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Inequality and the Power Law

I'm not sure I understand your argument.

Are you saying that it is good and expected that wealth and power exists in the hands of the few because most people are incompetent? Are you presenting this as proof that the Paris Hiltons of the world are more intelligent, more competent, and harder-working and therefore the inequality of our society is justified?
 
What makes you think Paris Hilton is so stupid? Yeah, she was born with a silver spoon in her mouth, but she played her hand well and greatly increased her wealth. She hired a publicist to basically make her famous. The fact that she comes off as a rich spoiled bitch is probably part of her stick.

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If so, all I can say is "wow."


Notice my OP said, "one part of the puzzle".
 
What makes you think Paris Hilton is so stupid? Yeah, she was born with a silver spoon in her mouth, but she played her hand well and greatly increased her wealth. She hired a publicist to basically make her famous. The fact that she comes off as a rich spoiled bitch is probably part of her stick.

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If so, all I can say is "wow."


Notice my OP said, "one part of the puzzle".

If, as you desire, we establish a permanent overclass, you will certainly number among the peasantry. Is making decisions for yourself so tiresome that you desire an aristocracy to rule over you? Are you unaware of the fact that what you regard as the ideal society is precisely the kind of society most of our ancestors fled? Yeah, the old school aristocrats had excuses just as lame as the ones you're offering for why they deserved to have all the wealth and all the political power, while the vast majority deserved only poverty and subjugation.

I can understand rich people wanting to recreate the same sorts of feudal societies our ancestors fled. What I can't understand is your desire to do so. Have you somehow constructed a fantasy in which you magically join the aristocracy just before the door slams completely shut?
 
Calm down Underseer. I not advocating a feudal aristocracy.

Here is one study that contradicts the power law of preformance. Looking for others on any side of the question.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2238126
Abstract:
It has recently been proposed that individual job performance follows a power law distribution (O’Boyle & Aguinis, 2012). We present an argument and evidence for why the conclusion does not follow from the premises. We discuss the nature of generating mechanisms of statistical distributions, and compare the normal, log-normal, and Pareto distributions. We review statistically principled methods of testing power-law distributions, and point out how it is necessary to compare them to a plausible alternative distribution (Clauset, Shalizi, & Newman, 2009). We reiterate the importance of testing the assumptions of statistical models, and review the methods that are available to organizational researchers when the norm of normality is violated.
 
Oh brother.
They took extremely non-representative sample of highly specialized experts at a task who only represent the tail end of the bell curve distribution in the population, then to their moronic surprise, they found that the tail of a bell curve in isolation does not itself look like a bell curve.
Look at this image from the article:
power-law.jpg


Look at the black line representing the bell curve and only focus on the right hand 25% of that curve. What does it look like? It looks like the Paretian distribution shown in gray. They took specialized experts like MLB players that already exclude the lower 80% of the bell curve, so no shit that what is left only looks like the top 20% of the curve which resembles of power function.
 
Its like they're intentionally trying to mislead us into believing inequality is mathematically justified. We've come a long day from the days when they said the peasants were descendants of Ham and deserved their fate.
 
Its like they're intentionally trying to mislead us into believing inequality is mathematically justified. We've come a long day from the days when they said the peasants were descendants of Ham and deserved their fate.

The best way to model performance is one question. The best way to distribute resources is another. The first doesn't have to justify inequality but it might help explain it.
 
Oh brother.
They took extremely non-representative sample of highly specialized experts at a task who only represent the tail end of the bell curve distribution in the population, then to their moronic surprise, they found that the tail of a bell curve in isolation does not itself look like a bell curve.
Look at this image from the article:
power-law.jpg


Look at the black line representing the bell curve and only focus on the right hand 25% of that curve. What does it look like? It looks like the Paretian distribution shown in gray. They took specialized experts like MLB players that already exclude the lower 80% of the bell curve, so no shit that what is left only looks like the top 20% of the curve which resembles of power function.

I don't think they're making that blunder.

To the eye the curves look similar but the bell curve clumps people a lot more than the chopped-off Paretian curve. I believe that's what they are saying they see in the data.

And I strongly suspect that at least the errors do follow a Paretian distribution. Consider the common thing that most people consider themselves to be above-average drivers. Is that really mass self-delusion or is there some truth in this?

How does one evaluate their driving skill? Compare the oopses you make to the oopses you see other drivers make. If you make fewer than the other drivers you think you're above average. Lets try some curves and see what happens. You have 100 drivers, you're actually #50 on the list.

Everyone is actually equal: You'll see you're doing about the same.

Linear scale (top guy makes 1, bottom guy makes 100.) There will be 5000 mistakes, you'll commit 50, again, you'll see you're in the middle.

Bell curve: Again, you'll see you're in the middle.

Something like a Paretian distribution: While I don't have the formula handy to come up with numbers just looking at the graph above shows that the guy at #50 makes fewer errors than he encounters.

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Its like they're intentionally trying to mislead us into believing inequality is mathematically justified. We've come a long day from the days when they said the peasants were descendants of Ham and deserved their fate.

I don't see any attempt to mislead. They are just presenting information, ranting against facts doesn't make them go away.
 
I don't think they're making that blunder.

They quite clear are making that "blunder". All of their samples include only the highly specialized experts at a particular task. For any task on which performance is takes the form of a Bell curve, if you only sample the people who perform at the top end of the distribution (which is what all their studies do), then you will inherently get a Paretian distribution for your specialized sub-sample.

Its like they're intentionally trying to mislead us into believing inequality is mathematically justified. We've come a long day from the days when they said the peasants were descendants of Ham and deserved their fate.

I don't see any attempt to mislead. They are just presenting information, ranting against facts doesn't make them go away.

They are presenting information about extreme, non-representative sub-samples as though they are information about the population in general. Thus, they are inferring falsehoods using such blatant errors in reasoning, that it is implausible that they are accidental errors rather than deliberate efforts to mislead.
 
Most people assume the performance follows a Gaussian distribution. I'd argue the there is decent evidence that this is not true. Preformance tends to follow a Paretian distribution. http://www.businessinsider.com/new-...human-performance-fits-on-a-bell-curve-2012-5

I'd argue that this one part of the inequality puzzle.

How so? The paper claims to be measuring performance, not ability. Performance following a Paretian distribution says something about how society is organised, not about how people act. For example, take academic paper publication. If you identify a particularly prolific author, and shoot him, would there be fewer publications next year, or the same? Unless you think that some publications would suddenly fold without their favourite contributor, it seems obvious that the same number would be published. Which means that what the distribution is showing is not that publishable ideas are concentrated in a few people, but rather that the system is geared up to reward the already sucessful with greater recognition.

Which may indeed give a clue as to why there is such blatent inequality in the world, but is hardly the conclusion your sources were citing.

Taking a step back, the explanation I give above fits better with previously discovered phenomena. For example, I'm far more likely to get published than most, being wealthy, white, highly articulate, and with the 'right' sort of background. The same methodology would doubtless reveal that success follows a Pareto distribution around these traits, but there's no suggestion that these are a measure of ability.
 
They quite clear are making that "blunder". All of their samples include only the highly specialized experts at a particular task. For any task on which performance is takes the form of a Bell curve, if you only sample the people who perform at the top end of the distribution (which is what all their studies do), then you will inherently get a Paretian distribution for your specialized sub-sample.

I disagree. The tails of the Paretian and bell curves have a different shape.

They are presenting information about extreme, non-representative sub-samples as though they are information about the population in general. Thus, they are inferring falsehoods using such blatant errors in reasoning, that it is implausible that they are accidental errors rather than deliberate efforts to mislead.

They are using the tail because everyone in the group is highly trained--we are seeing their limits without having it cluttered up by people who haven't fully developed their ability. (For example, how I play chess. I could do better than I do but that would move it out of the realm of fun. Thus I do not do things like memorize openings.)
 
How so? The paper claims to be measuring performance, not ability. Performance following a Paretian distribution says something about how society is organised, not about how people act. For example, take academic paper publication. If you identify a particularly prolific author, and shoot him, would there be fewer publications next year, or the same? Unless you think that some publications would suddenly fold without their favourite contributor, it seems obvious that the same number would be published. Which means that what the distribution is showing is not that publishable ideas are concentrated in a few people, but rather that the system is geared up to reward the already sucessful with greater recognition.

Your conclusion does not follow.

Lets put it in a different realm where it's clearer. Al-Qaeda hits the All-Star game, a bunch of top players are killed.

Does that magically make the remainder move up in ability? Or does it mean we will see less good play next year?



Or for that matter lets take a real world decapitation event: China in the cultural revolution. Mao sent the successful people to the labor camps because they were obviously exploiting everyone else as evidenced by their success.

Mao's policies resulted in megadeaths because the competent people weren't keeping things going. If you ended up in the OR it would be an intern wielding the scalpel. My wife's appendectomy scar shows the difference.
 
I don't see why all natural processes must have a single bell curve to their ENTIRE distribution. Take height, for example. (Leaving aside different environments) Let's say that there are 5 genes that strongly, and independently influence height.

Then for each allele of each gene you will have a bell curve contribution. That is a lot of possible bell curve composites.

But some curve of single one-to-one correspondences in nature may not be a bell curve at all. A bell curve comes from a full independence of variables of what comes next not being influenced by what is happening now. Or of an area not being influenced by its surroundings.

I should study non bell curves, I no nothing about them. Following a derivation would be interesting.

The visual/physical derivation of the bell curve is cool too. The math is a bastard!



The "birds of feather" aspect of human interaction alone, will tell you that we are not just balls on a peg board.
 
What makes you think Paris Hilton is so stupid? Yeah, she was born with a silver spoon in her mouth, but she played her hand well and greatly increased her wealth. She hired a publicist to basically make her famous. The fact that she comes off as a rich spoiled bitch is probably part of her stick.

You're kind of just proving the point there. She's hired *other* people to do the smart stuff *for* her. Any idiot with money can hire people smarter but poorer than them to do the thinking stuff. That's kind of the whole rich man's thing; hire smarter people to do all the work; then take credit.
 
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