A couple of days ago, I stumbled upon an exchange between two people who were complaining about not getting the recognition they thought they deserved based on the amount of time and effort they put into the chain. So I want to address why this is the case with many things in life how hard work or doing more doesn't change the plight of such people and lastly, how anyone can come out of such a situation.
For the purpose of this post, I will give two instances to explain a phenomenon called the Pareto effect. This principle explains the unequal effect of input and output. It goes further to explain that, most times, the outcome of any activity is due to 20% of the effort put into it. This also ties closely to the concept of diminishing marginal return.
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To put things into context, nonsowrites make a post and earns $5. He goes on to make 4 posts and earns $20 and nonsowrites is happy. So he decided to put in more effort and make 20 posts, unfortunately, which yields only $50, and nonsowrites is confused. His post quality and effort remain constant but his earnings has not increased and in some cases decreased.
In the aforementioned scenario, nonsowrites has reached the maximum earning limit, and putting in more time and effort will yield little to no result. Now, no one is going to tell nonsowrites that there is a ceiling as to how much you can earn based on several factors, most of which are fixed. This is because this knowledge hurts the bottom line of those who benefit from the excessive work you do. These are the people who benefit from the Pareto effect. They put in their 20% (usually their capital) and make 80% more.
Now that you understand the Pareto effect, does this mean you should do less? No. This is about maximizing your time, effort, and resources. In other words, knowing what your limit or ceiling is and allocating that extra time and effort towards other ventures. So rather than putting 100% in just one thing that doesn't have the chance to scale 10x-100x, you can invest your 20% in 5 different ventures and maximize your output.
Now, there are some drawbacks to spreading yourself thin. There is the likelihood you take in more than you can handle which often leads to burnout and poor turnout in the long or short run. To counter this you need to delegate or automate activities. This allows you to focus while also maximizing other opportunities.
The other drawback to venturing into several things is that you do not have the skill set to do so. Remember, the whole point of trying out different things is to maximize output and input. You cannot achieve this if you are not competent. There is the case of delegating tasks but it requires more resources which you might not have at your disposal at the time of reading this post.
So I hope this helps those who have issues reconciling their effort to reward, and why it seems like those who are putting in less effort tend to make more. It's the Pareto effect. It is the reason why the poor will keep getting poorer and the rich get richer. Crypto was designed to curb this in some way but that has failed. The culprit as always remains human nature.
creator: ahmadmangaPosted Using InLeo Alpha
