know within a reasonable degree of statistical certainty what must happen, and if it does not or is not happening (this is where the proof part comes in) then indeed there is a very heavy thumb somewhere around. So you can get excited or drink another beer. What? Not funny enough for you?
A.
B.
C.
A- Always
B- Be
C- Creating
'I've been thinking more about this Pareto distribution issue... it's... still difficult for me to understand. You see, I didn't really learn about this till about ten years ago' (7:21). Wonder how many people will admit that they're still finding it difficult to understand something they learned ten years beforehand. Has something to do also with having high standards of understanding.
Ask a Buddha about the Pareto distribution and He will, of course, explain that it takes place owing to the law of karma (which is greatly misunderstood among RUclipsrs).
2:32 that student was not putting attention in fact the square root of the cohort was doing something else according to his theory.
The Atlantic recently published articles about how husbands and wives divide household work. The split, generally, is 70% Wife 30 % husband.
Of course, the feminist might cry sexism. However, I was thinking about this in terms of Price's Law, which JBP constantly evokes.
Price's Law states that the square root of the number of people in a given domain generate 50% of the output.
So if you take √2 = 1.4142135
That means that in a team of two, 1.414235 people do 50% of the work.
If you take 1.414235 and divide by 2 you get 0.707106 which is 70%
So is the gendered imbalance of household labor a product of this economic law?
Sounds good but are you sure this is the right way to calculate it? The 1.4 stands for the number of ppl producing 50 % of the output , I don't think you can devide by 2 and get a percentage.
70 percent of what?
I really dont know if this rule should be trusted, i mean in a family of 3 people 1.7 do half the work, so it basically tells you that the parents do half the work, so that would mean that the kid does the other half?? Because in most cases he clearly doesnt
@@erukun3055 youre comparing apples with oranges.
My wife does ALL the work. Basta. (Hold my beer...)
no it's no economic law, it's just bad math on your part.
You have 1.41 people doing half the work and divide it by two and now 0.7 suddenly means 70% of the work? you can't just change units by dividing by 2.
He never plays the coin tossing example to the end....I don’t see how one person ends up with all the money
amount of people with 0 money increases all the time, which leads inevitably to situation on some point that 2 persons has all the money. Given infinite amount of time one will end up with all the money when they continue playing.
JP is in the sqrt of the sqrt of his domain.
Dont rely on luck.
Luck is when preparation meets opportunity... 😉
@@DanwilsonArchive Very true Daniel. A mentor of mine used to always say to people "you know it's funny, the harder I work and the more skills I develop, the luckier I seem to get!"
@@unapologeticskeptic4739 You weren't born in a 3rd world country which gave you the opportunity to get that education. Seems pretty lucky to me.
@@Meaty33 No I was not born in a 3rd world country. I think you meant to either say I was born in a western democracy - and had the opportunity to get that education, which I paid for myself not my parents or a trust fund, or I was born in a third world country and was not lucky enough to get that education. If you are trying to make me feel bad I never will I earned what I have. If you are in a third world country and want to place blame put it on your forefathers for not leaving wherever you are.
@@unapologeticskeptic4739 its still random chance of where youre born that presents the base set of opportunities.
Ignore these laws if you want to end up in ruin.
I once won 12 monopoly games in a row over Thanksgiving in the teller county jail in 2005 I think
So if you have 9 workers, 33% of them would produce 50% of the output and if you had 100 workers, 10% would produce 50% of the output? Doesn't make sense to me. It would seem to me there would be a fixed percentage of the workers producing a fixed percentage of the output.
They all don’t have the same work output or the same reasons for working.
A annoyed employee will work less then a happy one.
An employee going for a management position will work harder then the one who’s ok staying where he is.
Now consider only a third of ants are observed doing the work while Georgia Tech saw the same thing being most efficient in robots working in constrained spaces. It’s not that the third were better; it is that the system didn’t have space to work all.
I don’t think Dr. Peterson’t trading simulation supports a proposition that Pareto Distribution results from creativity, since trading on a coin flip negates creativity and choice. In this case, the Pareto Distribution results because negative values are forbidden. If players are allowed to go negative worth, there’s no stacking at zero, the distribution remains normal and flattens over time.
That may be true, but you can’t go below 0 if your are reading money…
Every one from Bayesian Statistics class also here 😂
Having said that inequality is inerent to our economy, that doesn't mean we should not try to redistribute the wealth to make things more equal even.
Inequality is not just inherent in our economy, it’s inherent in nature. Even if you redistribute wealth it would eventually redistribute back to the Pareto distribution.
5:21 - the majority of people have 0 creative output over their lifetime
Maaan, the bleeping COMMERCIALS are worse than day-time TV !!!
🎯 Key Takeaways for quick navigation:
01:09 🤔 Productivity follows the Pareto distribution, where a small number of individuals generate the majority of output.
04:57 📈 Pareto distribution emerges in trading games, resulting in wealth concentration where a single person ends up with all the money.
07:43 🎨 Creative output is not normally distributed and follows the Pareto distribution, with a large proportion of individuals scoring zero on creativity assessment.
09:22 💰 Zero can act as a barrier, making it difficult to start from nothing or recover from zero. A poverty trap can also hinder progress.
12:20 🧮 Pareto distribution may be a consequence of production being measured and social, as trade and monetary value assignation tend to exhibit zero-sum game characteristics.
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Did he really just try to not only explain but justify a given wealth distribution by showing how it can be generated by random interactions? I mean, set aside whether you think the currently existing distribution of wealth is fair or not, saying that the same distribution can be generated with a sufficiently large number of coin tosses doesn't exactly say anything more than that - the distribution you are talking about can be the result of a completely random process.
The Pareto Distribution isn't that hard to grasp if you only remember one thing. Yes, Creativity is relatively evenly distributed. Out of just about any group of 100 people, you can safely expect to see 100 creative ideas come out. But out of those 100 creative ideas, 70% are likely to have precisely zero actual value beyond the mental exercise of wondering what if. Of the 30% that do hold some genuine value, only a very few are viable.
Taken in terms of driving a truck (18 wheeler).
Just about anyone can learn to drive a truck.
BUT. Not everyone is suited for making a career of driving a truck.
For every 100 people who first start driving a truck. Only about 5% will still be driving a truck by the end of the first year.
For every 100 people whop are still driving a truck at the end of that first year. Only about 5% will still be driving a truck by the end of the fifth year.
Five years appears to be an effective cut off date. If a person has been driving a truck for 5 years, the odds are good they will continue driving until such time as they retire.
@Sentinel, there is no essence of humanity that is any better, or even any different than those wild animals you speak of. This is why Communism always fails. Because People are not ants. An ant will NEVER take more than it needs. An ant will also lay down its life without question to defend the Colony. Even against other Colonies of the same species of ant. While most if not all People will consistently take more than they need. Even going to quite some lengths to give themselves access and opportunity to more than they could possibly ever use (also known as wealth).
Communism is nothing but a crutch. An excuse. Born of Greed and Envy. Often fueled by laziness. You see what they have and you want it. But you do not want to work for and earn it like they did. So instead you ACCUSE them of some blanket moral wrongdoing. Which accusation then becomes your excuse for taking what they have, by force if need be. With the 'Promise' of then distributing the loot equitably. Of course you always take far more than you ever distribute. Provided of course you ever distribute any of it.
@Sentinel where is the contradiction? What have I said that is supposedly nonsense and HOW is it nonsense?
& this is why Marx's diagnosis of the problem was shallow
pretty sure the law is 80/20 and not 50/50
This doesn't work entirely. The examples he gives have too little variables. Trading a dollar at 50% chance might leave somebody with 0 after a few goes. But for example...
If there were 20 fighters, 2 teams of 10 fighters each and every fighter had to fight every other fighter at least once, some of the fights would end in a draw. Also what if a fighter who has lost a bunch of times beats a fighter that has won most of the time, that could either show rapid improvement from lower ranked guy, or lack of improvement from the winning fighter. SO in that case the cards could shift or not depending on why the fighter with the better record lost.
Think of a draw in a fight as co-operation or compromise amongst people in this this example. It's not that he is wrong about the bigger picture its more complicated than that. Because of moving pieces the only way to stay number one is to lie, cheat and steal especially when it comes to economics. Our world is the way it is because people simply aren't bothered enough by the state of life and don't care enough for their children to think about the state of life in the future. People are too lazy and cowardly to fight or argue against the vast majority of humans who are literally just too dumb to vote and pick politicians like they pick they're favorite WWE wrestlers. Who looks or talks the coolest. I get it though, what can you do against such wreckless retardation.
So basically, this is Jordan Peterson debunking trickle down.
Not necessarily
You realize he said Luck not meritocracy.
It should be noted. This applies to evolution. The difference is, zero is excitinction. How arrogantly special would you think you were if you pretend those who failed to survive never existed. That is religion and the religious.
So, Peterson claims that the vast majority of science output and wealth creation is done by a small proportion of people in accordance with pareto distribution. He also observes validity in heirarchy of competence. The former statement would seem to confirm the latter. But that being true, then the majority of people are neither very competent nor productive in comparison to the competent and productive. This suggests either most people have very little value to society, or for people to have an equal value the measure of productivity or wealth creation is not the correct measure of value. If people's value is intrinsic yet they have very little capacity to generate wealth or productivity, then to deny them wealth or the outputs of productivity would seem a rather cruel inevitable stratification between great wealth and mass poverty. This suggests rationally there needs to be a means of redistribution of the productivity and wealth from those that create it to those that are less capable. By Peterson's own assertions one can reason a socialist redistribution of wealth in place of the free market distribution which he holds in high regard.
Michelle Lewis, no, that's not how Politics work, because when you say that "...to deny them wealth or the outputs of productivity would seem a rather cruel inevitable stratification between great wealth and mass poverty. This suggests rationally there needs to be a means of redistribution...to those that are less capable." you appeal to Morality, and Politics is not about Morality, Politics is about Power, Money and Tribalism, and Power has its own rules. Power does not obey Morality, Power does not obey Ethics, nor Religion, nor Philosophy, nor Ideals like the Left or the Right, Power does not obey Justice, nor any Law or Constitution except its own Laws, The Laws of Power, because for Power, the end justifies the means, even when those means are always immoral, because the goal of Power is more Power, Money and Tribalism.
No it means 80% of people are almost completely useless and to give them something they didn’t earn makes the 20% they do produce null and void.
@@shadows-xn3ed You completely avoided the point. If 80% are inevitably unable to obtain their own means of living, in a society where that only comes from competence, you condemn 80% of people to poverty and suffering on a permanent basis, and do so by valuing productivity over intrinsic human life. It is a skewed value system. Perhaps we should execute these 80% useless? Can we do it with dramatically combed black hair with a little black moustache? Can we pleeeeeeaaase?
There are lots of non-creative jobs.
As the predictability of the RUclips algorithm increases, so does the square of the dumbness of their adverts.
Poverty - trap - why doesn't he support UBI if he recognizes a poverty trap?
Because he knows 80% of his audience are white male rightists who have been indoctrinated to hate it.
Because some people will abuse that outcome and people will still wind up with no money
@@SebastianMehenka Because a few people will not behave well, a great solution for a grand majority of people should be avoided. Isn't that letting the perfect get in the way of the possible?
@@SebastianMehenka Many already have no money. He doesn't support it because his $upporters don't want it.
If he understood UBI he'd support it.
UBI is only a floor to stop people from becoming homeless and to allow them to re-educate if need be. It is also meant to encourage people to work as now they won't just be slaving to fill their landlord's pockets.
@@williamcolucci447 What is “a few” by your definition?
Well the pareto principle destroys socialism as an ideology .Scientific socialism isn’t scientific at all at least if the pareto principle is true.
You just have to be an alpha male.
SJWs need to watch this.
Pseudo-science is alive and well.
Actually the parental thing is off by a little bit it's eighty-two per-cent of the difficulties are caused by 22% of the people. Everybody who jumps on this firetto thing just loves the fact that it adds up to 100. Except you're talking about two different groups so your percentages don't add up to anything he could have said 10% and 80% he could have said any two numbers and everybody would have latched onto that like an idiot. I've met plenty of people who swear by it and none of them ever actually counted up the results they just swear by that precise number. When I say a number it's more than a noise I did seven years and electrical engineering school.
Price's law questioned:
Price's square root law: Empirical validity and relation to Lotka's law
Author links open overlay panelPaul TravisNicholls
doi.org/10.1016/0306-4573(88)90049-0Get rights and content
Abstract
Price's well-known square root law states that half of the literature on a subject will be contributed by the square root of the total number of authors publishing in that area. Price's contention is treated here as a hypothesis and assessed against the evidence presented by both empirical and simulated author productivity distributions. The results do not support the square root hypothesis. The problem with Price's original claim is traced to its basis in Lotka's law, which is considered as an inverse square law rather than as a generalized model taking variable parameter values. Varying parameter values engender a family of related, but systematically different, distributions in which the nature of inequality in publication productivity, including the size and relative contribution of the most prolific subset of authors, also varies.
It's if citations are taken into account. Publications have become inflationary and mean nothing today.