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“all swans are white” is equivalent to “all nonwhite objects are not swans.”
or that someone is innocent of murder because we have never seen him kill.
we come equipped with mental machinery that causes us to selectively generalize from experiences (i.e., to selectively acquire inductive learning in some domains but remain skeptical in others).
Indeed our environment is a bit more complex than we (and our institutions) seem to realize. How? The modern world, being Extremistan, is dominated by rare—very rare—events. It can deliver a Black Swan after thousands and thousands of
white ones, so we need to withhold judgment for longer than we are inclined
It takes a lot more than a thousand days to accept that a writer is ungifted, a market will not crash, a war will not happen, a project is hopeless, a country is “our ally,” a company will not go bust, a brokerage-house security analyst is not a charlatan, or a neighbor will not attack us. In the distant past, humans could make inferences far more accurately and quickly.
Furthermore, the sources of Black Swans today have multiplied beyond measurability.*
Out-of-print books deliver many surprises.
* As I said in the Prologue, the likely not happening is also a Black Swan. So disconfirming the likely is equivalent to confirming the unlikely.
This confirmation problem pervades our modern life, since most conflicts have at their root the following mental bias: when Arabs and Israelis watch news reports they see different stories in the same succession of events.
Once your mind is inhabited with a certain view of the world, you will tend to only consider instances proving you to be right.
interlocking relationships between economic entities and the intensification of the “network effects” that we will discuss in Part Three.
Chapter Six THE NARRATIVE FALLACY
ON THE CAUSES OF MY REJECTION OF CAUSES
“You are a lucky man; you presented in such a comprehensive way the effect of chance on society and the overestimation of cause and effect. You show how stupid we are to systematically try to explain skills.”
had you grown up in a Protestant society where people are told that efforts are linked to rewards and individual responsibility is emphasized, you would never have seen the world in such a manner. You were able to see luck and separate cause and effect because of your Eastern Orthodox Mediterranean heritage.”
The fallacy is associated with our vulnerability to overinterpretation and our predilection for compact stories over raw truths.
He had to invent a cause. Furthermore, he was not aware of his having fallen into the causation trap, nor was I immediately aware of it myself.
The narrative fallacy addresses our limited ability to look at sequences of facts without weaving an explanation into them, or, equivalently, forcing a logical link, an arrow of relationship, upon them. Explanations bind facts together.
Where this propensity can go wrong is when it increases our impress...
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Information wants to be reduced.
SPLITTING BRAINS
not theorizing is an act—that theorizing can correspond to the absence of willed activity, the “default” option. It takes considerable effort to see facts (and remember them) while withholding judgment and resisting
explanations.
yourself.) Even from an anatomical perspective, it is impossible for our brain to see anything in raw form without some interpretation.
Post hoc rationalization. In an experiment, psychologists asked women to select from among twelve pairs of nylon stockings the ones they preferred. The researchers then asked the women their reasons for their choices. Texture, “feel,” and color featured among the selected reasons.
It is key that, as we saw with the vignette of the Italian scholar, brain functions often operate outside our awareness.
What makes nontheorizing cost
you so much more energy than theorizing? First, there is the impenetrability of the activity. I said that much of it takes place outside of our awareness: if you don’t know that you are making the inference, how can you stop yourself unless you stay in a continuous state of alert?
It appears that pattern perception increases along with the concentration in the brain of the chemical dopamine.
A higher concentration of dopamine appears to lower skepticism and result in greater vulnerability to pattern detection;
The person becomes vulnerable to all manner of fads, such as astrology, superstitions, economics, and tarot-card reading.
my point is that there is a physical and neural correlate to such operation and that our minds are largely victims of our physical embodiment. Our minds are like inmates, captive to our biology, unless we manage a cunning escape.
There is another, even deeper reason for our inclination to narrate, and it is not psychological. It has to do with the effect of order on information storage and retrieval in any system,
The first problem is that information is costly to obtain. The second problem is that information is also costly to store—like real estate in New York. The more orderly, less random, patterned, and narratized a series of words or symbols, the easier it is to store that series in one’s mind or jot it down in a book so your grandchildren can read it someday.
Finally, information is costly to manipulate and retrieve.
Compression is vital to the performance of conscious work.
And, as we can see here, a pattern is obviously more compact than raw information. You looked into the book and found a rule.
We, members of the human variety of primates, have a hunger for rules because we need to reduce the dimension of matters so they can get into our heads.
The more random information is, the greater the dimensionality, and thus the more difficult to summarize. The more you summarize, the more order you put in, the less randomness. Hence the same condition that makes us simplify pushes us to think that the world is less random than it actually is.
And the Black Swan is what we leave out of ...
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Think of the world around you, laden with trillions of details. Try to describe it and you will find yourself tempted to weave a thread into what you are saying. A novel, a story, a myth, or a tale, all have the same function: they spare us from the complexity of the world and shield us from its randomness.
The very same desire for order, interestingly, applies to scientific pursuits—it is just that, unlike art, the (stated) purpose of science is to get to the truth, not to give you a feeling of organization or make you feel better. We tend to use knowledge as therapy.
As we can remember it with less effort, we can also sell it to others, that is, market it better as a packaged idea. This, in a nutshell, is the definition and function of a narrative.
REMEMBRANCE OF THINGS NOT QUITE PAST
Our tendency to perceive—to impose—narrativity and causality are symptoms of the same disease—dimension reduction.
But memory and the arrow of time can get mixed up. Narrativity can viciously affect the remembrance of past events as follows: we will tend to more easily remember those facts from our past that fit a narrative, while we tend to neglect others that do not appear to play a causal role in that narrative. Consider that we recall events in our memory all the while knowing the answer of what happened subsequently.
Conventional wisdom holds that memory is like a serial recording device like a computer diskette. In reality, memory is dynamic—not static—like a paper on which new texts (or new versions of the same text) will be continuously recorded, thanks to the power of posterior information. (In a remarkable insight, the nineteenth-century Parisian poet Charles Baudelaire compared our memory to a palimpsest, a type of parchment on which old texts can be erased and new ones written over them.)
you remember the last time you remembered the event and, without realizing it, change the story at every subsequent remembrance.
We continuously renarrate past events in the light of what appears to make what we think of as logical sense after these events occur.
