Survivorship Bias • Hacker News Board

Re: Survivorship Bias

#181

Post by ux-app » Fri, Apr 21, 2017, 4:41 PM UTC

ryandrake wrote: post #172

ux-app wrote: post #166

Earlier quoted context omitted.

> I'll show you ten people who who attempted a safe boring white collar job, tried to run a local service business, or planned to save aggressively over decade, but did not achieve $1mm net worth For the purpose of this discussion that's irrelevant. As you yourself stated > [Survivorship bias is] about falsely attributing a causal relationship between the people's actions and their success Given that within a 50km ra…

You're talking 1% of Australia's population. But, hey, let's assume that counts as "common." What I'm hearing is "since outcome X is commonly found happening for people, then outcome X must be attributable to some action taken by those people." I'm not sure how you are concluding this. Cancer is common, too--much more common than becoming a millionaire. Is a cancer diagnosis attributable to someone's actions or is it…

> I'm not sure how you are concluding this.

1 in 100 Australians are in the millionaire club. By contrast winning the Powerball Lottery has odds of

76,767,600:1

To win Powerball you need "only" to match 7 numbers from a pool of 40 possible choices.

By contrast to become a millionaire you had to make 1000s of individual decisions along the way and yet every year approx 10,000 new millionaires join the ranks. How many Powerball winners are there per year? 1 maybe?

It may be comforting to think that luck plays a large part in people becoming rich, but logic dictates otherwise.

Re: Survivorship Bias

#182

Post by vog » Fri, Apr 21, 2017, 4:49 PM UTC

EduardoBautista wrote: post #143

ryandrake wrote: post #138

I had a professor who had the class stand up and all start flipping coins. If you flipped tails you sat down and stopped. After several iterations he interviewed the last remaining standing person to ask him what hard work he did to become such a good coin flipper, and if he had any secrets about coin flipping success he wanted to share with the class. It was a pretty nice exercise and I think applicable generally to…

That is a terrible example. That's implying that you can just sit on your ass all day and just watch TV and you have a 50% shot at success.

Why do you think so? The coin was flipped multiple (n) times, so the probability of total success is 0.5^n. For 10 coin flips, it is already less than 1/1000.

Alternatively, you can view it as a game that is repeated until one person is left. So the chance of success is 1/n where n is the number of people involved - independent of the random method chosen for selection (coin flip, rolling dices, or whatever).

Re: Survivorship Bias

#183

Post by alejohausner » Fri, Apr 21, 2017, 5:09 PM UTC

jacquesm wrote: post #31

backpropaganda wrote: post #26

Earlier quoted context omitted.

Peter Thiel isn't arguing for startups here, but arguing against the idea that the world is just coin flips and some people randomly end up with 10 heads. So your comment is mostly ad hominem.

He can only argue for that with a platform because he ended up with 10 heads. So no, it is not an ad hominem, it goes for anybody in that position, but also for Peter Thiel. What's the last time you met a poor person giving seminars on the world not just being coinflips? You can improve the odds by hard work and trying to grasp whatever opportunities come your way. But it would be a terrible mistake to assume that th…

> What's the last time you met a poor person giving seminars on the world not just being coinflips?

Well said. I think I'll add this to my .sig .

Re: Survivorship Bias

#184

Post by didibus » Fri, Apr 21, 2017, 5:10 PM UTC

jerf wrote: post #154

ryandrake wrote: post #144

Earlier quoted context omitted.

It's not about whether they're single-digit millionaires or billionaires. It's about falsely attributing a causal relationship between the people's actions and their success. It's about ignoring the counterfactual cases. What about the factory workers who also practiced prudent money management and did not end up millionaires? What about the many other dirt movers who worked just as hard but did not end up being the…

"What about the factory workers who also practiced prudent money management and did not end up millionaires?" Then he at least ended up better off than he would have if he had not practiced prudent money management. Anything else would require stretching the definition of "prudent" beyond anything that fits. It is a fallacy to believe all of life's outcomes are purely due to skill, one that will harm anyone who acts…

I don't think what you're saying holds correct. You're just applying survivorship bias at a smaller and therefore less obvious scale.

We do not know the amount of luck based causality versus non luck based. What we do know is the probability of ending up a millionaire vs not.

So say it's 10% millionaire. I'm pulling this out of my ars. Now the question becomes what non luck based actions were performed by the 10% of millionaire and not by the 90% of non millionaire that caused them to become the ones to end up millionaires.

That's not a trivial thing to answer. First, it's possible there exist no non luck based actions. Maybe all actions had an element of luck. Second, it's possible no single action had a majority role. So it becomes a sum of small actions.

Now, even if we assume the best case scenario. That is, there exist a single action which is 100% responsible and has no luck involved. Well, how did the 10% knew to do that and the 90% didn't? That's also luck,or a just as complicated question to answer.

Now say the survivors, aka, the 10% came and said the secret guaranteed to work action is X. It does not mean it is repeatable once there is already 10% millionaires. What if the 90% now all do that magic action, there is not enough money for 100% millionaire. So you can see that this action would not anymore suffice and therefore starts to have an element of luck again.

Re: Survivorship Bias

#185

Post by snerbles » Fri, Apr 21, 2017, 5:16 PM UTC

EduardoBautista wrote: post #149

6nf wrote: post #147

Earlier quoted context omitted.

You still have to flip the coin

A much better example would be to have all students run around a 400 meter track with some students having 1 - 100 meter head start.

Your racetrack analogies are deviating too far from the classroom example. If you want to model selective advantages, give one student additional coins to flip.

Re: Survivorship Bias

#186

Post by stdio_h » Fri, Apr 21, 2017, 5:22 PM UTC

Just saw this similar comic! http://smbc-comics.com/index.php?id=4283

Re: Survivorship Bias

#187

Post by treyfitty » Fri, Apr 21, 2017, 5:40 PM UTC

I grew up relatively poor (I think my parents were on welfare at one point, but they would never tell me). I studied hard in college, got a good job afterwards, and now enjoy a very middle class life, which is rare considering my many friends + acquaintances from the same upbringing are struggling. Relatively speaking, I am "successful" all because I studied hard.

The details in between are important in the discourse of luck. Growing up poor, I engaged in a lot of unethical behavior to acquire money. By some miracle, I got admitted into college (albeit a state school), and realizing this miracle, I dedicated my 4 years to pure studying with the belief that good grades -> good job. At the end of junior year, I questioned this logic- I had a 4.0 GPA, yet after 20 interviews, wasn't able to land an internship (which falsely led me to believe I was relegated out of the realm of "success"). Then, I digressed to my former self, and got in trouble with the law. During senior year, after 20 more interviews, couldn't land a full-time offer. Again, by luck, I somehow ended up landing a "prestigious" job. Years later, it was revealed to me that the hiring committee all but unanimously disagreed on my qualifications. One member read my senior thesis in full and, for some inexplicable reason, fought for me, and I ended up receiving 1/40 slots reserved for Ivy League grads.

Whereas the first paragraph suggests hard work pays off, the second paragraph screams "luck." Sometimes, the details are too long, where the key events suffice when giving a description of someone's path. I don't think people are trying to dupe listeners and self inflate their hard work when they make statements like the first paragraph- people just spare the details because it's really not directly relevant to the narrative.

Since my first job, I've interviewed for 70 different roles without success. While I get dejected at times, I understand the role of luck. I don't owe the details- I've earned my right to say I worked hard, but people can, and always do, aid in my luck. Without the awareness of this, I would've given up by now, but I just keep chopping. That's all there is to it when it comes to discussing luck.

Re: Survivorship Bias

#188

Post by ericrav » Fri, Apr 21, 2017, 5:41 PM UTC

ctdonath wrote: post #127

frgtpsswrdlame wrote: post #114

Earlier quoted context omitted.

>He's super smart, hard working and I'm sure that accounts for the majority of his success. Why are you sure? Social mobility in america is depressingly low right now. Our meritocracy is a meritocracy no more, if it ever was one.

The mobility is there for the taking, though disincentives are at an all-time high. Welfare benefits are structured (presumably unintentionally) to discourage working: earning about $12/hr plus welfare equals about $36/hr without welfare ... but in between, welfare benefits plummet so fast that trying to work your way up from $12/hr to $36/hr amounts to a huge pay cut. As such many can't or won't make the bridging ef…

Are you referring to the US? Since we don't have a federal cash welfare program[0], what welfare program are you talking about that gives recipients an additional $24/hr ($50,000 a year if working full time)?

[0]: https://fivethirtyeight.com/features/most-welfare-dollars-do...

Re: Survivorship Bias

#189

Post by taneq » Fri, Apr 21, 2017, 5:41 PM UTC

ux-app wrote: post #166

ryandrake wrote: post #161

Earlier quoted context omitted.

I think you're helping to make my point, so thanks! For every $1mm net worth person who chose a safe boring white collar job, ran a local service business, or saved aggressively over decades, I'll show you ten people who who attempted a safe boring white collar job, tried to run a local service business, or planned to save aggressively over decade, but did not achieve $1mm net worth.

> I'll show you ten people who who attempted a safe boring white collar job, tried to run a local service business, or planned to save aggressively over decade, but did not achieve $1mm net worth For the purpose of this discussion that's irrelevant. As you yourself stated > [Survivorship bias is] about falsely attributing a causal relationship between the people's actions and their success Given that within a 50km ra…

> For the purpose of this discussion that's irrelevant.

Actually, no, that's precisely the discussion we're having.

> In Australia where I'm from there are approx 234,000 high net worth individuals (HNWI) (defined as having more than US$1 million ($1.35 million) in investable assets, excluding their primary residence, collectibles and consumables).

Which is where, precisely?

> We have 8 capital cities. Using a simple naive, even, distribution...

Have you actually been to Australia? Our population distribution, let alone wealth distribution, is anything but even.

Re: Survivorship Bias

#190

Post by frgtpsswrdlame » Fri, Apr 21, 2017, 5:59 PM UTC

ctdonath wrote: post #127

frgtpsswrdlame wrote: post #114

Earlier quoted context omitted.

>He's super smart, hard working and I'm sure that accounts for the majority of his success. Why are you sure? Social mobility in america is depressingly low right now. Our meritocracy is a meritocracy no more, if it ever was one.

The mobility is there for the taking, though disincentives are at an all-time high. Welfare benefits are structured (presumably unintentionally) to discourage working: earning about $12/hr plus welfare equals about $36/hr without welfare ... but in between, welfare benefits plummet so fast that trying to work your way up from $12/hr to $36/hr amounts to a huge pay cut. As such many can't or won't make the bridging ef…

I disagree and typed out a bit of a longer refutation but I'm honestly more interested in where our disagreement stems from, I think this question might answer that for me:

I'm sure that you know people who have high incomes/lots of wealth and who are smart & hardworking. Do you know any older "poor" people (yearly income bottom quintile <$21,000, second quintile < $41,000) who are the same?