Going beyond the luck factor in life

Hyuncheol Bryant Kim
The author, a medical doctor, is a professor of economy and public policy at Hong Kong University of Science and Technology.

As I confessed in my recent book “The Moment When Economics is Needed,” I was barely admitted to Yonsei University College of Medicine some 30 years ago. As it turned out, I received a certificate of admission after freshman orientation was over. I was terribly lucky.

Despite tough challenges, I managed to get relatively good grades at the prestigious medical college. But after seriously wondering why poor and uneducated people are more prone to get sick than others, I decided to study economics in the year that I graduated from the medical school. After finishing my military duty as a public health doctor in a rural area, I applied for a doctoral course in economics to answer that question.

Economics doctoral programs at Columbia University, an Ivy League school in New York City, attracted excellent students from top universities around the world. My grades were certainly lower than theirs. But then, a Korean professor started to teach at Columbia and orchestrated admissions to the doctoral course that year. The professor thought of me as a top-caliber student given the high exam scores required to enter a medical school in Korea. That way, my life took another turn.

After obtaining a Ph.D. in economics from Columbia, I was hired as a professor at Cornell University, another Ivy League school in Ithaca, New York. The university selected four finalists from hundreds of applicants for a professorship and conducted very tough interviews with them for three days. Due to the uncontrollable stress and tension, I had to vomit in a hotel room.

I surely did my best at the time, but my successful recruitment as a professor at Cornell owed much to my academic adviser at Columbia, who was working as a visiting professor at Cornell during his sabbatical leave. At that time, Cornell wanted to hire my academic adviser as a professor, but he recommended me instead of himself.

I can’t ignore the luck factor in my life. Someone was in the right place at the right time. As a relatively competent economist, I made much effort to succeed as a scholar. But there are many economists as capable and hardworking as me. I can hardly explain my success solely based on my ability and endeavor.

Our society firmly believes that compensation should be made based on capability and performance. People attribute success to individuals’ efforts and their failures to their inability and lack of effort. Is it really true?

Surprisingly, most of our achievements come from what was given already, or from luck. Branko Milanovic — a Serbian-American economist from the World Bank and an expert in income distribution and inequality — showed that the country of birth determines more than a half of lifetime income. In other words, you can predict at least 50 percent of people’s adulthood earnings solely based on the average income and the Gini coefficient of their native countries. If you are born in an undeveloped country, you can hardly succeed even if you have superb ability. We are just lucky as we were born in Korea.

The next luck comes from your parents. As they are the source of two factors — genes and the environment — it is hard to distinguish between one’s share from the other’s. But economists tried to find a clue about their exact share by comparing adopted children and biological children. Bruce Sacerdote, a professor of economics at Dartmouth College, studied cases of Korean children adopted by U.S. families through Holt Children’s Services, an adoption agency in Korea. While adoptive children are only offered the environment, biological children are given both the genes and the environment. Based on the difference, the economist concluded that genes determine approximately one third of income.

No one can choose their native country or parents. If 50 percent of your success in life depends on your country of birth — and if 30 percent hinges on the genes from your parents — luck must be a predominant factor in your life. If so, does the remaining 20 percent really depend on your own effort? Not necessarily. Most of the energy to make effort is also given — and bolstered — by your parents. As seen in my career, various types of luck — and misfortune — affect achievements in life. Most of what determines our success in life are beyond our control.

In his 2017 book “Success and Luck,” Robert Frank — a professor of economics at Cornell and former New York Times columnist — pointed out that those who achieved great success tend to attribute it to their own ability. But such a mindset has serious side effects: They think their government and society did little to help them. They also blame others’ failures on a lack of effort, not on bad luck. That’s why they are reluctant to help the unfortunate. But this mindset is wrong, given the enormous power of a state over its people’s successes: We owe more than 80 percent of ourselves to our communities and other people.

Individuals face many predetermined things from birth. Likewise, a state determines much of its people’s accomplishments. For instance, if you are born in a rich country, it ensures at least a half of your achievements in life.

If our life largely depends on luck, a winner-take-all society is not healthy. It is a state that offers an environment where people who had the “wrong” parents or suffered misfortune can start all over. An important role of a state is to help the unevenly distributed luck be distributed more evenly between people.

Another reason for our society to go along with the socially weak comes from the need to discover potential innovators hidden in the lower income group and help them demonstrate their ability. In my previous column titled “The dilemma Korean students face in U.S. colleges” in the March 3 edition of the Korea JoongAng Daily, I introduced the results of a research led by Prof. Raj Chetty at Harvard University, who traced the lives of 1.2 million innovative inventors. It turned out that most of them came from families above the level of middle class. In the lower 50 percent income range, one out of 1,000 people could become an inventor.

However, in the top one percent income group, the possibility of its members becoming inventors was 10 times higher than the lower income group. Such a dramatic gap results more from environmental differences than from innate abilities. For instance, among people with similar math scores during primary school, the possibility of becoming innovators varied greatly depending on their family income.

These findings strongly point to the existence of “hidden innovators” in the lower income group. If they had been exposed to innovations early on, they could have made great discoveries. While rich families could invest in boosting their children’s potential, poor families couldn’t.

A state’s role is to find such hidden innovators and help them contribute to the development of society. Supporting the lower income group is an effective way to create a better society far beyond the realm of showing benevolence.

A final reason for our society to help the socially weak is to make our society safer. Nobel Laureate James Heckman at the University of Chicago studied what factors led to a successful life. He found that non-cognitive abilities — such as social skills, self-esteem, confidence, perseverance, sincerity, openness and emotional stability — determined income levels of both men and women as much as cognitive abilities.

In comparison, criminals generally have low non-cognitive abilities partly due to their lack of self-regard from childhood. Economics discovered that pregnancy and the birth-to-age-five early childhood is a particularly important period because a lack of interventions during that time is a short cut to poverty later.

We have a number of socially disadvantaged people around us. Just think of the people living in the blind spots, the elderly who collect waste paper, the handicapped, those who suffered disasters, North Korean defectors, and children from underdeveloped countries. They face hardships as they were born in the wrong country at the wrong time. It is not their fault. They were just unlucky.

Caring for the socially vulnerable is not about assisting them economically but about helping them contribute to making our society a better one. That’s for all of us.

Translation by the Korea JoongAng Daily staff.