Hedging risk

“Baseball, business, these are games of cycles. What you want is to minimize the down cycles. Some days you’re smart and some days you’re dumb. When you’re wrong, don’t let that freeze you. Keep going and continue to make what you think are the right decisions, even if they are tough decisions.”

Billy Beane, Oakland A’s


A proposal for reducing communal violence in India: Promote gerrymandering

Wanted to tweet this but figured a short blog post makes my point (violent vs. non-violent political strategies can be substitutes) better.

Premise 1: Politicians like to win elections.

Premise 2: The rationality of political choices are separate from their morality. E.g. Riots, i.e., systematic violence against communities, are an effective strategy for electoral success. This unfortunately means that immoral strategies that work (in this case riots), will always be popular amongst politicians.

Premise 3: Less violent strategies for electoral success are available.

Conclusion: Promoting political/legal substitutes to riots, such as gerrymandering should reduce communal violence.

Jared Diamond on silo-busting in academia…

Silo-busting is exceptional in academia – one is expected to specialise. There is a lot of turf warfare,” he notes, explaining that when he first started studying ornithology he kept this secret from his colleagues in the medical department. “Luckily my [academic] papers about birds were published in journals which no gall bladder physiologists ever read. But when my review committee eventually found out about what I was doing, they voted against my promotion. In academia, working in multiple fields is not a benefit but a penalty.” So much so that he now advises young academics to “make sure you get tenure before you start publishing in a second field”. “In academia people talk about interdisciplinary thinking and run courses and programmes – but Lord help you if you try to make an interdisciplinary career, unless you are already so high that there is nothing they can do to you.”

“The society wh…

“The society which scorns excellence in plumbing because plumbing is a humble activity, and tolerates shoddiness in philosophy because philosophy is an exalted activity, will have neither good plumbing nor good philosophy. Neither its pipes nor its theories will hold water.”

-John William Gardner

The Genesis of a Fox

‘The fox knows many things, but the hedgehog knows one big thing’ – Greek poet Archilochus

This ancient distinction used by Issiah Berlin in his essay The Hedgehog and the Fox: An Essay on Tolstoy’s View of History was extended to two cognitive styles by Philip Tetlock in his book Expert Political Judgment: How Good Is It? How Can We Know?.

The gist of the argument is that Foxes have an eclectic toolbox, one they apply without any concern for pet theories/concepts (they don’t have any) and as such can better adapt themselves to changing circumstances. Hedgehogs on the other hand, have a single big idea/theory/concept that they try to fit the empirical world into. They have a cognitive need for closure that is satisfied by bludgeoning reality into their favorite model/worldview.

Tetlock, in his book, goes on to empirically demonstrate how foxes have been better forecasters than hedgehogs in the arena of political science. Not surprisingly this distinction between foxes and hedgehogs makes intuitive sense and similar forecasting results (i.e., foxes perform better) are likely in fields which are high in complexity and uncertainty. The dynamic nature of such fields (including business, economics, technology etc.) makes “experts” with one big idea vulnerable to getting blindsided by unexpected big events, i.e. The Black Swan.

A recent post by Nassim Taleb highlighted the way people’s identities are wrapped up in their work and accomplishments. Nassim argues that this is not only different from the past (ancients) but also varies across the economic spectrum with only the minimum wage earners being able to separate their identities from the mode of earning a living. This undoubtedly ties into his earlier point about never taking advice from people wearing a tie. Those whose identities are close to their (knowledge) work tend to overlook the fallibility in their fields. A mind focused on falsification and professional pride are rarely seen in the same person. So how can one (especially if you are a ‘knowledge worker’) avoid this problem? I think Paul Graham had the best advice (closely tied to but broader than Nassim’s comment) : “The more labels you have for yourself, the dumber they make you." Keep your identity small.