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Comment by arnold8020

I was wondering about this in the context of the 80-20 rule, and believe I have a simple answer. Basically you need two things: 1) Some slight advantage 2) The network effect, that is, the probability of competing depends on the current winnings.

If you have these two things, you get 80-20 like distributions, you get the explanation for why winners keep winning. If you are interested, you can find my simulation and analysis at

http://www.cs.toronto.edu/~arnold/research/80-20/

Kind of shocking how well this works. The intuition is, why has coke won, well they had some initial advantage, and so they won a bit. Now that they have won a bit, they can finance themselves into more competition. For example, they can place themselves into more stores, into more restaurants etc. Now they get a chance to compete more.

parent arnold8020 8 years ago

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