Equilibrium, Not Again
Taleb contrasts economic equilibrium with the physical equilibrium of an inactive system. Living organisms maintain their organization through ongoing exchanges of energy and matter. He uses this contrast to argue that suppressing all variation can harm complex systems.
THE IDEA
Social scientists use the term “equilibrium” to describe balance between opposing forces, say, supply and demand, so small disturbances or deviations in one direction, like those of a pendulum, would be countered with an adjustment in the opposite direction that would bring things back to stability. In short, this is thought to be the goal for an economy.
Looking deeper into what these social scientists want us to get into, such a goal can be death. For the complexity theorist Stuart Kaufman uses the idea of equilibrium to separate the two different worlds of Table 2. For the nonorganic, noncomplex, say, an object on the table, equilibrium (as traditionally defined) happens in a state of inertia. So for something organic, equilibrium (in that sense) only happens with death. Consider an example used by Kaufman: in your bathtub, a vortex starts forming and will keep going after that. Such type of situation is permanently “far from equilibrium”—and it looks like organisms and dynamic systems exist in such a state.2 For them, a state of normalcy requires a certain degree of volatility, randomness, the continuous swapping of information, and stress, which explains the harm they may be subjected to when deprived of volatility.
When to use it
Examining the role of a particular disturbance, such as fire or flooding, in a specific ecosystem.
Evaluating whether an organization’s pursuit of stability also prevents useful experiments and feedback.
Choosing manageable challenges while allowing enough recovery to learn and adapt.
FROM THEORY TO EVERYDAY LIFE
In practice
Bathtub Vortex
A vortex sustained by flowing water is 'far from equilibrium' and continues dynamically, similar to living organisms. It does not settle into a stable, static state but maintains structure through ongoing flow.
Pendulum vs. Organism
A damped pendulum settles at rest after a disturbance. An organism, by contrast, maintains itself through ongoing activity and exchanges with its surroundings. Economic equilibrium describes a different kind of balance and should not be equated with physical inactivity.
A MOMENT TO REFLECT
Put it to work.
How does this redefinition of equilibrium challenge conventional ideas about stability in economics or society?
In what areas of your life do you observe that a lack of volatility leads to stagnation or harm?
Can you think of a system (biological, organizational, or personal) that thrives on being 'far from equilibrium'?
CONTINUE THE CONVERSATION
Source texts
- Antifragile (Nassim Nicholas Taleb)