I recently finished reading Nassim Nicholas Taleb’s fifth book: Skin in the Game. The book followed international best sellers such as Antifragile, The Black Swan and Fooled by Randomness which made Taleb one of the most popular authors in topics such as modern philosophy and economics. Skin in the Game does not disappoints and becomes a natural complement to the previous titles but, this time, Taleb deviates from pop-philosophical concepts to focus on as simple idea appealing to any human being: if you have no skin in the game, you shouldn’t be in the game. “If you give an opinion, and someone follows it, you are morally obligated to be, yourself, exposed to its consequences.”
Throughout the book, Taleb presents a series of examples how the outcome of events is radically different when the participants have “skin in the game”. As Taleb says “Hawks in the White House should not be taking decisions about bombs in Iraq when they will remain in their air-conditioned houses with their 2.2 children whatever the result”. Other professions such as doctors intrinsically doctors have skin in the game, having professional pride and reputation, severe legal consequences for error.
Skin in the game ensures that people learn from their mistakes and evolve their thinking. Taleb goes as far as invoking the ancient Babylonian code of Hamurabi that includes 282 laws, with scaled punishments and links actors to consequences of their action.
In my opinion, the most important takeaway from Taleb’s book is that skin in the game is not only an principle in life but a central pillar of organic functioning systems and even evolution itself. As Taleb said in a recent blog post: “Systems don’t learn because people learn individually –that’s the myth of modernity. Systems learn at the collective level by the mechanism of selection: by eliminating those elements that reduce the fitness of the whole, provided these have skin in the game”