The pareto principle is an heuristic that follows a simple ratio that is apt to appear in many cause-and-effect relationships.
The original definition is specifically about causes and consequences (80% of consequences come from 20% of causes).
- About 80% of the stock market is in the hands of the top 20% of investors.
- About 80% of a non-profit's funding comes from about 20% of donors. You could also approximate that the lower 80% of donors contribute only about 20% of the total funding.
In fact, the real numbers may be a little different, but they often follow the 80/20 trend well enough to make this not a rule but a good heuristic.
The ratio is almost like a natural law and can be applied to plenty of other contexts.
Distribution of world GDP, 1989 (Source)
Using this table from Wikipedia,
| Quintile of population | Income |
| Richest 20% | 82.70% |
| Second 20% | 11.75% |
| Third 20% | 2.30% |
| Fourth 20% | 1.85% |
| Poorest 20% | 1.40% |
We see right away about 80% of the income is in the hands of the top 20%. And at the same time, the collection of everyone poorer (the bottom 80%) holds 17.3%, just shy of 20% of the total income.
When I was a UX designer, I used to say 80% of features are used by only 20% of users and there's a special 20% of features that are used by 80% of users.
I like to think there are some personal applications of this context. Maybe only 20% of what I own is in the top 80% of what I really need and somewhere in the bottom of that remaining 80% are things I need to just throw out. That means about 80% of what I own fall into the bottom 20% of what I really need. It doesn't take me to what those things are but it's a good frame for making inescapable conclusions about tidying up.
In dating, mathematics aren't the first thing we think of, but there's something comforting about telling ourselves it's all a numbers game when we get discouraged going on date after date. If this doesn't apply to you, trade dating for job interviewing. Is there an 80/20 rule to apply there too?
Personally, the 80/20 rule is a heuristic for encouragement. It reminds me that there is a sort of natural law guiding the inevitability of the things I want to happen actually happening.