Top Market Strategy

3.4 Replicated by Research

Pareto's extensive research confirmed that the distribution of inputs to outputs is widely observable, predictable, and logarithmic. More than 50 years after Pareto's discovery, Zipf found that word usage has an 80:20 equilibrium point and called his discovery the principle of least effort.3 In 2006, Newman defined a random sample of numbers as inputs and repeated numbers as outputs and discovered that their relationship replicated the Pareto distribution (Figure 2a) and a log of this distribution approximates a straight line (Figure 2b). Newman noted that this “occurs in an extraordinarily diverse range of phenomena.”4