Chapter 2
Risk, Uncertainty, Probability, and Luck
Managing risk requires thinking about risk, and thinking about risk requires thinking about and being comfortable with uncertainty and randomness. It turns out that, as humans, we are often poor at thinking probabilistically. We like certainty in our lives and thinking about randomness does not come naturally; probability is often nonintuitive. We should not abandon the effort, however; just as we can learn to ride a bike as a child we can learn to think probabilistically. Doing so opens horizons, allows us to embrace the fluid, uncertain nature of our world.
This chapter focuses on how to think about risk, uncertainty, and probability. This chapter provides some of the tools we will use throughout the rest of the book, but more importantly, it helps us move from the world as rigid and fixed to a world that is changeable and contingent, which helps us explore the wonderful complexity of our world.
