Tilted Forum Project Discussion Community - View Single Post - Wealth Redistribution and a Moral Imperative

Yakk · 11-01-2008, 02:55 PM

Sun Tzu, it is true that 'self made people' tend to overestimate their own ability to control their own destiny.

Interestingly, they still fail at the statistically expected rate[1]. However, those that do not have that self-overestimation of their own competence don't gamble as often based on their own competence.

[1] Ie, if you take small business owners, and ask them what percentage of small businesses will fail in the next year, they tend to be about right. If you ask them what is the chance their business will fail, the average over the small businesses ... is far lower than the actual rate.

Now, this isn't evil or wrong or anything like that. But anyone who actually thinks that their own competence means that they won't fail - that luck or other factors beyond their control don't have a huge impact - is deluding themselves. This delusion might result in them doing things that are actually a good idea, but the delusion exists.

And if you base your decisions, on a wide scale, on that delusion, you get crappy results. If you base your decisions, on your personal scale, on your own over confidence, then are you are more likely to end up stinking rich. At the same time, if you don't buy a lottery ticket, you are less likely to end up winning the lottary -- but that doesn't mean buying the lottery ticket was a good idea for everyone who bought one. :-)

11-01-2008, 02:55 PM	#155 (permalink)
Yakk Wehret Den Anfängen! Location: Ontario, Canada	Sun Tzu, it is true that 'self made people' tend to overestimate their own ability to control their own destiny. Interestingly, they still fail at the statistically expected rate[1]. However, those that do not have that self-overestimation of their own competence don't gamble as often based on their own competence. [1] Ie, if you take small business owners, and ask them what percentage of small businesses will fail in the next year, they tend to be about right. If you ask them what is the chance their business will fail, the average over the small businesses ... is far lower than the actual rate. Now, this isn't evil or wrong or anything like that. But anyone who actually thinks that their own competence means that they won't fail - that luck or other factors beyond their control don't have a huge impact - is deluding themselves. This delusion might result in them doing things that are actually a good idea, but the delusion exists. And if you base your decisions, on a wide scale, on that delusion, you get crappy results. If you base your decisions, on your personal scale, on your own over confidence, then are you are more likely to end up stinking rich. At the same time, if you don't buy a lottery ticket, you are less likely to end up winning the lottary -- but that doesn't mean buying the lottery ticket was a good idea for everyone who bought one. :-) __________________ Last edited by JHVH : 10-29-4004 BC at 09:00 PM. Reason: Time for a rest.