Nassim Nicholas Taleb's book, Skin in the Game: Hidden Asymmetries in Daily Life uses the wisdom of Hammurabi's code and Roman Law to analyze problems with people profiting while transferring the risk of loss to others.
His advice, trust no one who offers advice but is not exposed to the negative consequence. People who build bridges or repair helicopters need to sleep under the bridge or fly in the helicopters. Rulers of countries used to fight in battle and put their life on the line. This affected their calculation about going to war.
He advocates the silver rule: Do not do onto others what you would not want them to do to you. Beware of the advice of people who are reviewed by their peers and not by their customers. Restaurants survive and die based on their ability to satisfy their customers. Pundits and writers play to their peers and are insulated from the negative side effects of their advice.
He also points to the Lindy Effect. If something has survived a long time it is likely that it will continue to last. By this reasoning advice on longevity from a person who has lived more than a hundred years will carry more weight than the advice from a controlled study that does not take into account the multiple variables of real life. He points to the large number of peer reviewed studies showing a significant effect that were later found to be erroneous when tested years later.
The Lindy Effect should not be confused with the Thanksgiving Turkey Effect. Do not assume that current conditions will continue indefinitely. A turkey before Thanksgiving thinks the farmer is a great person. Circumstances change and the turkey is no longer around to modify the assessment of the farmer.
His discussion about the power of a minority view to disproportionately effect the behaviors of others in society is interesting and thought provoking. The rare condition of severe peanut allergy has caused schools and air lines to modify their access to peanuts and peanut butter.
This book is his current capstone to Black Swan, Fooled by Randomness, and Antifragile. He frequently refers to these books in the text and having a familiarity with these text will help in understanding his points.
Animated book review of Skin in the Game - 3 min.
Skin in the Game explained - 3 min.
Ron Paul interviews Nassim Taleb about Skin in the Game - 32 min.
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