"Assuming that rich people is richer because society decides that their time is more valuable, they can create more value in the same amount of times of some other poorer people."
are you fucking kidding me? why would you assume that?
are you fucking kidding me? why would you assume that?
In theory there's no difference between theory and practice. In practice, there is.
No, that's a person with "high hourly earned income".
Making wealth is not the only way to get rich. For most of human history it has not even been the most common. Until a few centuries ago, the main sources of wealth were mines, slaves and serfs, land, and cattle, and the only ways to acquire these rapidly were by inheritance, marriage, conquest, or confiscation. Naturally wealth had a bad reputation. - Paul Graham
As for the "bad reputation", given that most things that were written and otherwise arrived to us were composed by people of some means at least (excluding monks, etc. which are harder to classify by modern standards) - really poor folks had high illiteracy rates, little spare time to create records that we could read, and not many people that cared for their opinions enough to create permanent record of them. So, given that, how exactly Paul Graham knows what reputation the wealth had amongst folks who weren't wealthy?
So I think it's an enormous error to confuse wealth with creating lots of value per hour. Wealthy just means you control a lot of capital.
[1] http://www.cnbc.com/id/49167533#
[2] http://www.forbes.com/sites/erincarlyle/2013/09/18/how-self-...
>>> And when I look around at the rich people I'm familiar with
Anecdote is not data. I don't know where you live, but depending on it and your social circle, the minuscule number (compared to the whole nation) of people you can observe personally would be very different.
>>> Often it was a right-place, right-time thing.
It was. So what? Nobody claims billionaires are superhuman. The claim is only they deliver (or delivered) value. Did they come into position of being able to deliver the value by luck? Maybe. So what? If you per chance found a deposit of gold or discovered very valuable technology - they fact chance played role in it does not change the price of gold or the usability of technology.
>>> If Bill Gates had been born 50 years earlier, for example, it's hard to imagine him becoming a zillionaire.
Sure, so that guy everybody mentions would be called "John Walles" instead, it's no different.
So maybe you should read all the way to the the last line of my post, which explains my exact point: someone currently being a billionaire doesn't mean that they will make the world much better if they spend an hour on one thing versus another.
Ergo, kourt's point stands: somebody being wealthy is not any sort of proof that they can create more value per hour. Which is the (wrong) notion that NhanN was promoting.
If you're going to jump into a conversation in the middle, please try to pay attention to what's going on. It's frustrating to have to connect the dots for you.
It's not a proof, but it's higher probability, by the virtue that in majority of cases being reach means producing value (at least in the past, as your own links prove) - and if the person produced a lot of value in the past, there's a big chance he'll continue doing that. As for the question if it makes the world better - it's a very subjective matter, everybody has their own "better". I think it'd be better if Uber would disrupt taxi cartels, but taxi cartels and medallion investors think it'd be worse.
>>> It's frustrating to have to connect the dots for you.
That may be because the dots are connected by non-sequiturs. E.g., the question if somebody was lucky or not bears no relation to the question if he produces or ever produced value. A quote of how one could rapidly become rich three hundred years ago has little connection to how the majority of rich people slowly become rich now. Etc, etc.
> That may be because the dots are connected by non-sequiturs.
That you don't understand something doesn't mean it doesn't make sense.
You seem to be going out of your way here to be an argumentative dick, so unless you've got some actual contribution to make, I think you've passed my tolerance for JGGIFT discussion.
The assumption of a rich person being rich because of the value created may sound plausible, but is empirically falsified for at least the USA and Germany. Statistically, a rich person is rich because she inherited.
Here: http://www.forbes.com/sites/moneybuilder/2012/04/20/most-wea... it says only 6% of wealthy people are wealthy by inheritance.
Here: http://blogs.wsj.com/wealth/2008/01/14/the-decline-of-inheri... they arrive at the same conclusion (minority got wealthy by inheritance).
The forbes article you quoted is a bit problematic because the data given are voluntary answers. In studies like these there always is the problem of a potentially skewed return rate: Given a return rate of 30%, what is the wealth inheritance quota of the other 70%? My speculation would be that someone who is proud of the fruit of his own hard work (the quoted local business owner) is more likely to answer such a survey. On the other hand some rich person who found a clever way to unofficially inherit parts of the own wealth while avoiding the correlating taxes won't answer such a survey.
At least the second of the blogs.wsj.com studies is self-selected, too. I couldn't find the papers for the two other quotes because the sources were too vague.
It's better to use data sources like tax income of states. IMHO even better is the concept of social mobility (the wikipedia article is quite good: http://en.wikipedia.org/wiki/Social_mobility), as it also encompasses factors like the parents' social contacts and educational chances. The studies cited there all use official, non-self-selected data and sometimes even proper longitudinal studies. In the results presented there the USA has the the lowest intergenerational vertical social mobility of all researched OECD countries (i.v.s.m. means the probability of a child to get into a higher (or lower) class than its parents live in).
An example for Germany: The probability of a child of workers to get a degree from a university is 17 times lower than that of a child with academic parents (source: http://www.deutschlandfunk.de/geschlossene-gesellschaft-uber...).
Yes, social mobility is not the same as inherited wealth, because it's a result of a combination of inheritance and other factors. On the plus side, the empirical data it's based on is of comparibly high quality. The problem is that monetary (as opposed to social etc.) wealth is pretty hard to measure even given government data. In Germany for example the data for people having income is more or less 100% available. But the richer you are, the less probable it is for you to have income: The money then comes from capital gains, rent etc. These are way harder to measure, e.g. the capital gains could get collected by a corporation and not an individual. The corporations money only gets tapped on demand (=saved inside the corporation hull until retirement). And the child of the owner has a counsulting contract with that company. Legally, thats not inheritance at all, but practically it pretty much is.
If our example rich person does absolutely nothing except put their money in a bank, and yet earns more per hour in interest payments than our poor person, that rich person is still creating more value in the same amount of time.
Like I said, this is just the theory. One reason why we should never allow ourselves to be governed by economists ;)
I just wanted to highlight the theory that a sufficiently rich person sitting on their arse picking their nose is (in economic theory) generating more economic value than (for instance) a medical professional saving people's lives all day.
I first bumped into the absurdity of this when working on a coding contract in 1998. The project was doomed and would never complete let alone achieve its goals, we all knew it, but we'd all turn up, write our middle-layer business functions according to the project plan, and got paid a fortune for it because Y2K had pushed prices up. I met a nurse who had spent her day elbow-deep in other people's misfortune and was earning about 1/10th of what I was. The stark comparison made me rethink a lot of economics 101.
That would also provide you a lot of tax revenue for improving education and social services. Or you could just pay it out as a negative income tax or a basic income.
That wouldn't solve every problem of capitalism, but so what? No improvement makes everything perfect, but that's not a reason to argue against improvements.
[1] e.g.: http://www.forbes.com/sites/ashleaebeling/2012/12/11/buffet-...
We could just do it but we have far more savings than the majority of the uk population.
Parking spot is a commodity. And just like other commodity in life, everyone values it differently. What's wrong in letting people paying for what they think it's worth for? The rich will always have advantage in buying commodity, and that's a fundamental issue in our society, but that's an entirely separate problem to fix, and the solution isn't telling people to stop producing commodity.
In this specific case of parking lot, it's bad either way because a private company is skimming profit from public space.
its not at all an entirely separate problem to fix. society should not be structured so that rich people are always, fundamentally advantaged in every dimension. we should not commoditize everything.
restaurant reservations are not a public benefit, and I think its fine to commoditize them IF AND ONLY IF it can be done in a way that is fair to the restaurants and the customers. we shouldn't tolerate a service that is based on lying to restaurants.