Antifragile: Things That Gain from Disorder [Englisch] [Gebundene Ausgabe]

*A full executive summary of this book will be available at newbooksinbrief dot com, on or before Monday, December 17, 2012.

The concept of fragility is very familiar to us. It applies to things that break when you strike or stretch them with a relatively small amount of force. Porcelain cups and pieces of thread are fragile. Things that do not break so easily when you apply force to them we call strong or resilient, even robust. A cast-iron pan, for instance. However, there is a third category here that is often overlooked. It includes those things that actually get stronger or improve when they are met with a stressor (up to a point). Take weight-lifting. If you try to lift something too heavy, you’ll tear a muscle; but lifting more appropriate weights will strengthen your muscles over time. This property can be said to apply to living things generally, as in the famous aphorism ‘what doesn’t kill you makes you stronger’. Strangely, we don’t really have a word for this property, this opposite of fragility.

For author Nassim Nicholas Taleb, this is a real shame, for when we look closely, it turns out that a lot of things (indeed the most important things) have, or are subject to, this property. Indeed, for Taleb, pretty much anything living, and the complex things that these living things create (like societies, economic systems, businesses etc.) have, or must confront this property in some way. This is important to know, because understanding this can help us understand how to improve these things (or profit from them), and failing to understand it can cause us to unwittingly harm or even destroy them (and be harmed by them). So Taleb has taken it upon himself to name and explore this curious property and its implications; and in his new book ‘Antifragile: Things That Gain from Disorder’ Taleb reports on his findings.

As the title would suggest, what Taleb has found is that most complex systems not only gain from small stressors, but they are designed to gain more when these stressors are distributed irregularly, or randomly. This point is more difficult to accept because we tend to dislike disorder and randomness. Disorder can be frightening, because unpredictable, and is therefore not something that we readily welcome. So what we often do is attempt to remove the random and disorderly from our systems, and make them smooth. For example, we may try to take the boom and bust out of the economy, and instead aim for a gradual upward trend.

For Taleb, though, this is a big mistake, because while removing the small shocks in a complex system may create stability for a time, it actually upsets the system and makes it prone to major shocks in the long term. What’s more, unlike the small shocks (that refine and improve the system), the major shocks are usually damaging, and can even destroy the system. So removing the small shocks from a complex system doesn’t create stability; rather, it creates the illusion of stability. In the economy, for instance, you get a long period of stability followed by a major crash.

This phenomenon is not just confined to the economy. Indeed, Taleb maintains that it is the spirit of the age to believe that we can remove the disorder from any system, and render it orderly, smooth and predictable. We are almost always mistaken in this, and end up creating systems that are prone to major damage and even outright destruction (in Taleb’s language, we ‘fragilize’ these systems). We call the damaging and destructive episodes Black Swan events (Taleb himself coined the term). Better it would be by far, Taleb argues, to accept and even welcome a certain amount of disorder, randomness and jaggedness in our lives and systems, and put ourselves in a position to profit from the unpredictable, rather than eradicate it.

On this last point, Taleb maintains that it is indeed possible to profit from the unpredictable (without having to actually predict any specific thing—which is next to impossible in the realm of the complex anyway). We simply need to recognize what systems are fragile (and therefore prone to collapse), and what systems are antifragile (and therefore prone to grow stronger from stressors), and get out of the way of the former, and put our faith in the latter. This applies not only to large, overarching systems like corporations, economic systems and political societies, but our own bodies and minds.

Taleb presents a very intriguing position, and offers up some very interesting evidence in support of it (though at times we may wonder whether he is resorting to the same kind of cherry-picking of information that he accuses others of). Also, Taleb has a lot to say, and a bone to pick, so his style often comes across as arrogant—even bombastic. Some will like this, while others will be annoyed (I didn’t mind it, but did not think it truly added anything for the most part). Also, Taleb jumps around and repeats himself often. This was more annoying to me than his style, but ultimately I think the content rose well above this, and I truly enjoyed the book, and think it deserves a read. A full executive summary of the book will be available at newbooksinbrief dot com, on or before Monday, December 17; a podcast discussion of the book will be available shortly thereafter.

In this book Nassim Taleb applies his observations and theories from "The Black Swan Event" and "Fooled By Randomness" onto different aspects of life. By that he more or less constructs a philosophy for life. As in the previous books his writing is very vivid and easy to read. At times he cannot help but directly attack his intellectual opponents (or rather enemies). In these instances his writing becomes kind of polemic. I agree with his arguments, and his anger may be justified but I suspect the book would feel more credible if he had left some of this out.

So should you read this?

If you want hear a compelling argument against modernism, interventionism, and the contemporary manifestations of fortune-telling from the point of view of a rational skeptic - then yes. If you just want to become familiar with the central idea of Nassim Taleb then you would be better off reading one of his other two books. If you already have read one of them and liked it then chances are you will like this one as well.

Exposing the fallacies of over-hyped risk management and doing so in an amusing manner may help in avoiding the next crisis. On the downside I found too many repetitions, over-simplified and sometimes inexact mathematical explanations, and even negative name-dropping can become boring.