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Chef Nobody @i_amm_nobody
, 15 tweets, 3 min read Read on Twitter
1/ A few months ago I tweeted a quote from Jordan Peterson that I felt summed up the politcal-economic tradeoff quite nicely: "Innovation is paid for with inequality."
2/ Now, I have come to believe that this tradeoff is mistaken. The mistake's origin, I believe, lies in conflating economic equality and economic mobility, or at least in thinking that these are positively correlated, when in fact the opposite holds more truth.
3/ These two passages from @nntaleb, the first from Skin in the Game and the second from The Black Swan turned my worldview on this topic upside down.
4/ We make the mistake of thinking the economy is one big monopoly game, whoever is lucky enough to hit the right spots at the beginning of the game reaps infinite rewards going forward.
5/ In reality, the economy is much more dynamic than this, the game is constantly evolving. To think that the economy rewards those who master the rules of the current game is a tremendously short-sighted.
6/ The real rewards lie in CREATING new rules altogether that benefit all of the players i.e. innovation. Upgrading from Monopoly to Catan is non-zero-sum although the current winner of the indefinite Monopoly game is no doubt hurt by this.
7/ This act of creating new rules, [Taleb argues] just as lucky and unfair of a process as winning the initial one, so why is it better? In fact, it has benefits outside of the clear non-zero-sum increase it provides.
8/ It creates the reality a reality of iterated games rather than just one game. Given a strong element of randomness, a series of iterated games will generate equality in the long run.
9/ A static economy is one in which a dice is rolled once and the people who chose 6 are considered brilliant and given all the rewards. How much of Job's brilliance is an illusory narrative created in a world with too few innovation games?
10/ The law of large numbers dictates that the frequency should converge on the actual probability as the number of trials increases. Given complete randomness, each number would share an equal 16.67% of the wealth.
11/ No doubt, innovation is not purely chance. Job's is a genius, but luck plays a far higher role than our narrative-creating minds want to admit.
12/ The point is that the real way to create a more equal society is to increase the pace of iteration between games- INNOVATION. Peterson's statement was backward.
13/ If innovation is mostly luck, or "positive accidents" as Taleb puts it, we don't create them in the same way we don't create luck. We instead, position ourselves in a such a way as to be luck's beneficiary.
14/ In other words, we increase the scalability of positive accidents- of random but marginal improvements, and suddenly, you have the law of large numbers on economic equality's side.
15/ Lucky for us, nothing scales to the extent that information does, and currently, the IT sector is on track to consume the entire economy. An Information Economy, given that it's decentralized, is one of extremely scalable positive accidents.
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