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The Great Game Theory Guide: #3 — What is the Black Swan Effect?
Q. Lewis, what is a Black Swan Event, and what is its importance in Applied Game Theory (HAGT)?
A. Before I answer this question it may be of value for you to get a basic introduction/simple explanation of the basics of game theory. Below is an article (a 6 minutes read) as well as a more in-depth video. Both were created so they would be understood aby 12-year-old.
The Article:
The Video:
https://www.youtube.com/watch?v=8hRf87puZPY&t=147s
A. A Black Swan Event is a metaphor that describes an unexpected event (one that comes as a surprise), has a major effect, and is often inappropriately rationalized through various biases with the benefit of hindsight after the fact. The term is based on an old saying that presumed black swans did not exist — a saying that was applied to the experiences of Europeans when they did encounter them.
