Tail Risks

From The Economist, an argument that things are getting better from at least one perspective—the number of desperately poor has been halved since 1990; the effect is predominantly due to China’s huge growth. This welcome fact made me think of the argument circulating recently that the human propensity to violence and war had dramatically decreased in recent times and (apparently) can be expected to decrease further time goes on.

I do wonder, in both cases, whether we’re just moving around the risks to a certain extent. In the violence and war category, it’s clear that while war and great power war has decreased, that any potential outbreak of war might have catastrophic consequences—i.e. nuclear weapons exploding, to say nothing of chemical or biological warfare. While there may be some element of mutually assured destruction involved in preventing war, it does mean that whenever the statistically improbable event of war happens it could be awful.

The lessening of poverty is similarly welcome but the ecological consequences of many more people commanding more resources are awfully worrisome—besides global warming you also have to think about risks like rapidly depleting freshwater or oil (both of which can be finessed to a certain degree but involve permanent unpleasant costs). It’s also very possible that the interaction of such pressures might combine into something worse and unforeseen. So I’m worried we’re neglecting the tail risks.