Why Some Gamers Deserve More Money Than Doctors

It’s a controversial subject, but after you read this, I hope you’ll understand why it’s logical that some gamers deserve to be paid more than doctors.

I know some of you are rolling your eyes at the idea of an entertainer earning more than a brain surgeon, but give me five minutes and I promise it’ll make sense.

Why gamers? In case you missed it: Twitch.tv was hacked last week and someone uploaded all their data to the net. This included payout information which many streamers confirmed was accurate. Some people were blown away that teenagers could earn millions of dollars just by having people watch them play video games.

This article talks about video game streamers, but you can substitute “entertainer” for professional athlete, YouTuber, artist, romance novelist, or any other career (that’s easy to learn but hard to master) you feel is undeserving of a high salary relative to someone who spent 15 years in school and could save your life by removing a tumor from your brain.

Are we riled up yet?

Okay great.

First, to understand why some gamers out earning doctors makes sense, we need to talk about utility. I believe this to be the most important economic concept anyone can ever learn. Utility is how economists measure the usefulness, or the happiness generated by people, places, goods, and services. Everything in existence has a utility value. This value can be similar for most people, or different for everybody. The amount of “utils” that something generates is constantly changing.

Let’s say you’re starving. Someone offers you a slice of pizza. You eat it and it’s delicious. When asked to assign a utility value to that slice of pizza, you say, “That was worth 100 utils.”

After 15 minutes you’re offered a second slice of pizza. You’re still hungry but not quite as starving as before. When prompted to assign a util value, you respond with, “80 utils.”

See where this is going? Every slice of pizza offered to you is worth less utility because you’re getting less hungry. This is called the Law of Diminishing Marginal Utility.

If you kept eating pizza, eventually the utils generated would dip into the negative. Eating more pizza would cause physical pain. The pizza would taste disgusting. You’d gag at the smell of it.

It’s not just food that has utility, it’s everything. When we’re young we’re taught to believe that the harder a job is, the more you get paid. People who work at McDonald’s (zero education) get minimum wage, whereas lawyers (seven years of university) get $120,000+.

The idea that people with less education deserve less money is constantly referenced during arguments about the minimum wage. This idea is wrong.

The idea that should be taught is: People that create more utility will earn more money. Because that’s how the world actually works.

Picture this: Someone sits at home in their bathroom doing nothing. How much per hour is this person worth? Well, unless you live in a country with universal basic income, probably zero.

At the other end of the spectrum is Superman. He’s constantly saving people, pets, Earth, and even sometimes the universe. Superman creates a lot of utility. If he were paid by the hour, his quote would be off the charts.

Clark Kent (Superman) has a degree in journalism from Kansas University. But, if he were to be properly compensated for his services, his hourly rate would be a lot higher than a $22/hour.

Yes, Superman is a fictional character, but the point I’m trying to make is: It’s not your level of education that determines your pay, it’s the amount of utility you create.

Doctors go to school for decades, but most of them earn less than top-paid video game streamers. If this seems unfair, it’s not. It’s exactly the way it should be because most doctors create less utility than the most-popular Twitch streamers.

Remember, everything we do creates utility. Entertainment is valuable. Humans get bored a lot. Like all the time. If you want to test this, sit in a blank room with no windows. See how long you can last doing nothing. No meditation. No sleeping. No listening to music in your head.

Unless you’re in a coma, this won’t last long.

Entertainers create utility, they just do it in a different way than doctors. A doctor serves one customer at a time, whereas entertainers serve thousands.

Imagine a doctor in small village in Uganda. We’ll call her Masiko. Masiko sees 50 patients a day. Without this doctor, the local area would be in deep trouble. For this village and the surrounding area, Masiko creates a ton of utility and is extremely important. She diagnoses conditions before they worsen. Helps with mental health. Enrolls patients with rare diseases in new drug trials. Masiko is literally, a lifesaver.

But not to you. To you, Masiko is worthless. You will never meet Masiko. She will never treat you. She will never prescribe you medication or tell you to get that mole examined because it might be cancer. Masiko doesn’t create utility for people outside her tiny village and that’s why she gets paid less than video game streamers like Ninja or Kripparrian.

Humans aren’t compensated based on their level of education. Humans are compensated based on the amount of utility they create. If you run a business, this is why it’s important to keep giving raises to your top performers. When people feel their compensation is drastically lower than the utility they’re creating, they might quit and find somewhere else to work.

Masiko creates a ton of utility for her small village in Uganda. If a slice of pizza is worth 100 utils, then Masiko prescribing antibiotics might be worth 50,000 utils. But only to that specific patient.

Entertainers work differently. They don’t create a lot of utility for each individual person.

Let’s imagine a professional hockey player named Dave.

Dave has zero post-secondary education.  He joined the NHL straight out of high school. He only plays 82 regular season games a year. Each game is only 60 minutes long, and Dave is only on the ice for 19 minutes on average. Dave has been playing in the NHL for 10 years.

Dave, an uneducated entertainer who only works for 26 hours a year has a salary of $6 million/year.

Masiko, who went to school for 10 years and works 10 hours a day, has a salary of $1,700/month.

Of course, the cost of living is much cheaper in Uganda, but when you look at it like this way, it makes it seems like Dave is grossly overpaid. (He’s not.)

If a slice of pizza is worth 100 utils, then how much is watching a hockey game at home on the TV worth? 400 utils? 300? 700? It depends how much you like hockey.

Let’s say watching a hockey game is worth 500 utils to you. Dave isn’t creating that 500 all by himself. There are two teams, coaches, support staff, referees, etc. If you break it down, Dave himself might not even be creating 10 points of utility for you. If Dave is injured, the game would still go on.  Dave is a tiny cog in a giant entertainment factory. But that factory gets a lot of eyeballs.

Dave doesn’t create a lot of utility per person, but if Dave were a Doctor of Boredom, he’d be seeing a lot of patients. NHL games have more than 300,000 TV viewers. Dave helps sell merchandise. Tickets. Food at the concession stands.

Entertainers create less utility per person than doctors, but the best ones create more utility in total therefore they earn more money.

Yes, it’s possible that people can be paid more than they’re worth. Sometimes a first-round draft pick turns out to be a flop. But the universe eventually corrects these mistakes. If a CEO is drastically overpaid relative to sales, the company will go bankrupt, it’ll get bought out, or the board of directors will replace them. Either way an overpaid CEO is on borrowed time.

In the long run, if you live in a country with a free market, then your income corresponds to the amount of utility you create.

This is why some video game streamers make more money than doctors. It’s because they create more utility.

If this concept bothers you, it’s because we were misinformed when growing up. We were misinformed by our parents, teachers, aunts, uncles, elders, etc. Everyone rammed this idea down our throats that getting a great education would lead to more money. This might be true if all you ever want is a 9-5 job, but the world is transitioning to a gig economy of part-time workers and content creators. We have jobs like YouTuber. Twitch streamer. Uber driver. People make their own crafts and sell them on Etsy. None of this requires post-secondary education.

The bottom line is: If you want to make more money, you need to create more utility. You need more eyeballs. More viewers. More customers. You need to create products and services that provide as much utility as possible.

Just look at a billionaire like Bill Gates. Microsoft products are used by billions of people. In the last 45 years Microsoft has created a lot more utility than your local baker. More than 1.3 billion devices run Windows 10. And that’s why Bill Gates is a billionaire, and the old guy that makes your sourdough is not.

It doesn’t matter what your job is, you can always create more utility.

If you’re a doctor, you could start a YouTube channel. Invent a product. Start a business. You could offer to talk on podcasts or TV shows. There’s always a way to make people happier.

You are not your level of education, but you are your level of utility.

So, get out there and enrich the lives of others. Make the world a better and happier place. Create a ton of utility and you will become rich. I guarantee it. The proof is in the pudding with the higher utils.

Thanks for reading and don’t forget to follow us on Twitter.

(Want to read more about utility? Here’s an article on how to buy the perfect gift.)