Antifragile: Things that Gain from Disorder

by Nassim Nicholas Taleb

The northern Levant, roughly today’s northern part of Syria and Lebanon, stayed perhaps the most prosperous province in the history of mankind, over the long, very long stretch of time from the pre-pottery Neolithic until very modern history, the middle of the twentieth century. That’s twelve thousand years—compared to, say, England, which has been prosperous for about five hundred years, or Scandinavia, now only prosperous for less than three hundred years.

Contracts were enforced, and that is what governments are needed for the most. In

The effect was immediately visible: overnight the trading families moved to places such as New York and New Jersey (for the Jews), California (for the Armenians), and Beirut (for the Christians).

But while Lebanon had all the right qualities, the state was too loose, and by allowing the various Palestinian factions and the Christian militias to own weapons, it caused an arms race between the communities while placidly watching the entire buildup. There was also an imbalance between communities, with the Christians trying to impose their identity on the place. Disorganized is invigorating; but the Lebanese state was one step too disorganized. It would be like allowing each of the New York mafia bosses to have a larger army than the Joint Chiefs of Staff (just imagine John Gotti with missiles). So in 1975 a raging civil war started in Lebanon.

Economic life, too, seems to prefer war to prison. Lebanon and Northern Syria had very similar wealth per individual (what economists call Gross Domestic Product) about a century ago—and had identical cultures, language, ethnicities, food, and even jokes. Everything was the same except for the rule of the “modernizing” Baath Party in Syria compared to the totally benign state in Lebanon. In spite of a civil war that decimated the population, causing an acute brain drain and setting wealth back by several decades, in addition to every possible form of chaos that rocked the place, today Lebanon has a considerably higher standard of living—between three and six times the wealth of Syria.

“It seemed, wrote Machiavelli, that in the midst of murders and civil wars, our republic became stronger [and] its citizens infused with virtues. … A little bit of agitation gives resources to souls and what makes the species prosper isn’t peace, but freedom.”

Nation-states rely on centralized bureaucracy, whereas empires, such as the Roman empire and Ottoman dynasties, have relied on local elites, in fact allowing the city-states to prosper and conserve some effective autonomy—and, what was great for peace, such autonomy was commercial, not military. In reality, the Ottomans did these vassals and suzerains a favor by preventing them from involvement in warfare—this took away militaristic temptations and helped them thrive; regardless of how iniquitous the system seemed to be on the surface, it allowed locals to focus on commerce rather than war. It protected them from themselves. This is the argument brought by David Hume in his History of England in favor of small states, as large states get tempted by warfare.

in 1867, Maxwell modeled the behavior and showed mathematically that tightly controlling the speed of engines leads to instability.

Variations also act as purges. Small forest fires periodically cleanse the system of the most flammable material, so this does not have the opportunity to accumulate. Systematically preventing forest fires from taking place “to be safe” makes the big one much worse.

For Voltaire, the best form of government was the one tempered with political assassination.

The secular drop in premature deaths in society has deprived us of a naturalistic managerial turnover. Murder is the standard procedure for succession in the mafia

every time you visit a doctor and get a treatment, you incur risks of such medical harm, which should be analyzed the way we analyze other trade-offs: probabilistic benefits minus probabilistic costs. For a classic example of iatrogenics, consider the death of George Washington in December 1799: we have enough evidence that his doctors greatly helped, or at least hastened, his death, thanks to the then standard treatment that included bloodletting (between five and nine pounds of blood).

The famously mistreated Austro-Hungarian doctor Ignaz Semmelweis had observed that more women died giving birth in hospitals than giving birth on the street. He called the establishment doctors a bunch of criminals—which they were: the doctors who kept killing patients could not accept his facts or act on them since he “had no theory” for his observations. Semmelweis entered a state of depression, helpless to stop what he saw as murders, disgusted at the attitude of the establishment. He ended up in an asylum, where he died, ironically, from the same hospital fever he had been warning against. Semmelweis’s story is sad: a man who was punished, humiliated, and even killed for shouting the truth in order to save others. The worst punishment was his state of helplessness in the face of risks and unfairness. But the story is also a happy one—the truth came out eventually, and his mission ended up paying off, with some delay. And the final lesson is that one should not expect laurels for bringing the truth.

medical error still currently kills between three times (as accepted by doctors) and ten times as many people as car accidents in the United States. It is generally accepted that harm from doctors—not including risks from hospital germs—accounts for more deaths than any single cancer.

distributed iatrogenics, and it has been growing. It is easy to assess iatrogenics when the surgeon amputates the wrong leg or operates on the wrong kidney, or when the patient dies of a drug reaction. But when you medicate a child for an imagined or invented psychiatric disease, say, ADHD or depression, instead of letting him out of the cage, the long-term harm is largely unaccounted for.

To sum up, anything in which there is naive interventionism, nay, even just intervention, will have iatrogenics.

Perhaps the idea behind capitalism is an inverse-iatrogenic effect, the unintended-but-not-so-unintended consequences: the system facilitates the conversion of selfish aims (or, to be correct, not necessarily benevolent ones) at the individual level into beneficial results for the collective.

Greenspan’s actions were harmful, but even if he knew that, it would have taken a bit of heroic courage to justify inaction in a democracy where the incentive is to always promise a better outcome than the other guy, regardless of the actual, delayed cost.

Incidentally, those who do too much somewhere do too little elsewhere—and editing provides a quite fitting example.

As we will see, interventionism depletes mental and economic resources; it is rarely available when it is needed the most.

The corporate manager who avoids a loss will not often be rewarded.

Romans revered someone who, at the least, resisted and delayed intervention.

There is a Latin expression festina lente, “make haste slowly.” The Romans were not the only ancients to respect the act of voluntary omission. The Chinese thinker Lao Tzu coined the doctrine of wu-wei, “passive achievement.”

The supply of information to which we are exposed thanks to modernity is transforming humans from the equable second fellow into the neurotic first one. For the purpose of our discussion, the second fellow only reacts to real information, the first largely to noise.

The more frequently you look at data, the more noise you are disproportionally likely to get (rather than the valuable part, called the signal); hence the higher the noise-to-signal ratio.

And if you observe data on an hourly basis, as people immersed in the news and market price variations do, the split becomes 99.5 percent noise

which is why anyone who listens to news (except when very, very significant events take place) is one step below sucker.

Too much information would thus be too much stress, exceeding the threshold of antifragility. In medicine, we are discovering the healing powers of fasting, as the avoidance of the hormonal rushes that come with the ingestion of food. Hormones convey information to the different parts of our system, and too much of them confuses our biology. Here again, as with news received at too high a frequency, too much information becomes harmful—daily news and sugar confuse our system in the same manner. And in Chapter 24 (on ethics) I will show how too much data (particularly when it is sterile) causes statistics to be completely meaningless. Now let’s add the psychological to this: we are not made to understand the point, so we overreact emotionally to noise. The best solution is to only look at very large changes in data or conditions, never at small ones.

Consider that every day, 6,200 persons die in the United States, many of preventable causes. But the media only report the most anecdotal and sensational cases (hurricanes, freak accidents, small plane crashes), giving us a more and more distorted map of real risks.

When constrained systems, those hungry for natural disorder, collapse, as they are eventually bound to, since they are fragile, failure is never seen as the result of fragility. Rather, such failure is interpreted as the product of poor forecasting. As with a crumbling sand pile, it would be unintelligent to attribute the collapse of a fragile bridge to the last truck that crossed it, and even more foolish to try to predict in advance which truck might bring it down. Yet it is done all too often.

Obama’s mistake illustrates the illusion of local causal chains—that is, confusing catalysts for causes and assuming that one can know which catalyst will produce which effect.

Success brings an asymmetry: you now have a lot more to lose than to gain. You are hence fragile.

Stoic sage is someone who transforms fear into prudence, pain into information, mistakes into initiation, and desire into undertaking

Fragility implies more to lose than to gain, equals more downside than upside, equals (unfavorable) asymmetry

Antifragility implies more to gain than to lose, equals more upside than downside, equals (favorable) asymmetry

The first step toward antifragility consists in first decreasing downside, rather than increasing upside; that is, by lowering exposure to negative Black Swans and letting natural antifragility work by itself.

If a gambler has a risk of terminal blowup (losing back everything), the “potential returns” of his strategy are totally inconsequential.

Indeed, growth was very modest, less than 1 percent per head, throughout the golden years surrounding the Industrial Revolution, the period that propelled Europe into domination. But as low as it was, it was robust growth—unlike the current fools’ race of states shooting for growth like teenage drivers infatuated with speed.

For antifragility is the combination aggressiveness plus paranoia—clip your downside, protect yourself from extreme harm, and let the upside, the positive Black Swans, take care of itself. We saw Seneca’s asymmetry: more upside than downside can come simply from the reduction of extreme downside (emotional harm) rather than improving things in the middle.

With personal risks, you can easily barbell yourself by removing the chances of ruin in any area. I am personally completely paranoid about certain risks, then very aggressive with others. The rules are: no smoking, no sugar (particularly fructose), no motorcycles, no bicycles in town or more generally outside a traffic-free area such as the Sahara desert, no mixing with the Eastern European mafias, and no getting on a plane not flown by a professional pilot (unless there is a co-pilot). Outside of these I can take all manner of professional and personal risks, particularly those in which there is no risk of terminal injury.

The legendary investor Ray Dalio has a rule for someone making speculative bets: “Make sure that the probability of the unacceptable (i.e., the risk of ruin) is nil.”

Can you imagine that it took close to six thousand years between the invention of the wheel (by, we assume, the Mesopotamians) and this brilliant implementation (by some luggage maker in a drab industrial suburb)? And billions of hours spent by travelers like myself schlepping luggage through corridors full of rude customs officers. Worse, this took place three decades or so after we put a man on the moon.

(We said that the intellectual society rewards “difficult” derivations, compared to practice in which there is no penalty for simplicity.)

The story of the wheel itself is even more humbling than that of the suitcase: we keep being reminded that the Mesoamericans did not invent the wheel. They did. They had wheels. But the wheels were on small toys for children.

The same story holds for the steam engine: the Greeks had an operating version of it, for amusement, of course:

The history of medicine is littered with the strange sequence of discovery of a cure followed, much later, by the implementation—as if the two were completely separate ventures, the second harder, much harder, than the first. Just taking something to market requires struggling against a collection of naysayers, administrators, empty suits, formalists, mountains of details that invite you to drown, and one’s own discouraged mood on occasion.

In spite of the hype, what we call technologies have a very high mortality rate,

The wheel, born in the Middle East, seems to have disappeared after the Arab invasion introduced to the Levant a more generalized use of the camel and the inhabitants figured out that the camel was more robust—hence more efficient in the long run—than the fragile technology of the wheel. In addition, since one person could control six camels but only one carriage, the regression away from technology proved more economically sound.

The historian David Wooton relates a gap of two centuries between the discovery of germs and the acceptance of germs as a cause of disease, a delay of thirty years between the germ theory of putrefaction and the development of antisepsis, and a delay of sixty years between antisepsis and drug therapy.

William Harvey demonstrated the mechanism of blood circulation in the 1620s, one would have expected that such theories and related practices should have disappeared. Yet people continued to refer to spirit and humors, and doctors continued to prescribe, for centuries more, phlebotomies (bloodletting), enemas (I prefer to not explain), and cataplasms (application of a moist piece of bread or cereal on inflamed tissue). This continued even after Pasteur’s evidence that germs were the cause of these infectious diseases.