The purpose of this post is to highlight the huge impact social skills can have on wealth inequality by showing how much wealth is gained when you have the skills to make and maintain friends, and how much is lost when you don’t have social skills.

For this exercise, we forget the humanity of friendship and instead focus only on the financial aspects.  In that sense, friendship can be modeled as a subscription model business with an initiation fee.

Invest: Money, Time, Thought, Emotion, Options, and Opportunities

Return on Investment: access to resources, social and career network, all at extremely discounted prices.  Asking a friend for help is cheaper than paying a professional full price for help.  Meeting someone you have mutual friends with costs less resources than meeting a stranger.

Also, your wealth now increases indirectly through your friends: if each friend earns 10k per year and you have 10 friends, then your network is earning 100k per year.  If your friends gain skills, you indirectly gain them too: you now have easy access to expert skills at a discounted price.  You are encouraged to help each other because you all benefit together as friends.

This is in contrast to a life without friends, where everything is full price, and you have no incentive to help others because it won’t benefit you, it will just raise the competition and the prices on you, making your life more difficult.

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