[HN Gopher] When random people give money to random other people...
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When random people give money to random other people (2017)
Author : munificent
Score : 64 points
Date : 2025-06-13 16:49 UTC (6 hours ago)
(HTM) web link (quomodocumque.wordpress.com)
(TXT) w3m dump (quomodocumque.wordpress.com)
| munificent wrote:
| There's a nice interactive simulation here:
| https://joshworth.com/jpw/does-this-simulation-explain-why-l...
|
| And a blog post here: https://www.decisionsciencenews.com/?p=6221
| gnabgib wrote:
| Discussion (555 points, 2017, 241 comments)
| https://news.ycombinator.com/item?id=14729400
| probably_wrong wrote:
| I remember that discussion because of the comment [1] pointing
| out that the rich people don't stay rich forever - the
| distribution may be skewed but that doesn't mean that the
| richer get richer.
|
| [1] https://news.ycombinator.com/item?id=14729930
| autobodie wrote:
| Nonsense. There is a big difference between the implications
| of the following claims:
|
| 1. The _specific_ people that are _currently_ rich will
| become richer.
|
| 2. The people that are rich at any given instant in the
| future will be richer than the people that are rich at the
| current instant.
|
| "The rich are getting richer" almost always means #2, but it
| depends on the context. #1 may be more interesting to
| individuals competing for wealth, or for an assessment of
| individual mobility, but #2 is much more relevant when
| describing the aggregate conditions of a society. For
| example, the Gini Coefficient depends on #2, not #1.
|
| I don't think it's a stretch to say it's dishonest to presume
| the first meaning.
| majormajor wrote:
| > Nonsense. There is a big difference between the
| implications of the following claims:
|
| > 1. The specific people that are currently rich will
| become richer.
|
| > 2. The people that are rich at any given instant in the
| future will be richer than the people that are rich at the
| current instant.
|
| > "The rich are getting richer" almost always means #2, but
| it depends on the context. #1 may be more interesting to
| individuals competing for wealth, or for an assessment of
| individual mobility, but #2 is much more relevant when
| describing the aggregate conditions of a society. For
| example, the Gini Coefficient depends on #2, not #1.
|
| > I don't think it's a stretch to say it's dishonest to
| presume the first meaning.
|
| When I see people say "the rich are getting richer" - say,
| about tax cuts for high-income earners or businesses - it's
| always been definition 1. In the case of tax cuts, the
| action is expected to make the specific current rich people
| get richer. Or, when used as a more general idiom about the
| way of the world, that _having money_ gives you a huge
| advantage in terms of making more money that means the gap
| is likely to widen over time.
|
| Some other places interpreting the idiom that way:
|
| https://www.phrases.org.uk/meanings/the-rich-get-richer-
| and-... "the inevitability of the literal truth that, the
| richer you are the more relatively rich you become and, for
| the poor, vice-versa"
|
| https://en.wikipedia.org/wiki/The_rich_get_richer_and_the_p
| o... "Shelley remarked that the promoters of utility had
| exemplified the saying, "To him that hath, more shall be
| given; and from him that hath not, the little that he hath
| shall be taken away. The rich have become richer, and the
| poor have become poorer; and the vessel of the State is
| driven between the Scylla and Charybdis of anarchy and
| despotism."[1] It describes a positive feedback loop (a
| corresponding negative feedback loop would be e.g.
| progressive tax)."
|
| So it's hardly dishonest to assume the first meaning. Where
| are examples in common discourse of it frequently meaning
| the latter?
| cantaloupe wrote:
| Only if no interest is accrued on assets. When interest is
| introduced, there is no longer shuffling.
| dgan wrote:
| okey but the burning question now is: how much more fair it
| becomes when the richer participants give specifically to poorest
| participants, instead of random one?
| munificent wrote:
| The system is fair. While the distribution is non-uniform, over
| a long enough time span, all participants will appear at every
| place in the distribution.
| msgodel wrote:
| What incentive is there to work to become rich if you have to
| give it away anyway?
| Jimpulse wrote:
| Initially, security. Then maybe a realization that you don't
| need all of your wealth to be secure.
| msgodel wrote:
| How does it provide security if you're giving it away? Why
| do you need it if not working for it means you're more
| likely to get it for free?
| parliament32 wrote:
| > maybe a realization that you don't need all of your
| wealth to be secure
|
| Then why wouldn't I just stop working? Why bother working
| at all if I'm guaranteed to be subsidized by other people?
| input_sh wrote:
| To give your life a purpose? To do something meaningful
| and fulfilling? To build something cool? To be able to
| afford additional, cooler things? To work on a common
| mission with likeminded people? To contribute something
| back to the system? To experience how things work in the
| background? To have a sense of ownership over your
| productive output?
|
| And if you wanna express yourself creatively or just do
| nothing for a while, that's fine by me too! I'm sure
| you'd get bored after a while and want to make yourself
| useful again, so I don't think you should starve in the
| meantime.
| msgodel wrote:
| Oh yeah I forgot that's why I deal with insane corporate
| administrative bullshit to write bad software that solves
| problems only generated because of the scale of the
| internal social interactions: because it gives my life
| meaning.
|
| You have hobbies and personal relationships to give your
| life meaning, you pay to be allowed to do that not the
| other way around.
| darkwater wrote:
| > You have hobbies and personal relationships to give
| your life meaning, you pay to be allowed to do that not
| the other way around.
|
| And why don't you want to turn that around?
| ncruces wrote:
| I'm sure people who, idk, have to clean up office
| toilets, do it because it's meaningful and fulfilling.
| Spivak wrote:
| A little bit of inequality is good as an incentive as you
| describe. A large amount of inequality devolves an economy
| into being pseudo-centrally-planned as nearly all the wealth
| is allocated by a small group of super wealthy individuals.
|
| You want the incentive to get rich and then have that
| incentive fall off as you acquire more wealth.
| msgodel wrote:
| We already have a pretty steeply progressive income tax.
| Part of the problem with schemes like this is that the
| wealthy have the resources to dodge them so it mostly just
| creates problems for the productive middle class.
| dfxm12 wrote:
| You can become rich enough that you can afford to give away a
| dollar to someone every second and still be rich. For some
| perspective, this full amount is about 33% of annual income
| of $100mm. The richest people make well more than this.
|
| Consider, even without such a system, more people than you
| realize have enough to live on (and pass on for generations),
| but still work. A lot of rich people also didn't work for
| their wealth. People have worked their whole lives and not
| become rich. I'm not sure there's a connection.
| Nifty3929 wrote:
| Unfortunately, money is not stuff. Taking money from rich
| people and giving it to poor people doesn't create any
| additional stuff for those poor people to consume.
| bongodongobob wrote:
| Rich people generally don't make a goddamn thing.
| scotty79 wrote:
| What incentive is there to work if you are going to die
| anyway?
|
| The incentive is that you could potentially enjoy something
| briefly and that's the best deal you can get.
| mhuffman wrote:
| >The incentive is that you could potentially enjoy
| something briefly and that's the best deal you can get.
|
| Many people might say that is a lower incentive than to
| being able to leave your family better off than they were,
| or in your more greedy interpretation, so that their
| children and their children can enjoy something less
| briefly than you were able to.
| scotty79 wrote:
| Many more people are single and don't plan on having a
| family. And for those who have .. tax is always lower
| than 100%. You won't leave your family worse off by
| earning more money, regardless of the specific level of
| the tax.
| the_cat_kittles wrote:
| what incentive is there for you to post this comment if it
| isnt going to make you rich?
| dakr wrote:
| This argument reminds me of theists asking, "without a god,
| what is there to keep you from being amoral and running
| around killing people?"
|
| Humans are capable of and do, in fact, act on more than just
| one or two simplistic external levers. We have agency,
| understanding, and drive to have empathy and to create.
| msgodel wrote:
| Right but the natural state of humanity without real social
| norms and meta norms is to just form small, violent,
| relatively unproductive tribes. Civilization doesn't scale
| without rules.
| kqr wrote:
| Of whose natural humanity? Areyou naturally violent and
| unproductive without coercion? I'm not.
| msgodel wrote:
| I build things, just not things anyone else wants. Other
| people absolutely do seem to have violent tendencies
| without coercion.
|
| People don't naturally collaborate the way you see them
| in the developed world no.
| Nifty3929 wrote:
| I think there is a bit stronger version of your argument: The
| wealth that I have is intrinsically tied to me personally:
| It's a business that I'm running, an idea I'm pursuing, etc.
| Taking it away from me destroys it.
|
| The discrepancy comes from confusing money with wealth. You
| can take my $100 and then you will have $100. But if you take
| my business away from me, you will end up with very little.
| And so will everybody else that was benefitting from the
| business that I was running.
| myflash13 wrote:
| What incentive is there to work to create wealth if an
| interest-based system is rigged towards the already-wealthy?
| dfxm12 wrote:
| Everyone starts with the same money in this thought experiment.
| How do you define richer and poorer with that in mind?
| cantaloupe wrote:
| This more detailed simulation shows the impact of UBI,
| interest, etc. Unsurprisingly it is much more balanced with UBI
| and even more extremely skewed with interest accruing.
| https://joshworth.com/jpw/does-this-simulation-explain-why-l...
| pfortuny wrote:
| Essentially similar to "after N throws of a coin, what will the
| difference be between heads and tails?". It will most likely be
| away from 0, and probably large.
| thaumasiotes wrote:
| Isn't the expectation sqrt(N)?
|
| (The expectation of |H - T|, that is; the expectation of (H -
| T) is 0.)
| pfortuny wrote:
| I think it is so (I seem to recall it and the example from
| Feller's book).
| madcaptenor wrote:
| It's definitely on the order of sqrt(N). But it's a bit
| smaller than sqrt(N) typically:
|
| (1) H is asymptotically normally distributed with mean N/2
| and variance N/4 (central limit theorem)
|
| (2) So H - T = H - (N - H) = 2H - N is ~normally
| distributed with mean 0 and variance N, or st.dev. sigma =
| sqrt(N)
|
| (3) So |H-T| is "half-normal"
| (https://en.wikipedia.org/wiki/Half-normal_distribution).
| This has mean sigma * sqrt(2/pi) or approximately 0.8
| sqrt(N).
|
| This can be checked with a quick simulation. For example in
| R I run 1000 simulations with N = 10000 with the one-liner
| mean(abs(2*rbinom(1000, 10000, 0.5)-10000))
|
| which returns 79.944.
|
| The mean square of H-T will be approximately N, though
| (basically we can ignore the absolute value when computing
| the variance).
|
| In fact, it's exactly N. H is Binomial(N, 1/2) which has
| variance N/4. H - T = 2H - N has variance N/4 * 2^2 = N,
| and mean 0, so its mean square is N.
| majormajor wrote:
| If you keep flipping a coin you get heads or tails every time.
| There's no streak-breaking limit where you stop counting
| consecutive heads after some point. But here a streak can run
| into a loss-limiting wall "for this turn, you have $0, so you
| can't give any more away." That boundary - unless you allow
| infinite negative balances - breaks the first-glance intuition.
| As people hit 0, the amount of dollars that are redistributed
| on the next turn goes down. So the richest will still be losing
| their dollar a turn, but are less likely to gain a dollar.
| Which will have the most significant effect on people nearly-
| broke, since they will still lose, but gain less frequently.
| wordglyph wrote:
| Introduce credit so the people with zero can still give. Then I
| suspect it would be more even.
| k__ wrote:
| _" inequality of wealth rapidly appears and then persists (though
| each individual person bobs up and down from rich to poor."_
|
| Does still sound fair to me.
| cantaloupe wrote:
| This is only when no other effects/processes are accounted for.
| If every participant keeps their current funds in an account
| with the same interest rate, then the distribution permanently
| skews so that there is no longer bobbing. The rich stay rich.
| See this more detailed simulation linked in another comment:
| https://joshworth.com/jpw/does-this-simulation-explain-why-l...
| munificent wrote:
| The paper this is based on [1] does a good job of spelling out:
|
| _The instantaneous distribution of money among the agents of a
| system should not be confused with the distribution of wealth.
| The latter also includes material wealth, which is not
| conserved, and thus may have a different (e.g. power-law)
| distribution._
|
| The simulation might be a good model of how _money_
| distribution works, but it doesn 't reflect how _wealth_
| distribution works. The simulation only works because money can
| neither be created nor distroyed (in the simulation, at least).
| Wealth can be so we shouldn 't expect the simulation to predict
| its behavior.
|
| [1]:
| https://physics.umd.edu/~yakovenk/papers/EPJB-17-723-2000.pd...
| thaumasiotes wrote:
| Two thoughts:
|
| - I don't see why it's important to this person that N people
| start with a total of N^2 dollars. It would seem more natural to
| have N people and M dollars.
|
| - The piece says this:
|
| > in the long run every possible state is equally likely; we are
| just as likely to see $9,901 in one person's hands and everybody
| else with $1 as we are to see exact equidistribution again.
|
| As stated, this is quite wrong. We're 100 times more likely to
| see $9,901 in one person's hands and everybody else with $1 than
| we are to see everybody with $100, because there are 100
| different people who might have $9,901 to satisfy that
| description of the state. It isn't really clear whether the
| author understands this or not.
| MichaelRo wrote:
| >> When random people give money to random other people
|
| It's called taxing the first to keep the second on welfare
| benefits.
| rexpop wrote:
| This is also an approximation of commercial exchange.
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