I had a month long heated debate in a eco/alternative economy political party I was a member of a few years back (I'm Danish so we're talking really liberal), about the value of education. The majority didn't value it, and as such didn't want our political program to support it. It eventually led me to leaving the party because it was just too silly for my blood.
I specifically remember when I used a good friend of mine. A dyslexic CS major, as an example of how you could still have a brilliant career through education, disability training and really hard work - and it was put off by arguments like "well if he had dropped out he might've been bill gates, instead of just running an RND department at IBM". I pointed out that the likelihood of severely dyslexic Danes with no education (his age), even having a job was very low statistically, but they would hear none of it, because "most billionaires were dropouts".
It would've been nice to have this data back then.
In countries were top education is essentially free, i really see no reason anyone should forego it, even if they don't value it as much as others. Sure, there is the off chance you might do better without that degree because you can start earlier, but statistically that chance is slim and the benefits of good education will serve you all your life.
I understand the anti movement in the US, because of their state of top education in return for lots of money which might never pay off, but this really should not inspire people in europe to drop studies.
The people who are going to say "well if he had dropped out he might've been bill gates, instead of just running an RND department at IBM" are not going to change their mind if you had shown them data.
It is important to realise that there is a big difference between the value to the individual and the value to society of a university degree. Companies use tertiary education as a proxy for IQ and conscientiousness (or willingness to tolerate bullshit to be less charitable).
Not that there is no value in university, but I think in many cases the large financial and opportunity cost does not lead to any great improvement in useful skills.
> "well if he had dropped out he might've been bill gates, instead of just running an RND department at IBM".
I'm unsure what it's called, but it is most certainly a bad argument. If they instead said: "Here is all dyslexic with an education and their economic impact, and there it is for those without - I believe we should do B because it's most beneficial", but that argument is hard to make - and we KNOW that education is good. It sounds more like they just wanted a lower tax, and education is a rather expensive thing.
The article definitely doesn't 'prove' in any way that education is worth it. You can probably find much more closely applicable data for your specific claim.
I think the idea to evaluate yourself or other people as Millionaire or Billionaire is crap.
Being middle class has value, being upper class has value, being rich has value, having a degree has value, having provided a meaningful recognisable addition to human development has value. It's so easy to have such a number drop to 50% or to zero even, without changing anything about your value, your opportunities etc. For instance if Elon Musk lost all his money tomorrow you bet he would still be able to attempt another huge project next week. But if I give you one billion dollar, you might still not be able to start a project of the same size, because you miss the skill, connections, track record etc.
The most important thing to worry about is actually doing something valuable for the people around you. The more people you can influence positively the better your life will become as well.
Example: In my country there's a start-up that tries to revolutionize the train system. All they achieved was to repair one second-hand train, rent the railway slots to drive once up south to north and once down north to south, a few days a week. Then they ran out of money.
But! It really influenced a lot of people positively, made great press, showed strong customer engagement. So even after going broke they were able to continue after a short break, because someone bought them. No money, no profit, loads of way-too-hard-work nobody else wants to do. And still they are able to get this working, because they provide something provably valuable.
This is non sense, the life for the rich is far better than for the poor. If you don't believe that is true, then you haven't been exposed to it enough. Having high status in any society can have massive advantages. More leisure time, better mates, ability to purchase expensive health care and therapy, organic food, the freedom to go anywhere in the world, the list goes on and on
Isn't "consistent billionaire" a surrogate for "way over a billion" whereas the "non-consistent billoinaire" is someone who makes about a billion? And, does any of this mean anything? who cares?
Erm. Bayes might have some trouble with this kind of analysis. There are around 2,000 billionaires in the world, and over a billion people living in Africa. Anyone moving to Africa with the hopes of becoming a billionaire is going to be disappointed.
Thanks Rosebud! This is a cool analysis, and I really appreciate you sharing the code. There are a ton of ways to pick apart the interpretations, but I feel that you were pretty up front about the difficulties of inferring much. I can empathize with the level of data cleaning fatigue you must have felt. Here's an analysis of VC backed enterprise startups that I did for a stats class: http://robterrin.com/MissingData/index#1
By the end, I was pretty much burnt out on this data set to draw many strong conclusions. Still, you busted some myths and flagged some interesting observations for further research. Thank you!
P.S. Oops, I realize the OP is not the author, but cool nonetheless.
Interesting! Would you like to offer the slides as a pdf, the html version is broken, most slides have their content cut off by a big black frame. Thanks!
I think it is. There is a persistent myth that rich people drop out of school at larger rates than average. That "fact" is often used to suggest that education might be the opportunity cost that prevents one from getting rich.
Your point is super important too, because it's extremely unlikely that level of education has anything to do with being in the top 0.01% of the income distribution.
The article's "AI data" that says a bachelor's degree is 6% important is sort of meaningless. He's measured the relative correlation of variables, among only billionaires. It's still true that only 0.01% of bachelor degree educated people get there, just like only 0.01% of dropouts get there. We can't talk about how important education is to getting there until this analysis is done on the general population.
Most of the rich became that way by engaging in unethical/immoral acts. Misrepresentation, fraud, financial elder abuse, serial bankruptcies, creating environmental disasters in third world countries without a blink of an eye. They just happen to not get caught or to not engage in activity that is outright illegal. Yes, there are innovators and inventors. They deserve our admiration. But most of the Wall Street and Real Estate billionaires are just people who are less reluctant to engage in certain behavior that is deemed by most as immoral.
You can become very rich by selling financial alchemy to old ladies with dementia. Society will deem you as "successful" and a "role model" if it's not exposed.
I am overwhelmed by all the responses. I never expected the blog post to garner this much engagement! Thank you so much for all your comments and all the reads.
> "founding_year” is intriguing. It could mean that it may be getting easier or harder to build a sustainable business.
It could mean that. It could also mean inflation. The threshold of 1B is worth less and less every year, so the number of billionaires is expected to go up every year, skewing all data toward today.
I understand the author is using hyperbole here, but it's a little ridiculous to write that no one wants to have vacillated between billionaire and near-billionaire.
I would love to see the same analysis for millionaires. A lot bigger sample size to draw conclusions on and more relevant for many people who’s goal is to become rich one day.
Since founding year seems to be of some importance, I would really like to see a plot over time of the number of founders per year and possibly extrapolate founding year + sector to predict what a good time to enter a sector would be. Could yield some interesting results.
Its a small point - but its a shame JK Rowling is used as an example of "the ghost" since the main reason she has dropped off is she is giving away her money
>. It’s not shocking that Country and Sector are important variables but “founding_year” is intriguing. It could mean that it may be getting easier or harder to build a sustainable business.
It should be pretty obvious that LUCK is a huge factor.
It's that age old saying... how does it go? "Success is when preparation meets opportunity." Bill Gates got rich because he was the right guy, at the right time, with the right (completely unfinished vaporware) product when IBM needed an OS.
Most of the new billionaires are techies. Techies that happened simply because the world became tech oriented. Surprising... nobody. There are entire billionaire families from previous "Rushes". The gold rush, oil rushes, wall street, RAIL ROAD TYCOONS, etc.
There is no scientific way to guarantee billion-dollar wealth, only correlations. And the only data I see from the article is: 1) There's more than one way to skin a cat. Some dropped out, some got Ph'ds, many stayed in the middle. That doesn't matter. Wherever you are now, you can start working. 2) Luck matters. You can be successful but the chances of you exploding is fractions of a fraction.
There's a trick to luck: find the best set of dice for you and keep rolling them. The bums are interesting, but more so the ones that end up millionaires or billionaires.
I've learned that a lot of millionaires are not very intelligent; they're just incredibly persistent. They can do the exact same thing, despite failure, for nearly a decade and end up gathering a reputation for it. Whereas most people would just give up and change careers in the middle. There's also an element of luck here - Bubba Gump comes to mind. But sometimes luck is just being in the right position at the right time, and there is a methodology to being in that position.
[+] [-] eksemplar|8 years ago|reply
I specifically remember when I used a good friend of mine. A dyslexic CS major, as an example of how you could still have a brilliant career through education, disability training and really hard work - and it was put off by arguments like "well if he had dropped out he might've been bill gates, instead of just running an RND department at IBM". I pointed out that the likelihood of severely dyslexic Danes with no education (his age), even having a job was very low statistically, but they would hear none of it, because "most billionaires were dropouts".
It would've been nice to have this data back then.
[+] [-] kayoone|8 years ago|reply
[+] [-] saiprashanth93|8 years ago|reply
[+] [-] eutectic|8 years ago|reply
Not that there is no value in university, but I think in many cases the large financial and opportunity cost does not lead to any great improvement in useful skills.
[+] [-] hvidgaard|8 years ago|reply
I'm unsure what it's called, but it is most certainly a bad argument. If they instead said: "Here is all dyslexic with an education and their economic impact, and there it is for those without - I believe we should do B because it's most beneficial", but that argument is hard to make - and we KNOW that education is good. It sounds more like they just wanted a lower tax, and education is a rather expensive thing.
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] BeetleB|8 years ago|reply
Respond with:
"And if only you were dyslexic you might be running an RND department at IBM instead of doing whatever you're doing now."
[+] [-] Tenoke|8 years ago|reply
[+] [-] erikb|8 years ago|reply
[+] [-] numismatex|8 years ago|reply
[deleted]
[+] [-] erikb|8 years ago|reply
Being middle class has value, being upper class has value, being rich has value, having a degree has value, having provided a meaningful recognisable addition to human development has value. It's so easy to have such a number drop to 50% or to zero even, without changing anything about your value, your opportunities etc. For instance if Elon Musk lost all his money tomorrow you bet he would still be able to attempt another huge project next week. But if I give you one billion dollar, you might still not be able to start a project of the same size, because you miss the skill, connections, track record etc.
The most important thing to worry about is actually doing something valuable for the people around you. The more people you can influence positively the better your life will become as well.
Example: In my country there's a start-up that tries to revolutionize the train system. All they achieved was to repair one second-hand train, rent the railway slots to drive once up south to north and once down north to south, a few days a week. Then they ran out of money.
But! It really influenced a lot of people positively, made great press, showed strong customer engagement. So even after going broke they were able to continue after a short break, because someone bought them. No money, no profit, loads of way-too-hard-work nobody else wants to do. And still they are able to get this working, because they provide something provably valuable.
[+] [-] corporateslave2|8 years ago|reply
[+] [-] paulsutter|8 years ago|reply
http://longorshortcapital.com/four-simple-steps-to-becoming-...
[+] [-] singularity2001|8 years ago|reply
) Be the 1 out of 500 million for whom it pans out. This one is key so focus on it.
[+] [-] jimmies|8 years ago|reply
[+] [-] noddy1|8 years ago|reply
[+] [-] prostoalex|8 years ago|reply
[+] [-] geocar|8 years ago|reply
[+] [-] robterrin|8 years ago|reply
By the end, I was pretty much burnt out on this data set to draw many strong conclusions. Still, you busted some myths and flagged some interesting observations for further research. Thank you!
P.S. Oops, I realize the OP is not the author, but cool nonetheless.
[+] [-] softwarelimits|8 years ago|reply
[+] [-] dayve|8 years ago|reply
[+] [-] dzhiurgis|8 years ago|reply
This looks like a regular degree distribution: https://theartandscienceofdata.files.wordpress.com/2017/06/b...
[+] [-] dahart|8 years ago|reply
It looks to me like the distribution of degrees among the billionaires skews higher than the general population, according to this: https://en.m.wikipedia.org/wiki/Educational_attainment_in_th...
Your point is super important too, because it's extremely unlikely that level of education has anything to do with being in the top 0.01% of the income distribution.
The article's "AI data" that says a bachelor's degree is 6% important is sort of meaningless. He's measured the relative correlation of variables, among only billionaires. It's still true that only 0.01% of bachelor degree educated people get there, just like only 0.01% of dropouts get there. We can't talk about how important education is to getting there until this analysis is done on the general population.
[+] [-] davidshalev|8 years ago|reply
[+] [-] tomcam|8 years ago|reply
Citation?
[+] [-] RosebudAnwuri|8 years ago|reply
Rosebud here!
I am overwhelmed by all the responses. I never expected the blog post to garner this much engagement! Thank you so much for all your comments and all the reads.
Let's keep talking.
[+] [-] dahart|8 years ago|reply
It could mean that. It could also mean inflation. The threshold of 1B is worth less and less every year, so the number of billionaires is expected to go up every year, skewing all data toward today.
[+] [-] the_watcher|8 years ago|reply
I understand the author is using hyperbole here, but it's a little ridiculous to write that no one wants to have vacillated between billionaire and near-billionaire.
[+] [-] ukulele|8 years ago|reply
[+] [-] baxtr|8 years ago|reply
[+] [-] turk184|8 years ago|reply
[deleted]
[+] [-] poorman|8 years ago|reply
[+] [-] fiftyacorn|8 years ago|reply
[+] [-] brosky117|8 years ago|reply
[+] [-] santoshalper|8 years ago|reply
[+] [-] tudorconstantin|8 years ago|reply
[+] [-] katastic|8 years ago|reply
It should be pretty obvious that LUCK is a huge factor.
It's that age old saying... how does it go? "Success is when preparation meets opportunity." Bill Gates got rich because he was the right guy, at the right time, with the right (completely unfinished vaporware) product when IBM needed an OS.
Most of the new billionaires are techies. Techies that happened simply because the world became tech oriented. Surprising... nobody. There are entire billionaire families from previous "Rushes". The gold rush, oil rushes, wall street, RAIL ROAD TYCOONS, etc.
There is no scientific way to guarantee billion-dollar wealth, only correlations. And the only data I see from the article is: 1) There's more than one way to skin a cat. Some dropped out, some got Ph'ds, many stayed in the middle. That doesn't matter. Wherever you are now, you can start working. 2) Luck matters. You can be successful but the chances of you exploding is fractions of a fraction.
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] jondubois|8 years ago|reply
I think that there is more to learn about life from a bum on the streets than from a billionaire.
[+] [-] muzani|8 years ago|reply
I've learned that a lot of millionaires are not very intelligent; they're just incredibly persistent. They can do the exact same thing, despite failure, for nearly a decade and end up gathering a reputation for it. Whereas most people would just give up and change careers in the middle. There's also an element of luck here - Bubba Gump comes to mind. But sometimes luck is just being in the right position at the right time, and there is a methodology to being in that position.
[+] [-] Jdam|8 years ago|reply