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The Zero-Sum Bias: When people think that everything is a competition

effectiviology.com

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Re: The Zero-Sum Bias: When people think that everything is a competition

#91

Post by gruez »

umvi wrote: post #66
tasty_freeze wrote: post #45

Earlier quoted context omitted.

Your claim is the flip side to the joke that goes something like, "The law is blind to class: it is equally illegal for a rich man to sleep under a bridge as it is for the poor man." The point being: a large fraction of the population in the US is living paycheck to paycheck and has no money to spare for investing in an index fund.

And yet many blow at least $3000+ per year on worthless consumables like cigarettes and lotto (at least my pack-a-day neighbors do). $3k per year in an index fund is certainly not insignificant.

>And yet many blow at least $3000+ per year on worthless consumables like cigarettes and lotto

being poor impairs your cognition[1], so it's not surprising that they are wasting money on stuff like that.

[1] random google result: https://www.scientificamerican.com/article/how-poverty-affec...

Re: The Zero-Sum Bias: When people think that everything is a competition

#92

Post by biql »

TTPrograms wrote: post #75
petra wrote: post #21

Modern Life is so complex. And in many situations , telling whether they're zero sum, is uncertain, and hard. Look at the debates here for example. So people default to what they already generally know. They know that society is very competitive. The job market is very competitive. The mating market is very competitive. Zero sum games are everywhere. So it's no wonder they have this cognitive bias.

None of those markets are really zero-sum. People value different things in all of those markets (jobs etc). Zero-sum is an edge case.

In dating market, attractive people get most of the attention [1], thus it would be safe to assume that attractiveness is highly valued by the majority and they compete with each other, knowingly or not.

[1] https://web.archive.org/web/20170127222943/https://blog.okcu...

Re: The Zero-Sum Bias: When people think that everything is a competition

#93

Post by closeparen »

petra wrote: post #79
TTPrograms wrote: post #75

Earlier quoted context omitted.

None of those markets are really zero-sum. People value different things in all of those markets (jobs etc). Zero-sum is an edge case.

Interesting answer. The people aiming for a certain position or role mostly care about similar things though. So don't they play a zero sum game ?

The most effective person gets hired into a role. The firm performs well, moves more product, lowers prices for customers, sends larger orders to its suppliers, invests some surplus in R&D, grows its payroll, generates return for shareholders who then invest their gains in other enterprises, etc. Or an ineffective person is hired and the opposite happens.

https://en.m.wikipedia.org/wiki/Lump_of_labour_fallacy

Re: The Zero-Sum Bias: When people think that everything is a competition

#94

Post by ska »

temp-dude-87844 wrote: post #69
ska wrote: post #29

Earlier quoted context omitted.

I don't think that is quite right. Consider the difference between a society with extremely uneven wealth distribution, such that only a tiny percentage felt safe an comfortable. It's easy to imagine a more even wealth distribution changing that for a large percentage of people. There is a tautological zero-sum ordering in relative wealth, but it's not clear that correlates to anything meaningful to vast majority of…

A higher level of relative wealth unlocks an advantage in the allocation of scarce resources like land and housing within a particular locale, which is meaningful to lots of people.

The point is it doesn’t for many people at all if the distribution is uneven enough, I.e. distribution matters.

I’m not saying it’s not important, I’m saying it’s not obviously zero sum. If it was, any marginal change for one person would have impact for another. With an uneven enough distribution I could lose relative in an amount that actually has no impact for me, but could have utility going to you, say. Bear in mind the criteria was “safe and comfortable”, not “able to outbid you on a property”

Re: The Zero-Sum Bias: When people think that everything is a competition

#95

Post by perfmode »

0815test wrote: post #53
wayoutthere wrote: post #3

Earlier quoted context omitted.

I suspect it is because many humans derive self-worth from seeing other people who are worse off than they are. If you have that mindset, personal comfort really can be a zero-sum game, sadly...

Protip: please don't say "humans" when you can just say 'people', or even 'folks'! It makes you sound a lot more, well, human , and less like a poorly-programmed, clunky robot. Related: https://slatestarcodex.com/2019/07/04/style-guide-not-soundi...

this feels like a superfluous nit

Re: The Zero-Sum Bias: When people think that everything is a competition

#96

Post by mixmastamyk »

pessimizer wrote: post #64

I see this most clearly in people who will not trade in a board game like Monopoly unless the deal is extremely slanted in their favor. They simply can't understand that people who trade will always beat people who don't, and the easiest way to trade is to trade fairly. If four people are playing a game of Monopoly, and two trade with each other but the other two refuse, now two people are playing Monopoly and the ot…

There's such an advantage to having a full color set, it's hard to imagine folks that don't want to trade to get one.

Re: The Zero-Sum Bias: When people think that everything is a competition

#97

Post by logicprog »

gruez wrote: post #91
umvi wrote: post #66

Earlier quoted context omitted.

And yet many blow at least $3000+ per year on worthless consumables like cigarettes and lotto (at least my pack-a-day neighbors do). $3k per year in an index fund is certainly not insignificant.

>And yet many blow at least $3000+ per year on worthless consumables like cigarettes and lotto being poor impairs your cognition[1], so it's not surprising that they are wasting money on stuff like that. [1] random google result: https://www.scientificamerican.com/article/how-poverty-affec...

I'd imagine that the people they studied in Bangladesh in that article are a lot more poor than basically anyone in the US, especially people with $3k to spare on anything.

And if you were to find evidence of poorer people having impaired decision-making skills in the US (and there might be evidence of that), the question becomes, are they as poor as they are because of that poor decision making?

Re: The Zero-Sum Bias: When people think that everything is a competition

#98

Post by logicprog »

mikeash wrote: post #18
umvi wrote: post #6

This will be controversial, but this is true everytime there is a pitchfork-inducing "the rich got richer in 20XX" thread. But it's not that the rich stole from the poor in order to become richer (though undoubtedly people will argue this). If I stick a million dollars in an index fund and passively get richer, am I stealing from the poor? Wealth is not zero sum, yet we seem to treat it like it is (in order for poor…

It’s a common fallacy to believe that wealth is zero sum. It’s also a common fallacy to believe that, since it’s not zero sum, gains by one group are uncorrelated to losses by another. If the rich got richer, does that mean they took from the poor? No. But it also doesn’t mean they didn’t . As usual, you have to look at the specifics. The world does have limited resources and capacity for economic growth. In your ind…

I mean, it's hard to say for sure that on the large scale allocating extra money to poor people would be any more efficient in the long run. Rich people buy things, paying a lot of paychecks. They are also funding a lot of innovations and putting in investments. Things that improve more lives over time than just giving random people lump-sums. Furthermore the question is also: who gets to decide where that money goes? A sibling comment mentions money allocation. Allocation via distributed emergent system is what we have now. To try to allocate more "efficiently" you need someone to manage it. Who should do that job? Sounds like a great/horrible one.

Re: The Zero-Sum Bias: When people think that everything is a competition

#99

Post by AznHisoka »

11thEarlOfMar wrote: post #67
pessimizer wrote: post #64

I see this most clearly in people who will not trade in a board game like Monopoly unless the deal is extremely slanted in their favor. They simply can't understand that people who trade will always beat people who don't, and the easiest way to trade is to trade fairly. If four people are playing a game of Monopoly, and two trade with each other but the other two refuse, now two people are playing Monopoly and the ot…

It's one of my all-time favorites. My favorite 'house rule' was invented by my nephew: He negotiated a % of rent I collected utilizing properties he traded to me.

"I'll trade you this missing piece, but get 10% of all the rent you collect when someone lands on them AND I don't need to pay you rent if I land in them... AND if you land on free parking the next 2 times, that cash goes to me"

Re: The Zero-Sum Bias: When people think that everything is a competition

#100

Post by barberousse »

wpietri wrote: post #61
wayoutthere wrote: post #12

Earlier quoted context omitted.

I actually believe this effect is responsible for most of the racism we have in the US. Black people are an easily identifiable “lower class” who aren’t supposed to have power over white people or have higher social standing. A lot of Americans were irrationally angry at Barack Obama as a result.

And that's no accident. I'm currently reading Kendi's excellent "Stamped from the Beginning". He goes into a fair bit of detail how early in the US's history poor whites allied with poor blacks in pursuit of better economic equality. The white elites quickly recognized this as a problem and worked to turn poor white people against the black population. We're still paying the price today.

W.E.B. DuBois wrote about this same exact scenario a hundred years ago as well, though writing about the reconstruction period in the South after the war
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