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The difference betwen skill and luck.

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Re: The difference betwen skill and luck.

#31

Post by jonpaul »

jacques_chester wrote: post #29
rick888 wrote: post #27

Earlier quoted context omitted.

"Zuckerberg is not particularly unique in terms of his intelligence, ambition or connections. Men and women like Zuckerberg have come into and passed out (or dropped out) of the USA's elite universities for centuries. Yes. Luck played a big role." The reason I say luck didn't play a big role, is because not anyone could do what he did. Can anybody from a 5 year old to a grandmother build Facebook? If not, there must…

I am reminded of an anecdote of a famous physicist talking to Army personnel during WW2. Unfortunately I cannot find a reference with various keywords on Google, so take it as you will. Somehow conversation turns to the great generals -- the 4 and 5 star generals. "How many great generals are there?" asks the physicist. "No more than about 1 in 20 is a truly great general", they answer. "How do you decide who is a 4-…

That makes about as much sense as saying: pick two sports teams to play each other, the odds of one of the team winning is 50%. The point is, that probability doesn't hold, and thus nullifies the anecdote.

Re: The difference betwen skill and luck.

#32

Post by jacques_chester »

jonpaul wrote: post #31
jacques_chester wrote: post #29

Earlier quoted context omitted.

I am reminded of an anecdote of a famous physicist talking to Army personnel during WW2. Unfortunately I cannot find a reference with various keywords on Google, so take it as you will. Somehow conversation turns to the great generals -- the 4 and 5 star generals. "How many great generals are there?" asks the physicist. "No more than about 1 in 20 is a truly great general", they answer. "How do you decide who is a 4-…

That makes about as much sense as saying: pick two sports teams to play each other, the odds of one of the team winning is 50%. The point is, that probability doesn't hold, and thus nullifies the anecdote.

I didn't explain it very well.

The point of the anecdote is that the null hypothesis -- that 5-star generals are there basically because somebody "wins" each battle and that a fixed percentage of these will win 5 in a row -- is difficult to distinguish from genuine tactical skill.

That's the point of the article too. We too often attribute to skill what can just as reasonably be luck. Partly because of survivor bias: Zuckerberg et al are the one group out of the hundreds of contenders who succeeded in getting runaway network effects. But if contenders had non-zero chances of success, somebody was bound to succeed. The null hypothesis is that Zuckerberg was just lucky and it is basically not easy to disprove, given that as I said above there's nothing particularly unusual about him or Facebook going into the fight.

Re: The difference betwen skill and luck.

#33

Post by ssebro »

beder wrote: post #15
StavrosK wrote: post #14

> Reversion to the mean. Any system that combines skill and luck will revert to the mean over time. This means that an extreme outcome, good or bad, will be followed by an outcome that has an expected value closer to the mean. So if I toss a coin 10 times and it comes up heads, the next toss is more likely to come up tails? I smell a rat.

No, it means that in the next 10 tosses, you still expect to get a 5/5 split, so over these 20 tosses, you'll probably have 15 heads, which is closer to the mean. I've seen this analysis in sports. In baseball, for example, you generally expect teams to win one-run games as often as they win games in general (that is, there's no "great closer" effect). So if you see a team winning 80% of their one-run games in the fi…

This is still wrong, since coin flips are independent events, and events that are totally independent can't affect each other's probability. I understand your reasoning, but it is flawed.

Re: The difference betwen skill and luck.

#34

Post by ssebro »

StavrosK wrote: post #20
beder wrote: post #15

Earlier quoted context omitted.

No, it means that in the next 10 tosses, you still expect to get a 5/5 split, so over these 20 tosses, you'll probably have 15 heads, which is closer to the mean. I've seen this analysis in sports. In baseball, for example, you generally expect teams to win one-run games as often as they win games in general (that is, there's no "great closer" effect). So if you see a team winning 80% of their one-run games in the fi…

Ah, I see, thanks.

No dude- you were right and he was wrong.

Re: The difference betwen skill and luck.

#35

Post by ssebro »

jonpaul wrote: post #11

The best single comment I've read about luck was written right here on HN. I've detailed it here: http://techneur.com/post/1321568428/luck-ii In summary, I made a comment about Zuckerberg and the value of Facebook. Someone responded that he was lucky. To which someone else responded with this: (Can't find original HN comment) "This attitude bugs me a lot. There is probably a path for every single person in this count…

I don't want to be a dick, but you do have some amount of control over the probability of you winning the lottery. If you don't play, it becomes significantly more difficult to win.

Re: The difference betwen skill and luck.

#37

Post by StavrosK »

ssebro wrote: post #34
StavrosK wrote: post #20

Earlier quoted context omitted.

Ah, I see, thanks.

No dude- you were right and he was wrong.

No, he's saying that if you have a few outliers to begin with you expect to get more normal-looking data later on, drowning your outliers in them. If you get 5 heads initially and then another 5 heads and 5 tails, it's still closer to the mean than when you began.

Re: The difference betwen skill and luck.

#38

Post by ngsayjoe »

_b8r0 wrote: post #2

This reminds me of a discussion on a mailing list where someone pointed out the most amazing scam. You find 256 people and email them the details of a 50/50 prediction. 128 people should get the right prediction. You then email them another 50/50 prediction. Of course, 64 of them receive the right prediction twice in a row. You then make a third 50/50 prediction to the 64, another to the 32 positive responses and so…

Warren buffet says what if all that predict successfully come from the same village, wouldnt that tells you something?

Re: The difference betwen skill and luck.

#39

Post by khafra »

ngsayjoe wrote: post #38
_b8r0 wrote: post #2

This reminds me of a discussion on a mailing list where someone pointed out the most amazing scam. You find 256 people and email them the details of a 50/50 prediction. 128 people should get the right prediction. You then email them another 50/50 prediction. Of course, 64 of them receive the right prediction twice in a row. You then make a third 50/50 prediction to the 64, another to the 32 positive responses and so…

Warren buffet says what if all that predict successfully come from the same village, wouldnt that tells you something?

The same rules of probability apply, so it depends on the number of villages making predictions divided by the improbability of successfully matching that village's predictions. If there were only 10 or 20 people buying lottery tickets, and one of them actually won, I'd pay very close attention to that one person's methods.

Re: The difference betwen skill and luck.

#40

Post by cema »

sobbybutter wrote: post #3

"In the mid-1970s, a man sought a ticket that ended in 48. He found a ticket, bought it, and won the lottery. When asked why he was so intent on finding that number, he replied, 'I dreamed of the number seven for seven nights. And seven times seven is 48.'" Something tells me this guy did well by not taking math in grade school too seriously.

Well, he was close enough.
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