Logical Limits To Bubbles | 51 comments (51 topical, 0 editorial, 0 hidden)

Re: "... hands of the luckiest ..." (none / 0)

Even in a world of moral paragons a free market system will end up concentrating wealth in the hands of the lucky.

Even the real world, being an evil shit is not enough to get wealthy. You have to be lucky.

by Colman (colman at eurotrib.com) on Thu Oct 16th, 2008 at 08:57:45 AM EST
[ Parent ]

Has someone already tested your model in a computer or by some dice rolling scheme? I'd like to see the data on this one.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:02:36 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Anecdotal evidence: I've been an evil shit all my life, and look where it's got me.

Signed: Unlucky Jim

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Oct 16th, 2008 at 09:05:42 AM EST
[ Parent ]

Re: Interesting. (none / 1)

Morning/afternoon afew.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:07:32 AM EST
[ Parent ]

Re: Interesting. (none / 0)

There was some work done I read about, but I lost the reference after I saw it and have never been able to find it.

by Colman (colman at eurotrib.com) on Thu Oct 16th, 2008 at 09:12:25 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Maybe we should try to recreate your scenario here at ET. Might be doable. What do you think? Generate our own data. See what it looks like.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:22:23 AM EST
[ Parent ]

Re: Interesting. (none / 0)

<paging Migeru> Where's the previous thread on this? Any ideas?

Actually, I wouldn't mind modelling that.

by Colman (colman at eurotrib.com) on Thu Oct 16th, 2008 at 09:25:34 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Far fucking out! Let's do it!

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:31:21 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Look at the Bak/Sneppen model.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Oct 16th, 2008 at 09:36:56 AM EST
[ Parent ]

Re: I LOVE IT (none / 0)

when you talk DIRTY! MORE! MORE! :)

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:40:09 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Why?

by Colman (colman at eurotrib.com) on Thu Oct 16th, 2008 at 09:40:14 AM EST
[ Parent ]

Re: Interesting. (none / 0)

What exactly is it we're trying to model?

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Oct 16th, 2008 at 09:43:58 AM EST
[ Parent ]

Re: Interesting. (none / 0)

Just one thing. Let's make sure we're not reinventing the wheel. Someone should do a library search to see what's already been done in this area. Doesn't mean we won't do our bit. It's always good to learn from others' mistakes.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:34:31 AM EST
[ Parent ]

Re: Interesting. (none / 0)

You're the weirdest scoutmaster I ever came across ;-)

You can't be me, I'm taken

by Sven Triloqvist on Fri Oct 17th, 2008 at 04:13:15 PM EST
[ Parent ]

Re: "... hands of the luckiest ..." (none / 1)

Define "free market system".

All you need really is a game of chance in which the more you have to play with the more profitable bets you have access to. And I think that's a feature of any fair game of chance because it has more to do with things like gambler's ruin than it has to do with the specifics of the game being played.

In probability theory, the term sometimes refers to the fact that a gambler will almost certainly go broke in the long run against an opponent with much more money, even if the opponent's advantage on each turn is small or zero.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Oct 16th, 2008 at 09:48:41 AM EST
[ Parent ]

Re: I'm going for my walk. (none / 0)

Back in a couple hours. Let me know if you and Colman want to continue.

I'm IN!

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 09:53:43 AM EST
[ Parent ]

Re: I'm going for my walk. (4.00 / 2)

Assume a collection of agents taking actions with uncertain payoffs.

Assume the average payoff is 103% (allowing for economic growth) and that the payoff distribution extends down to 0% (ruin).

Assume the agents can place more distinct bets the more money they have. (Assuming a nonzero smallest bet size suffices)

Then the wealthier players can diversify their variance away and capture the 103%. The less wealthy players cannot and are more likely to go bust.

If the average payoff is less than 100% so the game is a loss to players, and you must play, it is known that diversification doesn't work because you want to have sufficient variance to be able to have payoffs about 100% some of the time.

Is that it? The proofs are left as an exercise for the (bored) reader.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Oct 16th, 2008 at 10:15:07 AM EST
[ Parent ]

Re: ANSWER (none / 0)

Nope. I have other ideas. Will explain later but this is looking like the germ for a computerized game for kids/adults. Are there such things already on the market?

More later. Have to hit the sack, rest my back (I'm a budding poet).

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Thu Oct 16th, 2008 at 12:17:12 PM EST
[ Parent ]

Re: "... hands of the luckiest ..." (4.00 / 2)

Sometime in mid to late '70s Psychology Today had an article by an aspiring business psychologist on the attitudes towards the role that luck had played in the success of executives and managers in Fortune 500 businesses. All I recall is the conclusion: out of all those surveyed not one attributed any significant role in their success to luck . They all credited merit and hard work! What this demonstrated was that there was a powerful consensus that was very successfully conveyed to all newcomers that, in corporate America, success was due to ability and hard work and that the role of luck was to be vigorously denied if one were to "fit in." The problem with studies on such matters is one of obtaining access to a representative sample of that population while retaining sufficient independence to provide any integrity to the survey.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Oct 16th, 2008 at 10:24:43 AM EST
[ Parent ]

Re: "... hands of the luckiest ..." (none / 0)

Luck undermines their right to keep all the winnings to themselves.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith

by Migeru (migeru at eurotrib dot com) on Thu Oct 16th, 2008 at 03:43:27 PM EST
[ Parent ]

Re: "... hands of the luckiest ..." (none / 0)

I remember that article- I may be able to find the original research.
Anecdotally, I grew up in a community of "self-made men", and I remember not one among them -the parents of my friends, the advisers and parents of my scouting buddies, associates of my father (a history teacher) who ever admitted that luck played any role in their worldly success. Yet the plain fact that inherited status and money played a huge role was powerfully apparent.

I did it. So "they" can too. If "they" weren't lazy/stupid/black/catholic/jewish/-------

Poor = defective, for these rich men from Upper Arlington, Ohio.

Capitalism searches out the darkest corners of human potential, and mainlines them.

by geezer in Paris (risico at wanadoo(flypoop)fr) on Thu Oct 16th, 2008 at 11:53:38 PM EST
[ Parent ]

Logical Limits To Bubbles | 51 comments (51 topical, 0 editorial, 0 hidden)

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