Why is it we found this Pareto distribution with some scientists say, "That's a natural order, a law of nature. We cannot do anything against it, it's just what we've found and found and found over again, this unequal income distribution." The question is where does it come from? So why scientist for hundreds of years basically saw that and said well, that's a law of nature just because we see it, just like gravity, the law of nature. So where does it come from? We're not really sure yet. There's several theories that try to explain where gravity comes from. Now, for us on this higher level of scientific abstraction on the social level, We Know grew it ourselves. So the cool thing is now we can basically open it up and look at where it comes from. So where does this unequal income distribution actually comes from? What are the parameters that lead to that? So what do you think? Well, we have several candidates, why we have that? One could be the physical landscape. So what would do now is we would play around with our physical landscape and manipulate it and see actually does it come from the physical landscape, this unequal income distribution. The other one is it might be one of the rules. We said, move to the next open spot with the most sugar and consume it. So what if he would say, "Well, they are not sugar maximizing agents, we give them different incentives." For example, be nice to your other agents. Do you think it comes from that? Do you think it comes from the rule? I don't know. What about random genetic endowments, for example the cognitive abilities that people have, the vision, the metabolism that people have or the maximum age? So is that actually something relevant? Well, that's just how we come, our agents come. So not a lot we can do then, or does it come from the initial location? We just randomly dropped our ages there. So where actually, where does it come from? What do you think? Which one of these is the culprit? Well, actually all of them. The truth is, it's a complex social system and all of them are the culprits. So it's not so easy to change it, it's more like an ecosystem. Actually, what you will see, is you try to go in your change one, and actually your entire ecosystem flips on its halves, so we have to be careful. Now the coolest thing is with this computer simulations, we can try it out without actually destroying any real ecosystem, no humans will be harmed if we tests the craziest hypothesis that we have. We can make an extremely society as we said. With shelling we had a completely racist society. We don't have to do that in reality, is enough to do that in our computer and see how things turned out. So that's the good thing about doing computer simulations, and try to piece these complex them apart, but the answer to this questions is, all of them matter. Now, let's dig in a little bit deeper and see if we can change some of them and play around with them. One theory that it tries to explain something like wealth accumulation is the neoclassical theory from economics, and that would basically take a very broad-brush now. Say well, if some people are richer and some people who are poorer, that depends on the abilities of these people. Some people are just smarter, they get richer and some people are just lazy, and if they're lazy and they don't have the motivation, they don't have these characteristics, they would just end up poorer, a very popular theory actually. Many people think like that on the political spectrum in all countries. It's very ingrained in people if you think about it. People really think poverty often comes out of people just being lazy. So we could not test the neoclassical theory which is as popular especially in Western cultures. So let's look at our agents and we can color them now by vision. So now we have different colors, the dark ones have more vision and light ones have less division, and we run it a little bit, we have our reproductive cycles, so actually our death cycles. So we have to run it a few generations. Started to 200 ticks, we found our income distribution or unequal income distribution, and let's check some out. So we go over here to somebody who's pretty far out there, we can expect this turtle. Interesting enough, they're always called turtles in it lower than has an historical reasons, and you can find somebody with a very high vision, vision of six. That's actually the good as a vision as you can get. Then we can see somebody on top of the mountain, and we expect this, and it has a vision of one. There's the lowest it gets. So we have a highly-skilled person that is actually not rich. That's not on the top of the mountain, it's actually down there, and there might be a reason to it because he's so skilled, he can just like try to be lazy. I don't know, you can have your theory about it and test that as well. Same for metabolism, we can check it out now, run it a little bit and see if metabolism, maybe it's that. It's people who are more productive, more efficient, and we can see basically the same thing. We find some people who are out there, who are actually pretty poor but highly effective, highly productive. That's why we rather hangout out there. Now, on average, you can run your correlation, your regression, you can probably see maybe there tend to be more higher-skilled, more productive people in the richer segments as compared that tend to be on average, a smaller percentage in the poorest segments, and you can do this ever. But if you look at it, really look at this diversity. It's not you can say that our unequal income distribution is a direct reflection of the skills and the productivity, the efficiency of the people, and the lazy and the dummies are the poor ones. No, we cannot absolutely not say that. That's not what we can find and the coolest thing is that the computer simulation, you can look under the hood and actually see in our case what leads to that. Even better, we can try to change it. So why Assam economist and social scientists say, "Well, there's income, inequality that's just a natural order, a law of nature because we're always find it and we always have founded in history." Well, let's see if in our theoretical model we can change. So for example, we could say that it has to do with the initial level of endowments. So let's change our level of endowment. We can do that here, and instead of having a distribution between 5 and 25, we can say everybody gets between one and two sugars at the beginning. So they're quite equal between one and two, equally poor at the beginning and we can see our model works out. We have drawn over some periods, and we can see as I said that we need to go up have a generation die and come back and we see while it's actually quite unequal. There's some fluctuations and now levels out and we pretty much get the same thing again. So if people are equally poor at the beginning, we have the same problem. Some will get rich and some stay poor, and we have a pretty high inequality in our society. What if we change it up a little bit for example, let's say we make some extremely rich? They get 200 sugars at the beginning. It's I'm extremely poor, they only get one sugar at the beginning. So we start out with some people who for example inherit a lot, and some people who are just poor. Interesting, we almost get a normal curve. That's always what it looks like. We have a big middle class. Well, so we actually started out with making some extremely rich, you might have thought that already introduces inequality at the outset but turns out we get a pretty big middle class here, interesting. What about if we make everybody equally rich? So we have still some diversity, some of our agent diversity. So for example we make the minimum 99, so at the minimum, every agents gets as initial endowment 199 sugars and there's maximum 200. So there's still some difference but between 199 and 200, pretty similar. What do you think will happen now? Do you think we'll get a more unequal or a more just society? So let's check it out. Let's run it. That looks pretty good to me. Now we get a pretty big middle class actually and you get a few richer and a few poor as actually that's what you want, and a very small inequality. The area under the Gini curve is very small, as you can see the blue line is very much at the bottom, so yes, we found a solution. The solution is just make everybody equally rich from the outset. That's a theoretical solution. It's like if you ask mathematician of how to make the fastest running cow and the mathematician answers and says, "Well, let's imagine a spherical cow." Yes, maybe the cow could be fast, it would be spherical but the spherical cow argument does not really work, and just to say, let's take all the poor in the world and give them the same salary as the richest people have in Silicon Valley. Yeah, that might be great, and these people in Silicon Valley are right now the richest people on planet earth. Good, we found a theoretical way out but practically, we have to maybe search a little bit more. But that was basically the idea to also see we can, the basic argument here and we don't have the time to go deeper but it is not a law of nature, it's not a natural order, it's not completely unavoidable that we have this extreme unequal income distribution. We can change it. We might not want to change it in some ways, we might not want to have a society, maybe give everybody riches at the outset because then maybe we have to also then model in, they might become lazy, they might become complacent, they might become entitled. So we have to see for that actually works, but what we saw here with our really very short exploration is not unavoidable. We can design societies and that's my basic point here. We can look for ways on how society to build the societies that we want to build, and if you would like to have just a more equal society, a less segregated society, for example, we can look for ways. It's not that we have to throw up our hands up in despair and say, there's a law of nature. No.
