(2007-10-17) Taleb Predicting Innovation

Nassim Taleb says It's impossible to predict who will Change The World (Innovation), because major changes are Black Swan-s, the result of accidents and Luck. But we do know who society's winners will be: those who are prepared to face Black Swans, to be exposed to them, to recognize them when they show up and to rigorously exploit them... It is high time to recognize that we humans are far better at doing than understanding, and better at tinkering than inventing. But we don't know it. We truly live under the illusion of order, believing that planning and forecasting are possible. We are scared of the random, yet we live from its fruits. We are so scared of the random that we create disciplines that try to make sense of the past--but we ultimately fail to understand it, just as we fail to see the future. The current discourse in economics, for example, is antiquated. American undirected Free Enterprise works because it aggressively allows us to capture the randomness of the environment--the cheap Black Swans. This works not just because of competition, and even less because of material incentives. Neither the followers of Adam Smith nor those of Karl Marx seem to be conscious of the prevalence and effect of wild randomness. They are too bathed in Enlightenment-style Cause And Effect, and cannot accept that skills and payoffs may have nothing to do with one another.