Sunday, February 5, 2012

Black Swan Notes

We will see that, contrary to social-science wisdom, almost no discovery, no technologies of note, came from design and planning—they were just Black Swans. The strategy for the discoverers and entrepreneurs is to rely less on top-down planning and focus on maximum tinkering and recognizing opportunities when they present themselves. So I disagree with the followers of Marx and those of Adam Smith: the reason free markets work is because they allow people to be lucky, thanks to aggressive trial and error, not by giving rewards or "incentives" for skill. The strategy is, then, to tinker as much as possible and try to collect as many Black Swan opportunities as you can.


What I call Platonicity, after the ideas (and personality) of the philosopher Plato, is our tendency to mistake the map for the territory, to focus on pure and well-defined "forms," whether objects, like triangles, or social notions, like Utopias (societies built according to some blueprint of what "makes sense"), even nationalities. When these ideas and crisp constructs inhabit our minds, we privilege them over other less elegant objects, those with messier and less tractable structures (an idea that I will elaborate progressively throughout this book).

Platonicity is what makes us think that we understand more than we  actually do. But this does not happen everywhere. I am not saying that Platonic forms don't exist. Models and constructions, these intellectual
maps of reality, are not always wrong; they are wrong only in some specific applications. The difficulty is that a) you do not know beforehand (only after the fact) where the map will be wrong, and b) the mistakes can lead to severe consequences. These models are like potentially helpful medicines that carry random but very severe side effects.

Note that I am not relying in this book on the beastly method of collecting
selective "corroborating evidence." For reasons I explain in Chapter
5, I call this overload of examples naïve empiricism—successions of
anecdotes selected to fit a story do not constitute evidence. Anyone looking
for confirmation will find enough of it to deceive himself—and no
doubt his peers.* The Black Swan idea is based on the structure of randomness
in empirical reality.

*It is also naïve empiricism to provide, in support of some argument, series of eloquent
confirmatory quotes by dead authorities. By searching, you can always find
someone who made a well-sounding statement that confirms your point of view—
and, on every topic, it is possible to find another dead thinker who said the exact
opposite. Almost all of my non-Yogi Berra quotes are from people I disagree with.