Forgive me for the structure of this post. The truth is, I have no idea where this post will go. In this text I am going to generate a thought experiment, a thought experiment that we’ll both see the answer to in real time. The answer may be disappointing, or it may be enlightening. The only way is to experiment and find out.
I don’t particularly believe in luck. I think it’s too simple of an idea. Luck, by definition, is a series of probabilities in which are so obfuscated we don’t really know what happened. When a group of entrepreneurs IPO their billion dollar company, they are “lucky” — not that they just magically won, but that there was a series of probabilistic events — market shifts, consumer changes, VC decisions — that went in their favor.
Of course, if you accept this definition, you quickly see that there are ways to “game” luck. The way to game luck is this: 1) reveal the probability events, and 2) load the probability events in your favor. You can’t do this with everything — for example, if you hacked the slot machines at Caesar’s Palace, you’d be arrested and permanently banned from the city of Las Vegas. But most problems in life aren’t that simple. Going back to our entrepreneur problem, how can we “game” our example events?
Well, we can find market shifts and use that to create a company that would work. We can market to consumers and convince them that they want our product. We can influence VCs into believing that they want to fund our company. These examples are not luck — they are skill. Heavy skill, but skill nonetheless.
Alright, let’s get to our experiment. Perhaps no part of luck traumatizes us more than luck’s relationship with success. We are set to believe that, without luck, there is no success. That every successful event requires at least a tad bit of luck. Of course, as luck skeptics, our hypothesis is that there exists a success event which does not involve luck. The corresponding null hypothesis is that all events in the set of success events require luck.
We define a “success event” by achievement of a life-term goal. To keep our example easy we will use one, which is “owning a house”. Skill is defined by observable knowledge, luck is defined by unobservable knowledge. Actors can use skill to “observe” previously unobserved knowledge, i.e. reducing luck.
The first luck event, of course, is The Great Lottery — where you are born, and in what condition. I concede to this event, though I also will argue that it does not necessarily count — this event happens pre-actor, and thus cannot be observed. We need luck and skill to be on equal ground before we can start our experiment.
Let’s say our actor starts off not great — they are born in a poorer region in the Great Unknown. There are a wide amount of factors this Lottery entitles to us: our gender, our skin color, our ability, our family. Since we are unlucky, these will all be against our favor: we are in a discriminated gender and skin color, with poor ability and a not-so-wonderful family life.
We begin by observing our traits, and observing their status — i.e. of “poor ability”, we know our ability and we also know it is poor. Family life is the weakest link — we can escape this hurdle. We cannot escape physical traits (gender, skin) nor ability. The question then becomes: can we work these off?
Now things get tricky. We are barred from education, and most employers will not accept us. We can educate ourselves and work on our own, but it will be much harder and we will fall behind compared to others. Fortunately our success event does not require comparatives (we only need one success to reject the null!). Let’s say that educating ourselves improves our ability (in many states of being it does) and let’s use that “most” to our advantage and say we do get a job. Here, we’re unlucky again — our rate of learning is very slow, and our work pays diminutive wages.
Before we continue in solving this next problem, I want to make a small digression. I am going to make another concession, and this time my concession will be much more powerful than that of The Great Lottery. I am going to say that having the motivation, or mindset, to improve is lucky. In fact, I would say this single assumption is the corkscrew that throws the whole thing off-kilter. If we have no motivation to improve, then it’s all luck to us — we can’t do anything, and we can only accept life. The unfortunate truth is that this is what happens to most people. If we all had the “improvement” mindset, then all of us would reach our success events. But we don’t. And I don’t believe there is a way to get people to see this mindset other than a probabilistic event. You just get it, or you don’t. You don’t learn to get it, because you don’t learn in the first place. It’s the fundamental block.
Once again, I will argue that this concession doesn’t automatically end our experiment. Mindset is an odd case, since it is outside what we traditionally deem as “luck”. People think you become lucky to make a million dollars, or found a successful company, or become a published author. These events I don’t think are lucky. Yet you don’t see anyone (besides me) saying, “oh, he’s lucky because his brain found out how to improve”. And since this is primarily a colloquial argument, I’ll say that fact allows us to keep going.
Alright, so we’re improving, but it’s very slow. Fortunately for us, the returns of education compound exponentially. This is because education benefits from network effects — scopes of learning are “networked”, meaning that learning one subject connects to various others. This is the fundamental idea behind mental models, among other things.
We also know that education correlates positively with work, and work correlates positively with money. There’s two ways that better education can mean better work: the most common is that being better educated leads to quicker promotions, increasing returns from work linearly. The second method (and more likely in our case, since we assumed a barrier to promotion) is that being better educated leads to entrepreneurial activity, increasing returns from work exponentially. This leads us to our last obstacle: can we build a business without luck?
To start off, zero-to-ones are out of the picture. The amount of background knowledge and probability estimates required to successfully pull off a billion dollar company is just too much. It isn’t luck, per say, but it might as well be. Good for us then that we choose our success event to be owning a house, which only requires a few hundred thousand.
In this case, an income generator will suffice. It won’t break any barriers, but you don’t need to — you just need something people will buy. With enough education, we can assume that an idea will come. When it comes to convincing people to buy things — this requires sales and marketing learning, which doesn’t require any luck to gain. We won’t use funding, since we probably wouldn’t have access to it anyway — because of this the path will take quite some time, but it’s nothing but time that we have. Eventually using this method we can build up enough cash to buy our house and achieve our success event, no strings attached.
Obviously this is one example for one event. It’s not a particularly practical example, either — but the idea is that with this base case we can extrapolate to whatever specific details we want and find that, yes, there are success events which do not require luck. You can be successful and not lucky.
I also want to connect this with a simpler idea, one that probably could have made this post a lot shorter. Instead of going through all the hoops of describing the unlucky life, I could have just chosen a different success event. What about being happy? Well, that doesn’t require luck. Perhaps it still requires the concession of the Mindset Problem, but if you have the mindset to learn then the problem is finished. Find happiness — you don’t need any external force to figure that out. I’m not saying it’s an easy problem, I’m just saying that even the unluckiest man alive could do it.