Unexpected stuff happens. That's the idea. The actual book is unexpected stuff happens> brag> example of unexpected stuff happening> humblebrag> you know, unexpected stuff happens> repeated far, far, far too many times. Unless you want an example of self satisfied old white men showing, as only they can, how to eek a thin idea out over a huge number of pages, give it a miss. 1324004770 For a hyper discursive one idea book, this was actually rather good!Here’s the idea:Economics would do well to turn its mathematical prowess away from the idea that economic agents are busy maximising something and must focus on “what’s going on here.”And “what’s going on” is quite simple: we all have some sort of dream! (the word the authors use is “narrative.”) As we gather information, we assess how this new information influences our dream and adapt accordingly.The End.This is neither Mervyn King’s nor John Kay’s best book, but that’s a mighty high bar. John Kay is one of my Gods (for all his contributions to the FT) and author of three excellent books, including “The Truth About Markets” (though I’d give a miss to the rather grumpy “Other People’s Money.”) Mervyn King is the author of “The End of Alchemy,” a truly AMAZING, one lesson per paragraph treatise about the 2008 crisis and what central banks ought to do to avoid the next one.Speaking of which, they’re totally on the ball: top of page 40 they as good as predict the current coronavirus crisis. And in pages 408 409 they introduce the concept that “the large corporation is the most important actor in the modern economy, and it is surprising how little attention has been given to the economics of organisation.”So there you have it: to get out of our bind, to understand the economy and to be able to make decent predictions about the future, we need to study the narrative that’s in the head of the captains of industry and predict how they will react to new information, be that incremental or some type of shock. That’s the main takeaway here.But that’s to sell the book short. It’s full of amazing stories, references millions of recent books without ever being overbearing and makes fun of David Viniar on pages 6, 9, 58, 68, 109, 150, 176, 202, 235 and 366.It’s kept me good company for a week and I recommend it to anybody looking for what strongly feels like the last book from two very good authors. 1324004770 This book is a useful antidote to theories of judgement and decision making generated in lab studies that assume human behaviours which depart from prescriptions of 'rational behaviour' in small worlds of probabilitic risk represent major failures of huamn reasoning. Unfortunately these theories are all too influential in economics, in government decision models which aim to identify optimal choices and in many cases in business.The authors draw on deep experience and a wide range of research to show how the ways in which we make decisions in contexts of deep uncertainty need profound rethinking.Whilst as some reviewers have noted there is a degree of repetition of ideas in the book, this is useful in communicating not only the theoretical but practical importance of these ideas. 1324004770 I wish I could give this stars, because its premise is spot on and the authors' expertise, intellect and engaging writing style should equip them to deliver a clear and powerful message.But they don't. The first third or so is devoted to an extended review of probability theory; I suspect the probability is that most readers will already be quite familiar with the various coin tossing, card playing, second guessing, greed vs loss aversion type of topics which have been repeated in so much of the literature. And, really, the Cuban missile crisis AGAIN??! Please don't. It all felt like padding to help make an impressively heavy tome on the bookshop shelf.You will already know the book's central tenets from the blurb and the other reviews. You can't build a model around the behaviour of a fishpond and expect to get useful insights into that of an ocean. Extrapolation is dangerous when the world is changing. But if you already appreciate that and are hoping that the book will live up to its cover and provide you with some insightful, or creative alternative ways to think about the future.well, there aren't any. It's an exposition of shortcomings, not a recipe book for new thinking. 1324004770 I read the book with interest. I am an ex decision analyst and now scenario thinker.The critique of SEU theory is fair. Their development of an alternative approach to making decisions the face of uncertainty about the future is less well specified. A lot of material is included on the way people reason by narratives, the use of small groups to exchange opinions, and the use of Taleb's positioning approach of clipping downside risks and being open to upside risks. There is some mention of scenario thinking and trying to make robust and resilient decisions in the face of uncertainty but this discussion is not well developed as a practical proposition. I think the authors need to find out about scenario methods beyond those of Schoemaker. There is a lot of recent stuff about combining decision analysis ( SMART) with scenarios and a lot about developing causality in scenario storylines, etc. The new Wiley journal 'Futures & Foresight Science' is a good way into this developing area. 1324004770
$12.10 shipping Radical Uncertainty: Decision-Making Beyond the Numbers : Kay, John, King, Mervyn
