Skin in the Book

Today on Luke Ford we'll be talking about Nicholas Nassim Taleb's book Skin in the Game, the Hidden Asymmetries in Daily Life.

It's the fourth book in the former trader and risk analyst's Incerto series on risk, randomness and responsibility. The first book, Fooled by Randomness purports to demonstrate we are, just as the title says, fooled into creating "rational" explanations for random occurrences, including catastrophic market failures, or "black swan" events, the misunderstanding of which as he sees it he addresses in The Black Swan.

In the third book Antifragile he offers the concept of antifragility as a measure of a market or society's robustness or durability, demonstrated by how it responds to shocks, for one thing. Something is antifragile if, a la Nietzche, that which doesn't kill it makes it stronger.

Skin in the Game is about bearing the consequences of one's actions--above all of one's responsibilities: "...skin in the game is mostly about justice, honor, and sacrifice, things that are existential for humans"; "those who don't take risks should never be involved in making decisions."