Topic: fragility

Nicole Rust examines why advances in neuroscience have not translated straightforwardly into treatments for brain and mental disorders. Drawing on Elusive Cures, she considers the relationship between memory and mood, robustness and fragility, modelling, standardisation and iterative changes in how researchers frame the problems they study.

Nassim Nicholas Taleb develops two approaches to reasoning about extreme risk. In the first part, on the law of large numbers in the real world, he defines fat-tailed distributions and examines why conventional statistical procedures can perform poorly for economic variables. He stresses the much larger data requirements and the choice of estimators when rare observations dominate outcomes. The second part considers how to detect fragility in portfolios. Taleb describes fragility as sensitivity to volatility and argues for analysing the shape of an exposure and its response to shocks when rel