When Joanne Rowling sat in an Edinburgh coffee shop, nearly broke, her baby sleeping nearby in a stroller, penning a fantastic story about a school for wizards, could anyone have predicted that she would soon be the most successful novelist in history?
Certainly not the twelve publishers who rejected her manuscript before Bloomsbury finally offered her a trifling £1,500 advance for a work that would ultimately become the basis for a billion-dollar publishing empire.
Probability expert Nassim Nicholas Taleb believes that our inability to predict blockbuster successes like Harry Potter is mirrored by an equivalent deficiency in predicting catastrophic disasters like World War I. Yesterday he participated in a fascinating interview on NPR where he discussed his theory and its potential applications.
Taleb argues that history books make up reasons for events that are by their very nature improbable. If someone had sat in a coffee house in Vienna in 1913 and related the history-book explanation of the situation in at that time, explaining that Europe was on the brink of an unprecedented continent-wide war, Taleb claims, he would have been carted off as a lunatic.
Despite the inherent unpredictability of events like this, Taleb argues that there are ways to manage that uncertainty to our advantage, but it requires an understanding of basic psychology. “We’re suckers for a narrative,” he says. When a story is attached to an event, it seems more probable than it actually is, causing us to err on the conservative side for negative events, and on the risky side for positive ones.
He also mentions the propensity to risk more to avoid losses than to make gains. This can explain why publishers are so quick to reject even promising works by unproven writers. Taleb suggests that publishers should be offering more contracts to writers because that small risk can have such a vast reward.
Overall, a fascinating interview, and I highly recommend listening to the whole thing. (Beware, however — it crashed Firefox the first time I tried to listen.)