Critical Article Review: Taleb – ‘The Black Swan: Why Don’t We Learn that We Don’t Learn?’
Critical Article Review
Russell Beck, Submitted on 01-28-2009
Article Citation:
Taleb, Nassim Nicholas. “The Black Swan: Why Don’t We Learn that We Don’t Learn?” Highland Forum 23: First Draft 11 (2003): 57-66. United States Department of Defense Highlands Forum.
Author Background:
A trader turned philosopher, Taleb illustrates how poorly our past experience of the world can prepare us for sudden, unexpected, epochal events. The Black Swan: The Impact of the Highly Improbable, gave a name to these events, both positive and negative Black Swans. He has said that the current market turmoil is a negative Black Swan and should have been predicted. The fund he advises, Universa Investments LP, has gained upwards of 50% this year on the back of strategies intended to manage them (Time). In his own words, I am interested in how to live in a world we don’t understand very well –in other words, while most human thought (particularly since the enlightenment) has focused us on how to turn knowledge into decisions, I am interested in how to turn lack of information, lack of understanding, and lack of “knowledge” into decisions –how not to be a “turkey” (Taleb).
The Eight Elements of Thought
1. Purpose:
To present the Black Swan problem and review the insights from a collection of disciplines in the behavioral and cognitive sciences on the subject of the perception of harmful outcomes.
2. Question at issue:
Why don’t we learn that we don’t learn?
How do the behavioral and cognitive sciences relate to the perception of harmful outcomes?
3. Point of view:
Black Swans cannot be predicted (if they could, they wouldn’t be Black Swans), and the past cannot be used to study them because of hindsight bias. Behavior is not necessarily determined by cognition. Also, cognition itself is subjected to distortions and biases. For the cognitive sciences the author covered, 1) the heuristics and biases approach (in empirical psychology), 2) recent neurobiology of emotions and risk avoidance, 3) evolutionary perspectives.
An opposing point of view would be that all catastrophic events can be predicted, or foiled, with the correct intelligence. After 9/11 it was discovered that Social Network Analysis could have been used to connect all the dots to stop the plot. However, there is major hindsight bias here. Most of the hijackers did nothing illegal before they boarded the planes. Therefore, they couldn’t have been arrested anyway.
4. Concepts:
There are positive and negative Black Swans
Cognitive Sciences have relevance to risk perception
The media plays into the scorn of the abstract
5. Information:
A Black Swan contains three parts: disproportionately large impact, small but incomputable probability based on information available prior to the incidence, and a surprise effect. Second, we don’t make mistakes in probability; it is that these errors are systematic. Next, when a person is a certain percentage sure his answer is right, he is actually right less than the percent of the time. Finally, based on studies on the brain, emotions tie directly to risk. In the subjects he wasn’t an expert in, the author quoted many different studies extensively.
6. Assumptions:
The author assumes that Black Swans will continue to happen and that we won’t be able to predict them. Also, he assumes that our hindsight biases impact how we view an event that already occurred. Finally, he assumes that our social lives are a type 2 environment, one where a small number of events contributes to randomness.
7. Interpretation and inference:
Taleb uses his Black Swans, along with the results of studies in the field of cognitive sciences, to show how these extreme events link to risk and security.
8. Implications:
Researchers could try to predict Black Swans, or go back to those that have already happened and try to find a constant model of how they occurred. If this happened, however, those events wouldn’t meet the specifications of a Black Swan. Also, the use of the brain and its links to the perception of risk could be looked into more deeply after reading what Taleb has thrown out there.
Intellectual Standards
1. Clarity: The author was relatively clear. I was on the same level as him when he described Black Swans, but when he delved into the cognitive, I wanted him to come back to the Black Swan more and link them all together in the conclusion
2. Accuracy: I found the article to be very accurate. He is describing his own idea, and drawing from many different studies to support the other fields he is not an expert in.
3. Precision: The article could have been more precise. It covered a broad range of topics in a short, easy to read manner, but they weren’t tied back together enough for me.
4. Relevance: The article was very relevant to the course. Both Black Swans and studying the brain to see how we perceive risk will impact anybody in the risk field at some point.
5. Depth: The article does not go into great detail, but provides great depth on the subjects. Because this author created the idea of the Black Swan, his explanation of it was very satisfying; he also did not get too technical on the cognitive science details. I didn’t feel like I was reading a medical journal that I would never understand.
6. Breadth: The breadth of this article is its strength. It covers a pretty broad amount of topics compared to normal articles about risk.
7. Logic: The author’s reasoning is solid. I completely follow his jumps into the sciences, even though he didn’t explicitly link them up very well.
8. Significance: The article can be very significant in the security field. If studying the brain becomes the next big thing in the field, and the idea of Black Swans continues to be a big hit, this author and his ideas would have had a huge impact.
9. Fairness: The article doesn’t really present any opposing points of views. It doesn’t mention any arguments that previous Black Swans could have been predicted. But, I didn’t feel that it took anything away from the article.
Works Cited
Morrison, Tim. “Nassim Nicholas Taleb .” TIME.com. 24 Oct. 2008. 28 Jan. 2009 <http://www.time.com/time/business/article/0,8599,1853531,00.html>.
Taleb, Nassim N. Taleb’s HomePage. 28 Jan. 2009 <http://www.fooledbyrandomness.com/>.
DearRussel,
You mentioned that there are positive and negative “Black Swans”, how can you ever know if this thesis of yours is always true? Black swan, already implies that its “Black”. Every evolutionary event in our lives, such as WWI, Financial crisis, techno-revolution, they are all Black Swans, if we consider first two examples mentioned as negative, Black Swans, can you say that techno-progress is positive BS? The fact that it made better and easier access to information, communication etc, YES it is all good, however can you argue that to certain extent it did modify our consciousness. It degraded our life-communicational skills and at it also has a bad impact on out health.
I mean, I liked your analysis, however BS is also written by philosopher, who focuses on ToK(theory of knowledge, therefore it is not this easy to claim your thesis, or your hypothesis of analyses), but taking into consideration it is your own point of view, and that any point of view can be argued, some might agree.
Respectfully,
A>F>A.