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Mind Macros 59: The Lindy effect, predicting the future, and a fulfilling life
"That which is 'Lindy' is what ages in reverse, i.e., its life expectancy lengthens with time, conditional on survival." — Nassim Nicholas Taleb
Welcome to another issue of Mind Macros - I hope you find something of value.
Food for Thought
I. The Lindy effect: Predicting the future
"That which is ‘Lindy’ is what ages in reverse, i.e., its life expectancy lengthens with time, conditional on survival." — From Skin in the Game by Nassim Nicholas Taleb.
"Time to get more technical, so a distinction is helpful at this stage. Let us separate the perishable (humans, single items) from the nonperishable, the potentially perennial. The nonperishable is anything that does not have an organic unavoidable expiration date. The perishable is typically an object, the nonperishable has an informational nature to it. A single car is perishable, but the automobile as a technology has survived about a century (and we will speculate should survive another one). Humans die, but their genes—a code—do not necessarily. The physical book is perishable—say, a specific copy of the Old Testament—but its contents are not, as they can be expressed into another physical book.
"Let me express my idea in Lebanese dialect first. When you see a young and an old human, you can be confident that the younger will survive the elder. With something nonperishable, say a technology, that is not the case. We have two possibilities: either both are expected to have the same additional life expectancy (the case in which the probability distribution is called exponential), or the old is expected to have a longer expectancy than the young, in proportion to their relative age. In that situation, if the old is eighty and the young is ten, the elder is expected to live eight times as long as the younger one.
"For the perishable, every additional day in its life translates into ashorteradditional life expectancy. For the nonperishable, every additional day may imply alongerlife expectancy.
"So the longer a technology lives, the longer it can be expected to live. Let me illustrate the point (people have difficulty understanding it at the first go). Say I have for sole information about a gentleman that he is 40 years old and I want to predict how long he will live. I can look at actuarial tables and find his age-adjusted life expectancy as used by insurance companies. The table will predict that he has an extra 44 to go. Next year, when he turns 41 (or, equivalently, if applying the reasoning today to another person currently 41), he will have a little more than 43 years to go. So every year that elapses reduces his life expectancy by about a year (actually, a little less than a year, so if his life expectancy at birth is 80, his life expectancy at 80 will not be zero, but another decade or so).
"The opposite applies to nonperishable items. I am simplifying numbers here for clarity. If a book has been in print for forty years, I can expect it to be in print for another forty years. But, and that is the main difference, if it survives another decade, then it will be expected to be in print another fifty years. This, simply, as a rule, tells you why things that have been around for a long time are not “aging” like persons, but “aging” in reverse. Every year that passes without extinction doubles the additional life expectancy. This is an indicator of some robustness. The robustness of an item is proportional to its life!” — From Antifragile by Nassim Nicholas Taleb.
The Lindy effect states that the longer a nonperishable item has existed, the longer it's likely to exist. Every additional day it survives increases its life expectancy. If a book has remained in print for 2000 years, we can expect it to stay that way for another 2000 years. Among books, we can include movies, music, fashion trends, technology, consumer products, ideas and concepts, art and architecture, business models, and political systems.
II. Applying the Lindy effect
The Lindy effect provides practical guidance when making decisions. Scrutinizing the historical track record of something is an effective way of predicting its future.
As an investor, we might seek out companies that have withstood the tests of time. When shopping for a new car, we could research reliable brands which have a longstanding history of safety and dependability. When traveling, the Lindy effect could provide guidance on which countries and cities to visit. Those with a history of accommodating tourists will likely be safer and more rewarding vacation spots.
Using the Lindy effect to guide our decisions means relying on established norms rather than unproven trends. We trade reliability, longevity, and stability for potentially promising products, innovative changes, and novelty.
Taleb demonstrates how he uses the Lindy effect to filter his reading list:
"So, we can apply criteria of fragility and robustness to the handling of information—the fragile in that context is, like technology, what does not stand the test of time. The best filtering heuristic, therefore, consists in taking into account the age of books and scientific papers. Books that are one year old are usually not worth reading (a very low probability of having the qualities for 'surviving'), no matter the hype and how 'earth-shattering' they may seem to be. So I follow the Lindy effect as a guide in selecting what to read: books that have been around for ten years will be around for ten more; books that have been around for two millennia should be around for quite a bit of time, and so forth. Many understand this point but do not apply it to academic work, which is, in much of its modern practice, hardly different from journalism (except for the occasional original production). Academic work, because of its attention-seeking orientation, can be easily subjected to Lindy effects: think of the hundreds of thousands of papers that are just noise, in spite of how hyped they were at the time of publication."
"I complete this section with the following anecdote. One of my students (who was majoring in, of all subjects, economics) asked me for a rule on what to read. 'As little as feasible from the last twenty years, except history books that are not about the last fifty years,' I blurted out, with irritation as I hate such questions as 'what’s the best book you’ve ever read,' or 'what are the ten best books,'—my 'ten best books ever' change at the end of every summer. Also, I have been hyping Daniel Kahneman’s recent book, because it is largely an exposition of his research of thirty-five and forty years ago, with filtering and modernization. My recommendation seemed impractical, but, after a while, the student developed a culture in original texts such as Adam Smith, Karl Marx, and Hayek, texts he believes he will cite at the age of eighty. He told me that after his detoxification, he realized that all his peers do is read timely material that becomes instantly obsolete." — From Antifragile by Nassim Nicholas Taleb.
If Taleb's recommendation is too strict, an alternative is the Barbell approach, which finds a balance between reading older, more established works and newer, trending titles. With this strategy, we might allocate 80% of our time to books that were released prior to a set threshold, say, the year 2000. The remaining 20% can then be devoted to newer works. In this way, we not only gain valuable knowledge from well-respected titles but can keep up with the changing tides of opinions and ideas.
Quotes to Ponder
I. Robert Fulghum on questioning our thoughts:
"Don't believe everything you think."
II. Ralph Waldo Emerson on a fulfilling life:
"This is my wish for you: Comfort on difficult days, smiles when sadness intrudes, rainbows to follow the clouds, laughter to kiss your lips, sunsets to warm your heart, hugs when spirits sag, beauty for your eyes to see, friendships to brighten your being, faith so that you can believe, confidence for when you doubt, courage to know yourself, patience to accept the truth, Love to complete your life."
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