The document outlines a game where players bet on coin flips, emphasizing rapid gameplay and the inevitability of skewed outcomes given equal skill levels and resources. It explores concepts like wealth distribution and the impact of initial conditions on game results. Additionally, it raises points about potential interventions to modify competitive dynamics and the broader implications for understanding inequality and competition.

1. Entrepreneurship

Game
One player in each pair bets on each
flip (up to maximum of 3 coins)

Winner of the bet takes the coins from
the loser, regardless of who flipped or
made the bet

Players must flip quickly & cannot stop
betting

Players cannot borrow coins once they
go bankrupt

If bankrupt, players are out of the
game

When time is called, stop & count your
coins

2. Guess the
Results of
Our Game?
20+
# of coins
15-19
10-14
5-9
1-4
0
Rounds

3. Why Did “X”
Do So
Well?

4. Why This
Outcome?
Given the structure of the game
and the equally high skill level,
human capital, and wealth of all
the players, a skewed distribution
was inevitable.

5. Why This
Outcome?
Given the structure of the game
and the equally high skill level,
human capital, and wealth of all
the players, a skewed distribution
was inevitable.
Winner
Take All!

6. Distribution of Firm Size (U.S.)
Number
of
F irms
(0 0 0 s)
3,000
2,500
2,000
1,500
1,000
500
0
2
7
15
60
300
Number
of
E mployees
500

7. Distribution of Corporate Assets (U.S.)
Assets (log scale)
10,000
1,000
100
10
1
0
100,000
200,000
300,000
0
Number of Firms
400,000
500,000

8. Things Would
Have Been
Different If
Players…

Started the game with different #’s of
coins


Could borrow coins


Coalitions, alliances, pooling resources,
organized crime?
Paid taxes when rich or received
subsidies when poor


Access to credit – capital markets
Could play in groups


Wealth inequality
Government intervention
Could withdraw from the game or
buffer themselves against competition

Local isolation, creation of IP or other
competitive barrier

9. Lessons

Baseline against which to judge
population level outcomes…

…In other words, don’t be too
arrogant or too judgmental!

There ARE “rules of the game”

Challenge: How to define,
manage or limit the scope of
competition?