The Sunday Edition

The role of luck in accumulating wealth

Rich people believe they got that way through hard work and talent. But management prof Robert Frank says the wealthy’s failure to acknowledge the role of luck in their good fortune, is eroding the society that facilitated their success in the first place.
Robert H. Frank is an economics professor at Cornell University. (Princeton University Press, Jason Koski)
Listen28:02

Jeff Bezos, the founder of online shopping behemoth Amazon, is now the richest man in the world. Bezos is worth over 130 billion dollars. It's a shocking figure, and so is the sheer number of multi-billionaires.

According to Forbes magazine's list of richest people, there are well over 500 multi-billionaires. They are mostly men, and a great number of them are American. They make obscene sums of money in tech startups and dot coms. Others strike it rich in mining, the media, retail and real estate. Some simply inherit their fortune.

Most often, the way to make a fortune and add billions on top of it, is by investing the extra cash you already have lying around in the stock market.

Amazon.com founder and CEO Jeff Bezos presents the company's first smartphone on June 18, 2014 in Seattle, Washington. ( David Ryder/Getty Images)

No two rags to riches, or riches to riches, stories are exactly alike.  But what unites many of these people is a firmly held belief that they got where they are through hard work and talent and they deserve everything that's come to them. But, is it true?

Not a chance, according to Professor Robert Frank. He says economic success has far more to do with luck. He believes the wealthy's failure to acknowledge the role luck plays in life erodes the very society that facilitates their success in the first place.

Professor Frank teaches management and economics at Cornell University. He has written many books examining the consequences of wealth inequality on society, and on the impact of rivalry and cooperation in economic and social behaviour. His most recent book is called Success and Luck: Good Fortune and the Myth of Meritocracy.  

Click 'listen' at the top of the page to hear Michael's conversation with Robert Frank.