more and more attention as their names become associated more
tightly with the subject at hand. The difference between the winning three
and the other members of the original cohort is mostly luck: they were initially
chosen not for their greater skill, but simply for the way their names
appeared in the prior bibliography. Thanks to their reputations, these successful
academics will go on writing papers and their work will be easily
accepted for publication. Academic success is partly (but significantly) a
lottery.*
It is easy to test the effect of reputation. One way would be to find papers
that were written by famous scientists, had their authors' identities
changed by mistake, and got rejected. You could verify how many of these
rejections were subsequently overturned after the true identities of the authors
were established. Note that scholars are judged mostly on how many
times their work is referenced in other people's work, and thus cliques of
people who quote one another are formed (it's an "I quote you, you quote
me" type of business).
Eventually, authors who are not often cited will drop out of the game
by, say, going to work for the government (if they are of a gentle nature),
or for the Mafia, or for a Wall Street firm (if they have a high level of hormones).
Those who got a good push in the beginning of their scholarly careers
will keep getting persistent cumulative advantages throughout life. It
is easier for the rich to get richer, for the famous to become more famous.
In sociology, Matthew effects bear the less literary name "cumulative
* Much of the perception of the importance of precocity in the career of researchers
can be owed to the misunderstanding of the perverse role of this effect, especially
when reinforced by bias. Enough counterexamples, even in fields like mathematics
meant to be purely a "young man's game," illustrate the age fallacy: simply, it is
necessary to be successful early, and even very early at that.
2 1 8 THOSE GRAY SWANS OF EXTREMISTAN
advantage." This theory can easily apply to companies, businessmen, actors,
writers, and anyone else who benefits from past success. If you get
published in The New Yorker because the color of your letterhead attracted
the attention of the editor, who was daydreaming of daisies, the
resultant reward can follow you for life. More significantly, it will follow
others for life. Failure is also cumulative; losers are likely to also
lose in the future, even if we don't take into account the mechanism of
demoralization that might exacerbate it and cause additional failure.
Note that art, because of its dependence on word of mouth, is extremely
prone to these cumulative-advantage effects. I mentioned clustering
in Chapter 1, and how journalism helps perpetuate these clusters. Our
opinions about artistic merit are the result of arbitrary contagion even
more than our political ideas are. One person writes a book review; another
person reads it and writes a commentary that uses the same arguments.
Soon you have several hundred reviews that actually sum up in
their contents to no more than two or three because there is so much overlap.
For an anecdotal example read Fire the Bastards!, whose author, Jack
Green, goes systematically through the reviews of William Gaddis's novel
The Recognitions. Green shows clearly how book reviewers anchor on
other reviews and reveals powerful mutual influence, even in their wording.
This phenomenon is reminiscent of the herding of financial analysts I
discussed in Chapter 10.
The advent of the modern media has accelerated these cumulative advantages.
The sociologist Pierre Bourdieu noted a link between the increased
concentration of success and the globalization of culture and
economic life. But I am not trying to play sociologist here, only show that
unpredictable elements can play a role in social outcomes.
Merton's cumulative-advantage idea has a more general precursor,
"preferential attachment," which, reversing the chronology (though not
the logic), I will present next. Merton was interested in the social aspect of
knowledge, not in the dynamics of social randomness, so his studies were
derived separately from research on the dynamics of randomness in more
mathematical sciences.
Lingua Franca
The theory of preferential attachment is ubiquitous in its applications: it
can explain why city size is from Extremistan, why vocabulary is concenFROM
MEDIOCRISTAN TO E X T R E M I S T A N , AND BACK 2 1 9
trated among a small number of words, or why bacteria populations can
vary hugely in size.
The scientists J . C. Willis and G. U. Yule published a landmark paper
in Nature in 1922 called "Some Statistics of Evolution and Geographical
Distribution in Plants and Animals, and Their Significance." Willis and
Yule noted the presence in biology of the so-called power laws, atractable
versions of the scalable randomness that I discussed in Chapter 3. These
power laws (on which more technical information in the following chapters)
had been noticed earlier by Vilfredo Pareto, who found that they applied
to the distribution of income. Later, Yule presented a simple model
showing how power laws can be generated. His point was as follows: Let's
say species split in two at some constant rate, so that new species arise.
The richer in species a genus is, the richer it will tend to get, with the same
logic as the Mathew effect. Note the following caveat: in Yule's model the
species never die out.
During the 1940s, a Harvard linguist, George Zipf, examined the
properties of language and came up with an empirical regularity now
known as Zipf's law, which, of course, is not a law (and if it were, it would
not be Zipf's). It is just another way to think about the process of inequality.
The mechanisms he described were as follows: the more you use a
word, the less effortful you will find it to use that word again, so you borrow
words from your private dictionary in proportion to their past use.
This explains why out of the sixty thousand main words in English, only
a few hundred constitute the bulk of what is used in writings, and even
fewer appear regularly in conversation. Likewise, the more people aggregate
in a particular city, the more likely a stranger will be to pick that city
as his destination. The big get bigger and the small stay small, or get relatively
smaller.
A great illustration of preferential attachment can be seen in the mushrooming
use of English as a lingua franca—though not for its intrinsic
qualities, but because people need to use one single language, or stick to
one as much as possible, when they are having a conversation. So whatever
language appears to have the upper hand will suddenly draw people
in droves; its usage will spread like an epidemic, and other languages will
be rapidly dislodged. I am often amazed to listen to conversations between
people from two neighboring countries, say, between a Turk and an Iranian,
or a Lebanese and a Cypriot, communicating in bad English, moving
their hands for emphasis, searching for these words that come out of their
2 2 0 THOSE GRAY SWANS OF EXTREMISTAN
throats at the cost of great physical effort. Even members of the Swiss
Army use English (not French) as a lingua franca (it would be fun to listen).
Consider that a very small minority of Americans of northern European
descent is from England; traditionally the preponderant ethnic
groups are of German, Irish, Dutch, French, and other northern European
extraction. Yet because all these groups now use English as their main
tongue, they have to study the roots of their adoptive tongue and develop
a cultural association with parts of a particular wet island, along with its
history, its traditions, and its customs!
Ideas and Contagions
The same model can be used for the contagions and concentration of
ideas. But there are some restrictions on the nature of epidemics I must
discuss here. Ideas do not spread without some form of structure. Recall
the discussion in Chapter 4 about how we come prepared to make inferences.
Just as we tend to generalize some matters but not others, so there
seem to be "basins of attraction" directing us to certain beliefs. Some ideas
will prove contagious, but not others; some forms of superstitions will
spread, but not others; some types of religious beliefs will dominate, but
not others. The anthropologist, cognitive scientist, and philosopher Dan
Sperber has proposed the following idea on the epidemiology of representations.
What people call "mêmes," ideas that spread and that compete
with one another using people as carriers, are not truly like genes. Ideas
spread because, alas, they have for carriers self-serving agents who are interested
in them, and interested in distorting them in the replication
process. You do not make a cake for the sake of merely replicating a
recipe—you try to make your own cake, using ideas from others to improve
it. We humans are not photocopiers. So contagious mental categories
must be those in which we are prepared to believe, perhaps even
programmed to believe. To be contagious, a mental category must agree
with our nature.
NOBODY IS SAFE IN EXTREMISTAN
There is something extremely na?ve about all these models of the dynamics
of concentration I've presented so far, particularly the socioeconomic
ones. For instance, although Merton's idea includes luck, it misses an additional
layer of randomness. In all these models the winner stays a winFROM
MEDIOCRISTAN TO E X T R E M I S T A N . AND BACK 2 2 1
ner. Now, a loser might always remain a loser, but a winner could be unseated
by someone new popping up out of nowhere. Nobody is safe.
Preferential-attachment theories are intuitively appealing, but they do
not account for the possibility of being supplanted by newcomers—what
every schoolchild knows as the decline of civilizations. Consider the logic
of cities: How did Rome, with a population of 1.2 million in the first century
A . D . , end up with a population of twelve thousand in the third? How
did Baltimore, once a principal American city, become a relic? And how
did Philadelphia come to be overshadowed by New York?
A Brooklyn Frenchman
When I started trading foreign exchange, I befriended a fellow named Vincent
who exactly resembled a Brooklyn trader, down to the mannerisms of
Fat Tony, except that he spoke the French version of Brooklynese. Vincent
taught me a few tricks. Among his sayings were "Trading may have
princes, but nobody stays a king" and "The people you meet on the way
up, you will meet again on the way down."
There were theories when I was a child about class warfare and struggles
by innocent individuals against powerful monster-corporations capable
of swallowing the world. Anyone with intellectual hunger was fed
these theories, which were inherited from the Marxist belief that the tools
of exploitation were self-feeding, that the powerful would grow more and
more powerful, furthering the unfairness of the system. But one had only
to look around to see that these large corporate monsters dropped like
flies. Take a cross section of the dominant corporations at any particular
time; many of them will be out of business a few decades later, while firms
nobody ever heard of will have popped onto the scene from some garage
in California or from some college dorm.
Consider the following sobering statistic. Of the five hundred largest
U.S. companies in 1957, only seventy-four were still part of that select
group, the Standard and Poor's 500, forty years later. Only a few had disappeared
in mergers; the rest either shrank or went bust.
Interestingly, almost all these large corporations were located in the
most capitalist country on earth, the United States. The more socialist a
country's orientation, the easier it was for the large corporate monsters to
stick around. Why did capitalism (and not socialism) destroy these ogres?
In other words, if you leave companies alone, they tend to get eaten up.
Those in favor of economic freedom claim that beastly and greedy corpo2
2 2 THOSE GRAY SWANS OF EXTREMISTAN
rations pose no threat because competition keeps them in check. What I
saw at the Wharton School convinced me that the real reason includes a
large share of something else: chance.
But when people discuss chance (which they rarely do), they usually
only look at their own luck. The luck of others counts greatly. Another
corporation may luck out thanks to a blockbuster product and displace
the current winners. Capitalism is, among other things, the revitalization
of the world thanks to the opportunity to be lucky. Luck is the grand
equalizer, because almost everyone can benefit from it. The socialist governments
protected their monsters and, by doing so, killed potential newcomers
in the womb.
Everything is transitory. Luck both made and unmade Carthage; it
both made and unmade Rome.
I said earlier that randomness is bad, but it is not always so. Luck is far
more egalitarian than even intelligence. If people were rewarded strictly
according to their abilities, things would still be unfair—people don't
choose their abilities. Randomness has the beneficial effect of reshuffling
society's cards, knocking down the big guy.
In the arts, fads do the same job. A newcomer may benefit from a fad,
as followers multiply thanks to a preferential attachment-style epidemic.
Then, guess what? He too becomes history. It is quite interesting to look
at the acclaimed authors of a particular era and see how many have
dropped out of consciousness. It even happens in countries such as France
where the government supports established reputations, just as it supports
ailing large companies.
When I visit Beirut, I often spot in relatives' homes the remnants of a
series of distinctively white-leather-bound "Nobel books." Some hyperactive
salesman once managed to populate private libraries with these
beautifully made volumes; many people buy books for decorative purposes
