What Is Anti-Fragility?
Anti-fragility describes a category of things that not only gain from chaos but need it to survive and flourish. The concept was developed by Nassim Nicholas Taleb, a professor, and former trader and hedge fund manager. Taleb, who claims to have predicted the great recession, coined the term “anti-fragility" because he thought the existing words used to describe the opposite of "fragility," such as "robustness," were inaccurate.
- Anti-fragility goes beyond robustness; it means that something does not merely withstand a shock but actually improves because of it.
- The concept was developed by professor, former trader, and hedge fund manager Nassim Nicholas Taleb.
- Taleb believes we must learn how to make our public and private lives anti-fragile, rather than simply less vulnerable to randomness and chaos.
- Examples include not getting into debt and avoiding optimization.
Anti-fragility goes beyond robustness; it means that something does not merely withstand a shock but actually improves because of it. In his 2012 book, Antifragile: Things That Gain from Disorder, Taleb offered the following definition: "Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder, and stressors and love adventure, risk and uncertainty. Yet, in spite of the ubiquity of the phenomenon, there is no word for the exact opposite of fragile. Let us call it anti-fragile. Anti-fragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the anti-fragile gets better."
The book's central theme purports that we must learn how to make our public and private lives (our political systems, social policies, finances, etc.) anti-fragile, rather than simply less vulnerable to randomness and chaos. By positioning for nonlinear events, we can benefit or take advantage of stress, errors, and change, which are all but certain anyway.
In Mr. Taleb’s view, “We have been fragilizing the economy, our health, political life, education, almost everything” by “suppressing randomness and volatility,” much the way that “systematically preventing forest fires from taking place ‘to be safe’ makes the big one much worse.”
The concept of anti-fragility can be applied to a variety of fields, including physics, molecular biology, transportation planning, engineering, mega project management, computer science, and risk analysis—Taleb's specialty.
Taleb offers several examples of how the world and its population can become less fragile. They include relying less on gyms and doctors, both of which he argues make us ill, eating less, and toughening our children up.
One example that crops up regularly in the book is the importance of not getting into debt: "When you don't have debt you don't care about your reputation … and somehow it's only when you don't care about your reputation that you tend to have a good one,” he wrote.
For Taleb, a prerequisite of political anti-fragility is zero debt. He argued that governments should adopt rigid fiscal conservatism as debts make them fragile. Taleb also called for an increase in redundancies “in some spaces”, and avoidance of optimization, even if it runs counter to everything that portfolio theory teaches.
“I have always been very skeptical of any form of optimization," he said. "In the black swan world, optimization isn’t possible. The best you can achieve is a reduction in fragility and greater robustness.” Taleb describes an anti-fragile trading strategy as one that does not merely withstand a turbulent market but becomes more appealing under such conditions.
Taleb’s anti-fragility theory can be linked to his earlier work. In his 2007 book, The Black Swan: The Impact of the Highly Improbable, he discussed unpredictable events that impact businesses.
He urged readers to brace themselves for so-called black swan events, rather than try and predict when they may happen. That requires businesses to be more conservative in what goals they chase and keep their balance sheets strong, among other things.