ad astra per alia porci

Taleb, you are a genius.
May 12, 2007, 4:11 pm
Filed under: miscellaneous, the arts

I am currently only half way (Chapter 9) through Nicholas Nassim Taleb’s latest book The Black Swan: The Impact of the Highly Improbable, which is the sequel to the fantabulous Fooled By Randomness and I am actually bothering to write a post to gush about just how great I think the book is.

Once again Taleb manages to open my eyes to the very human inability to grasp probabilities and the various mental quirks we have that reduces our ability to grasp the role of chance and randomness in our lives. The book confirms some ideas I already had regarding the role of randomness in our lives and for most of the time gives many perspectives on the same subject.

Taleb’s book is based on two pillars of thought that reinforces each other: the problem of induction and the human inability to view empirical reality without biases.

The problem of induction has plagued philosophy and scientific thought ever since David Hume first used his example of the black swan in his writing. The simple explanation goes like this. Everyday, you might observe white swans in the lake outside your house in Europe. This might lead you to the conclusion that all swans are white. Then one day, you just happen to move to Australia, and when you look out the window of your house, you see a bunch of black swans. Which refutes the knowledge that you have arrived at through inductive methods. The problem with induction is that one can never ever be totally sure of the absolute truth and reliability of the conclusions derived through observations and inductive reasoning.

The problem of induction is related to our inherent biases when it comes to judging the impact of probability in our lives when it is combined with the flaws of the human (and very primitive) mind that has not evolved too much. Take the example of the fallacy of “beginners’ luck” in gambling, as cited in the book. Beginners’ luck do not exist because of the survivorship bias. If a new guy play one game and wins, he is said to be “lucky” or to have “skill”, but one cannot make any conclusions because of this single observation. And if the guy loses at the next round, he will probably quit. Those who keep winning will stay, and they are the ones who are most visible to most gamblers. This lead them to the flawed conclusion that beginners have all the luck, since they do not take into account the beginners who lose at their first games and subsequently leave the casino.

Of course, Taleb cites many flaws in human judgement of probabilistic outcomes. I am recording some here as a means of quick reference:

  1. Silent evidence: the selecting only positive outcomes and ignoring “failures” and negative outcomes. e.g. Assuming that to be a millionaire and successful entrepeuner one must possess certain qualities like preseverance and drive when those who fail to become successful have these qualities too. Basically ignoring evidence that states otherwise, hencing leading to false conclusions because positive evidence stands out much more than “non-evidence”.
  2. Confirmation bias: looking for evidence that supports a hypothesis, hence leading us to ignore evidence suggests the contrary.
  3. Treating absence of evidence as evidence of absence: Not having evidence that something is there doesn’t mean it is not there at all.
  4. The narrative fallacy: The human tendency to simplify reality and impute set chains of causation to make random event seem less random through the concoction of narratives. e.g. Historians.

There are more points but these are the main ones.

Humans like the tangible, the observable, the positive. Hence we tend to ignore the intangible, the unobserved, the non-event. Hence negative empiricism is a good way to compensate for biases by telling us that what is not true. Observing that green pens exist leads one to the conclusion that it’s wrong to believe that all pens are non-green. We almost always know what is wrong more confidently than what is right.

One of the paragraphs that touches me most is the one at the end of Chapter 8, in which Taleb wrote about the main problem about the present education system in most countries. Students are made too often to impute causations in events that they study, to simplify complex events by framing them awkwardly to fixed chains of causation.

This is one serious problem that has been plaguing the Singaporean education system. For example in History, students are made to write about the most important factor that led to say, the outbreak of World War II. Or the main reasons why Hitler was about to rise to power in Germany. Or how one event/factor/person caused the rise/fall/destruction/outbreak of X event. It is really a load of bull because firstly students are made to over-simplify reality, and secondly they are trained to give untruthful and unrigorous opinions and reasons without much thinking and research.

Which leads me to think about just how predictable world events and history is in general. Things always somehow seem to make sense when looked at backwards. Hindsight bias is everywhere in the study of history; historians magically fit seemingly-sound explanations for every historical event without ever pondering the non-linearity of the events. Think about it: if the world is really as predictable as it is shown to be in textbooks, why can’t historians predict historical events before it happens?

As I write this post, I flipped the papers and realised the recent tragedy of two of our national servicemen losing their lives in an accident in a training base in Taiwan. Months before, an old man died of infection by flesh-eating bacteria after being pricked by a crab. I can’t help but think that the world is truely a random place.

Even my own existence is a product of chance. For Earth to exist and the proper ecological conditions to exist for life to prosper, the Earth must be at precise distance from the Sun. For me to exist, the correct sperm must meet the correct egg. For the sperm and egg to meet, my parents must marry. For them to marry, they must somehow meet each other first. Of course, I am simplifying the chains of causation through my narrative here. For that I must apologise because it greatly understates the role of chance. But language and narration seems hard-wired in us and it seems to be the only way we can articulate and described an otherwise fluid and infintely complex reality, isn’t it?


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