Extra Questions for Taleb
By Bryan Caplan
The time just flew by during my conversation with Nassim Taleb. Here are a few questions I didn’t get to ask him:
1. Do you think the traditional academic curriculum is even worse than I say, because it creates a national intellectual monoculture, prone to experiencing negative Black Swans and missing positive Black Swans?
2. You write: “There is an ample academic literature trying to convince us that options are not rational to own because some options are overpriced, and they are deemed overpriced according to business school methods of computing risks that do not take into account the possibility of rare events.” This isn’t quite what I do when I compute education’s selfish and social returns, but would you apply the same critique to my estimates?
3. I’ve won both my public bets with Tyler. But he thinks that if I really knew what I was talking about, I’d already be a fabulously rich investor. I reply that, unfortunately, most of my superior insight is barely relevant to any available investment opportunity. I was thinking about this Caplan-Cowen dispute when you wrote, “Indeed many people lost their shirt from the drop of oil – while correctly predicting war. They just thought it was the same thing.” Care to comment?
4. It seems to me that every bite of food I eat is fragile in your sense. After all, any bite could be lethally poisonous, and if that possibility
ever materializes, I die. My inclination is to say, “Who cares about fragility, when the probability of poison is so low?” Is my complacency wrong – and if so, why?