Skin in the Game: Hidden Asymmetries in Daily Life

by Nassim Nicholas Taleb

In that light—that of (causal) opacity and revelation of preferences—the Intelligence of Time under skin in the game even helps define rationality—the only definition of rationality I found that doesn’t fall apart under logical scrutiny. A practice may appear to be irrational to an overeducated and naive (but punctual) observer who works in the French Ministry of Planning, because we humans are not intelligent enough to understand it—but it has worked for a long time. Is it rational? We have no grounds to reject it. But we know what is patently irrational: what threatens the survival of the collective first, the individual second. And, from a statistical standpoint, going against nature (and its statistical significance) is irrational. In spite of the noise funded by pesticide and other technological companies, there is no known rigorous definition of rationality that makes rejection of the “natural” rational; to the contrary. By definition, what works cannot be irrational; about every single person I know who has chronically failed in business shares that mental block, the failure to realize that if something stupid works (and makes money), it cannot be stupid. A system with skin-in-the-game requirements holds together through the notion of a sacrifice in order to protect the collective or entities higher in the hierarchy that are required to survive. “Survival talks and BS walks.” Or as Fat Tony would put it: “Survival tawks and BS wawks.” In other words: What is rationa...