Sunday, June 24, 2012

Lots of Luck and some Meritocracy

I often tell people please don't confuse luck with genius. I might have offended more than a few when I suggested that their success is mostly luck and not skill or talent.

I became aware of the importance of luck long ago in an autobiography of Michael Bloomberg.

Here Michael Lewis is more eloquent about the decisive role luck plays in people's success.

Weighing between luck and meritocracy, which is more decisive? At the personal level it is still luck, but by the law of large numbers, meritocracy help to make more people lucky.

Now if meritocracy leads to a new class of elites which are basically oligarchs who justify their position by their convenient read of meritocracy, that is the moment meritocracy will fail to help make more people lucky. You truck out all the statistics and any "evidence" but the people will not buy because it will not square with their experience.

A practical meritocracy must grow the economic pie so that we are not caught in a zero sum game.

Michael Lewis is right. The successful owe a debt to the unlucky to help them acquire merit so that they might succeed. Sadly today the reverse is happening. Hence the widening wealth gap.

If the successful would not help than the rest of us will eventually be forced to press for new laws to clear the deck so that we have a level playing field like when we first begun. We can't do it now as the money will flee before we can act. We have to wait for the external winds to change direction. The problem we face is global. Patience will get us what we need to survive and thrive. Meanwhile we just have to stay alive.

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