Black Swan Event
News: Army Chief Gen Manoj Pande has urged the forces to always be prepared for ‘black swan’ events’.
Black Swan Event:
- A black swan is a rare, unpredictable event that comes as a surprise and has a significant impact on society or the world.
Origin:
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- The black swan theory was put forward by author and investor Nassim Nicholas Taleb in 2001, and later popularised in his 2007 book – The Black Swan: The Impact of the Highly Improbable.
- This work is one of the 12 most influential books since World War II.
Features: These events have three distinguishing characteristics:
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- They are extremely rare and outside the realm of regular expectations;
- They have a severe impact after they hit; and
- They seem probable in hindsight when plausible explanations appear.
Example:
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- 2008 global financial crisis, fall of the Soviet Union etc.
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