Wednesday, December 31, 2014

Failure is Not an Option, It's a Must

"What's important isn't education; it's apprenticeship. Germany has a huge advantage over the rest of the world as it has a high rate of apprenticeship in its economy. Switzerland used to be the least educated in Europe. Now it's the second most educated; that's why it's going down."

To encourage "swashbucklers" and entrepreneurs, people have to be taught to take intelligent risks - something that universities don't teach. "Universities teach you not to take risks. Because if you make mistakes, you flunk the exam. But in life there is no such thing as a track record of exams. You start from zero. So you have to teach people to fail and take risks."

He sees technology as the most antifragile industry; it has the highest failure rate. "Remarkably the lowest failure rate is in - guess which one - banking. They don't fail."

He invokes once again the evolutionary mechanism. "Everytime you procreate you reproduce yourself. Our DNA has replication error... You have to have some fidelity in replication; you have some error but not too much. Too much and you won't retain the advantages. The same mechanism makes businesses work well."


"I'm not a professor of economics. I'm a professor of engineering. This is critical. There is no nonsense in engineering. The tolerance for nonsense in economics is monstrously high. In engineering, it's close to zero. If a bridge collapses, economists would spin a story. In engineering, you build another one."

He has a library in Lebanon, where he was born and raised, and another in the US. He spends 300 days a year in his libraries. "Everyday I go to the university and come back. It's more of a social day than a research day. I'm not against scholarship. I'm against institutionalised scholarship. There are two forms of skills in society. One is codified in the university, which is the stupid form. One is embedded in society, which is the smart form.

"People don't realise that in England, intellectual production dropped enormously when they relied on universities. Amateurs introduced science. Darwin was an amateur scientist. The amateur doesn't cheat; he's not in it for the title... Which is why I try to avoid the university. In my library I don't play games. I follow my sense of what makes me feel good in the evening.

- Interview with Nassim Taleb

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