Antifragility

hi i want to talk to you today about the concept of anti-fragility it is the core of naseem nicholas taleb's work it's something that is an unusual concept he had to invent a name for it because he couldn't think of anything that represented the opposite of fragility there is a kind of spectrum here from fragility on the one side something that breaks if it's subject to stress or at least is weakened by stress is weakened by volatility variation risk uncertainty to something that withstands that is robust or resilient and then on the other side something that is actually strengthened by those things so first let's talk about the family of things that are stressors that give us fragility or robustness or anti-fragility what are they well volatility is one word for it variation stress but also uncertainty and complexity ambiguity things that make it very difficult for the thing to know how to respond some people and we're going to talk much more about this later describe the current environment as a vuca environment by which they mean it is volatile it is uncertain it is complex and it is ambiguous well all of those things can be sources of stress for a system so we're talking about volatility we're talking about stress we're talking about risk we're talking about time since over time things tend to be subject to various kinds of variation to volatility to risk and perhaps to damage and so what happens to a system when it is subject to all of those things a fragile system breaks or at least weakens some things are fragile glass for example is something that is ordinarily understood to be fragile i didn't want to break a glass for you to demonstrate this so instead i decided to take something more fun an autumn tortilla chip one made with pumpkin flavor see in the shape of a little maple leaf well this is fragile when it's subject to stress it breaks and it's a good thing because it would be very hard to eat it if it didn't break when subject to stress delicious i had to restrain myself force myself to eat just one of those but now other things are not fragile usually we think of the opposite of fragility as something that does not break when subject to stress when subject to shocks when subject to volatility it's not harmed so what are things like that well that actually takes several different forms typically we think of those things as robust as firm as not being subject to that kind of shock great example is a hammer the whole point of a hammer is to be able to administer shocks to other things but to withstand those shocks on its own i can take this i can try to break it it's very firm it's very robust it does not bend it does not weaken it does not get damaged as a result of stress up to a point now of course i could subject this to such stress maybe i couldn't but something could subject it to such stress that it would actually break so even things that are robust or anti-fragile are not going to be robust or anti-fragile under all levels of stress but nevertheless up to a certain breaking point this thing is highly robust there's another form in which that non-fragility can take place resilience people often if asked to describe the opposite of fragility think in terms of not only robustness but resilience adaptability flexibility and there are things that are like that that subject to stress bend but do not break here's an example this is a plastic spatula and notice what happens if i subject it to stress it bends but it snaps right back and so it's something that is resilient it will respond to stress it will respond to forces into shocks but on the other hand it comes back to its original shape again at least if it's subject to stress up to a certain point presumably i could subject this to enough stress that it would break well anti-fragility is the opposite of fragility not just in the sense that it is not fragile it is resilient or its robust but instead it actually gets stronger as a result of stress being applied to it it responds to volatility to risk to shocks to stress by becoming stronger by becoming more resilient more robust and actually stronger in the sense that it is better capable of responding to all of those things now what's like that well in the inorganic world we don't really find things like that there are some new materials that are supposed to be like that but in general that's not something we find among the things in the world putting pressure on them stressing them shocking them does not make them stronger but living things are often like this they get stronger as a result of stress think about the way you build muscle you don't build muscle by avoiding stress by avoiding volatility by avoiding variation instead you work out what you do is subject the muscle to stress so you might start out for example lifting very light weights like this very easy very light but as you lift such weights you get stronger and you build up to heavier weights and then you start lifting weights like this and the more you do this the more the muscle responds and becomes stronger now notice when you do this what you're doing is actually stressing the muscle even using up and destroying muscle fibers but the muscle builds itself back and in fact it doesn't just adapt to that level of stress it adapts to heavier levels of stress now this is a 30 pound dumbbell that's the heaviest i have at home if i were in the gym i'd be using 45 or 50 pound dumbbells but as i work out i gradually get stronger and am able to lift heavier and heavier weights and why does that happen the muscle responds and tries to adapt not just to the stress that it's been subject to but to a little bit more so that it can handle that and maybe a little additional stress so in general that kind of progressive weight training where you keep adding a bit of weight or you keep adding a bit of intensity you keep adding a few more reps all of those things are ways of building your strength building your endurance making yourself stronger well it's not just muscles that are like that groups of people can be like that too organizations can be like that societies can be like that they can get stronger as a result of stress risk uncertainty volatility or they can get weaker they can even be broken so how do we develop systems that are stronger that are anti-fragile not fragile but not even just robust or resilient but actually get stronger as the result of stress there's an important question here what is it that makes natural systems natural systems like human bodies or like many cases societies or muscles stronger as a result of stress what makes that possible of course there are biochemical explanations but i'm looking for something different an anti-fragile system loves stress it loves risk it loves shocks it responds to them and gets stronger and what makes that possible is in part the fact that it builds itself back it strengthens itself to handle not only that level of stress but the next level of stress and so it builds itself a design margin it creates a design margin so that it realizes if i'm going to be subject to that level of stress i don't want that to be maximum effort i don't want that to put i don't want that to be the kind of thing that puts me at risk of breaking instead i want a margin of safety so that i can be ready for a little more that's what enables us to get stronger as we lift weights not just to restore ourselves to where we were but actually improve and the same thing is true for running or building endurance the same thing is true of societies the more problems you can handle the better you are at handling problems the same thing is true of intelligence if you simply sit there and don't think about anything you're not getting smarter you're not only not getting smarter you're getting dumber in fact i used to have a saying if you're not getting smarter you're getting dumber why because your brain is like a muscle it's something that has to be used to get better to get stronger to get more capable so intelligence is something you have to use and the more you use it the more problems you solve the better you become a problem solving and again there's a bit of a design margin your brain adapts not only to solve the kind of problem you're dealing with but it starts thinking about other aspects of the issue and in short becomes better able to solve a harder problem next time so the same thing can happen to us intellectually as happens to us physically in every case it's because we build in that design margin teleps says something very important here i think we're in general better at doing than we are at understanding at knowing at thinking and so he says i want to be able to live and thrive in a world that i don't understand if i have to rely to survive or to thrive or to get better on my intellectual abilities i'm going to in a lot of cases be in trouble why because the world is a vuca world it is volatile it is uncertain it is complex and that complexity often gives it a kind of chaotic character so that small changes can lead to large effects and finally it's ambiguous it's very hard to interpret or understand i want to be able to thrive in a world i don't understand and so i want to make myself the sort of being that can get stronger as a result of stress as a result of uncertainty and risk and i want to make systems that can withstand stress too not only survive it but get stronger as a result of it now when i think through these problems i realize that it's harder than it looks sometimes i know what to do i know how to for example work out a muscle so that it becomes stronger i can understand something about how to develop my ability to solve differential equations let's say by practicing and by encountering new kinds of differential equations by studying various kinds of solutions to various kinds of problems i can get better at certain intellectual tasks the way i can get better at certain physical tasks there are going to be problems i can't solve in that sort of way where it's not clear to me how to do it why is this in part it's because the world is complex and here i don't just mean complicated it's not just that well it's intricate and i have to think really hard to think about all the aspects of the problem it's because there are too many aspects that interact with other aspects of the problem and so one small change over here can lead to effects over here in ways that are really impossible for me to anticipate or understand once i see that systems tend to be like this not just human bodies but even more so societies organizations corporations all sorts of things that surround us i begin to realize that it's very difficult to predict the effects of what i do now sometimes it's very easy if i were to drop that weight on my toe something i once did actually not a dumbbell but um i didn't fasten securely the uh a weight on a barbell and it fell off and hit my toe that was no fun and if somebody drops a 30 pound weight on my toe i kind of can predict what's going to happen it's going to hurt it's not going to be a pretty picture and so yes sometimes we can predict things because it's quite a simple process but in other cases it's very difficult make a change in an organization what impact will that have on the rest of the organization it's often a very difficult thing to predict because that person's change affects this person affects that person and so on there's a chain of these effects all through the system very difficult to anticipate the final result systems are often so complex and the nature of randomness in the world is so significant that it really is mathematically impossible to predict the outcome of processes of that kind so what do we do about that we can't solve that kind of problem intellectually we simply do not have enough computing power to anticipate all the possible connections and all the possible effects so what do we do well one thing we can do is recognize what telev calls the lucretius problem that is to say we have to recognize that the past is of limited usefulness in allowing us to predict the future we tend to think that the future is going to be like the past in fact david hume says that's the foundation of all of our causal all of our inductive reasoning that the future will be like the past well in certain respects yes it's likely to be like the past but in other respects it won't be we face what talib calls the black swan problem the difficulty here is that sometimes very small changes add up to large effects the straw that broke the camel's back figuratively speaking and in those cases we can't anticipate which straw it is what small change will end up producing this large effect so it's really unpredictable when such an effect might occur they are rare they are the kinds of things that don't happen very often and so consequently we don't really have any statistics on when such events occur moreover they are unpredictable partly as a result of that there are too many things going on too many complicated interacting effects that we can't trace it all the world is really causally opaque not because we don't understand anything about causation not because hume is right that there's no sense to causation or there is no causation in the world but instead simply because the chains of causation and the patterns the webs of causation are so complex and so if there are those kinds of interdependencies very large numbers of interdependencies that we cannot trace or understand the world really looks causally opaque to us so even if there is a causal story that later we can tell we can't anticipate it we cannot predict it but the black swan event is something that has large effects how do we deal with that we recognize that we cannot anticipate such effects that the past is going to be a very limited benefit for helping us to understand the future what we have to do instead is build systems that will minimize our risk from such shocks not minimize risk overall mind you not try to squeeze risk into a small barrier or a small range what happens then is that the problems simply accumulate and that makes black swan events more likely to occur instead no we have to allow for volatility and build systems that become stronger as a result of volatility don't try to eliminate volatility don't try to eliminate stress that's like saying here's how you protect your health and get stronger never lift anything never do anything just sit there that's completely the wrong advice we don't want to eliminate volatility we want to respond to it in the right way we want to respond by making ourselves stronger as individuals but also as groups i want to extract two lessons from this the first is that this creates huge problems for top-down tampering for what he later refers to as naive interventionism you might think that you can intervene in a system in an organization and improve it and well sometimes you can but actually often those attempts at tampering at intervention are going to backfire once we understand the complexity the interdependencies of the parts of a system we can recognize that it is causally opaque and we understand the law of unintended consequences that is to say usually the unintended unanticipated unplanned consequences of an intervention are far more significant than the planned and intended consequences and so intervention is very dangerous it might produce the effect that we want but it's also likely to produce a whole host of additional effects ones we're not thinking about and that may turn out to be negative so we've got to be very careful in general that kind of top-down tampering is going to be a very dangerous sort of thing to engage in now that means that long-term forecasting that bailouts that permanent administrations that five-year plans that often mission statements and strategic planning to achieve the mission that all of those things can actually increase the fragility of a system they usually end up trying to act as if the future is predictable as if we can intervene and understand the effects of our intervention they tend to assume that things will go according to a pattern and the future will be like the past and there will be no black swan events all of those are unsafe assumptions and so that kind of administration which these days is all too common in fact it's been something that is you might say the disease of the 20th century and is persisting into the 21st it is something that creates danger it makes a system more fragile so we shouldn't be trying to do that now i'm not saying that forecasting planning mission statements and so on are always a bad idea but we've got to be very careful because it's easy to get sucked into the thought that the future is predictable that we can understand how to control volatility how to control risk and those are very dangerous assumptions sometimes short-term plans will work out sometimes we are in mediocristan as he'll refer to it and so we don't really have to worry a lot about fat tails and the danger of black swan events but when we're in a situation where the tail is fat where in effect lots of things are controlled by very low probability but high importance events all of those things become a very limited usefulness and in fact they're dangerous because they can mislead us into thinking we understand systems that we do not in fact understand so it's important to recognize the limitations of things like planning forecasting strategy meetings mission statements and all of that they have a place but they can lure you into thinking that you understand the present and can predict the future that's almost always wrong the second moral of the story here is well to think about nietzsche's phrase what doesn't kill me makes me stronger that's not always true a car accident is not usually something that makes you stronger it depends on the nature of the stress and the nature of the system i go to the gym i lift weights that makes my muscles stronger but i've also been in auto accidents they didn't make me stronger they made me weaker in various respects and so that's not something we can generally apply safely sometimes damage to you is really just damaged to you and you don't become stronger as a result though we can't therefore say that what doesn't kill me makes me stronger we can say what does kill me makes others stronger others can learn from my mistake so often a system becomes anti-fragile through the fragility of the parts how for example does a certain collection of businesses manage to become anti-fragile it's not because each one is anti-fragile each one does not necessarily become stronger as a result of a shock to its earnings let's say or a sudden increase in costs not at all in fact that business may go under or it may be weakened but others learn from the example so the entire system can become stronger as a result of the failure of some of the parts the same thing can be true of lots of other kinds of systems it's not that each part of the system becomes stronger as a result of stress being applied to it the system itself becomes stronger as certain of the weak parts get weeded out and as other parts learn from their example john stuart mill in on liberty defended liberty partly on the grounds of defending experiments in living he said we should allow people all sorts of experiments in living as long as they don't harm others why because the rest of us can learn from their example maybe their experiment will succeed and will learn something positive maybe it will fail and will learn what not to do maybe they will be completely destroyed it will be totally self-destructive but the system will become stronger because for one thing they'll be out of the picture and for another thing we'll all have learned the lesson of their mistakes so often it is the failure of the part that makes the whole stronger now that's a kind of brutal message we can end up saying so yes the anti-fragility of a system sometimes entails and results from the fragility of the parts in fact only insofar as the parts are fragile can the system become stronger a concept he'll talk about later and that i'll devote an entire video to is ergodicity and what that means in a nutshell is going to be the vulnerability of each of the parts what it's going to amount to is that we have to allow people to fail we have to allow some of the parts of this system to fail in order for the system itself to become stronger so sometimes it is not that the stress applied to a part makes that part stronger sometimes it's true but sometimes the system becomes stronger as a result of the stress to the part even if that part is damaged even if that part is destroyed the system might become stronger as a result and trying to protect all the parts may end up being a matter of preventing the system from becoming stronger protecting the parts sometimes increases the fragility of the hole

Channel: Daniel Bonevac

Views: 1,805

Rating: 4.9733334 out of 5

Keywords:

Id: lUHGUf9oX5M

Length: 23min 7sec (1387 seconds)

Published: Sun Nov 01 2020