Radical Uncertainty: Decision-making for an unknowable future by John Kay

Radical Uncertainty: Decision-making for an unknowable future Reviews

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  jassim abdulla almannai

  It is a great work done by great economists
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  Ross

  Lots of filler material it reads as though the authors were trying to achieve a certain minimum page count. Some good ideas, but no than could be expressed in a short pamphlet. I don’t think this book adds much beyond the work of Nassim Taleb, which is eminently readable and insightful.
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  Vedran

  This book from an ex governor of the Bank of England and an Oxford professor is not what I expected it to be. Still, it was quite fun to read.The prose is very light and well written. Some economist humor scattered throughout the book definitely helps readability. But when it comes to books about risk and uncertainty, this book is nowhere close to Nicholas Talebs books in terms of either charm, scope, or depth. It also, consequently, produces much less self reflection and thinking on your side.The book is split in six parts, discussing the nature of uncertainty, the lure of probabilities, making sense of uncertainty, economics and uncertainty and living with uncertainty.The first part covers the history of probability and statistics, mainly focusing on why these developments came so late in the history of mathematics, even though they are comparatively simple subjects. The second one shows how these mathematical constructs became part of mainstream modeling in economics, business, and other aspects of life. Both of these topics are interesting, but they are covered at a very superficial level so that if you have any familiarity with the topic you will find the first two parts quite unnecessary.The third part reminds us that theres inductive, deductive, and abductive reasoning, and that the last one, the reasoning which seeks to provide the best explanation of a unique event, is used very often in practice. From this it goes on to discuss biases alla Daniel Kahnemans Thinking Fast and Slow. While taking a positive view on Kahneman and Tversky, it argues against most of behavioral economics on the grounds that their rational behavior is not really rational.There are points made about the fact that real people and companies do not really optimize but rather cope. Further, there are arguments made about how narratives are often much useful than quantitative modeling.Throughout, shallow links are made to various branches of science: physics, evolutionary theory, anthropology, psychology, etc. Since these links are generally superficial and not thought true in detail, they seem to be included to prove the point that our authors are very learned and intelligent, than to actually contribute much to the discussion.Part four deals with regulations, macroeconomic models, and general failure of models and model driven thinking in these applications of economic theories. Finally, in the last part the book reiterates some of the main points.This brings us to the overall score. The book is often repetitive. By keeping discussions shallow and simple, it is at the same time easy (and fun) to read, but it is also slightly annoying. You will often feel the urge to skim through parts of it.You could argue reiteration is a teaching style meant to reinforce the point and make you remember key messages but Id counter that most of the book is actually quite forgettable. Comparing it to Taleb once , I think the reason for this is mostly because it is watered down, less charming, and less penetrating.What they share is similar topics of discussion, courage to critique and call out influential people, and ability to connect seemingly disparate areas of knowledge into one consistent prose.To conclude, I would recommend it to almost everyone even if you read Taleb.
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  Demetrius Cunningham Jones III

  The authors, John Kay and Mervyn King, define radical uncertainty as the quality pertaining to those questions for which there is nomeans of resolving uncertainty we simply do not know. While they appear to believe that for at least some of these questions we may have answers sometimes in the future (for example, in forecasting the weather several months in advance of the present), there are others that will be forever out of our ken. However, they do not ever quite address the latter because their focus in this book is on the hubris of their colleagues who create macro economic models of human behavior. Those models, widely used in the making of economic policy and the normative construction of social theory, implicitly rest on claims to knowledge that, the authors maintain, is clearly unwarranted and professionally irresponsible. In many respects, this book can be paired with Nassim Talebs The Black Swan, a highly readable but ultimately inferior analysis of the same problem. That said, Radical Uncertainty could have been much shorter and still have made its argument.
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  Ian S. Moss

  The point to be made, radical uncertainty is made pedanticaly. The resolution so far are stories, some would call them scenarios, an old theme. The attack is on subjective probabilities. I understand and agree, but one cannot help but think that just maybe, there is something there. To sleep, perchance to dream. That is the rub. I think the problem is that seemingly rational man and woman, have appeal, until exactly what that it is, sows dought. These authors have at least left us in that quandary. Rational, yes, but without all the pieces. Humanity struggles to find a logical way, the path is not clear, economics offers one perspective, and an important one, but like most if not all of them perspectives that is it is not the whole story.