Wednesday, 6 May 2015

Predicting Black Swan Events from Statistics and the Publishing Busness

As you might know, a Black Swan event is something that is unexpected, difficult to predict from trend analysis.  Stock market crashes are a case in point.

Yesterday, we had an election in my province, where a party that had been in power for 44 years (yes, you read that right) was thrown over for a totally new party.  While people thought it had to happen sooner or later, it still took a lot of people by surprise. 

But below is a graph that might be a good indicator of a Black Swan event's likely occurrence.   It shows the accelerating turnover of leaders of the party.  Interestingly enough, the function looks to be a lot like a power law, though naturally the domain and range are quite restricted.  Power laws show up freqently in human affairs, so perhaps this shouldn't be a surprise.

Basically, the graph seems to be saying, that as the Black Swan event approaches, the underlying system grows unstable, and at an accelerating pace.  In this instance, the political party in question took to changing leaders frequently, as it felt its grip on power eroding.  No doubt this was partly due to infighting at the top, but it was probably also a sort of flailing in the collective unconscious of the party..

So, what does this say about publishing.  Simply, that as disruption grows more severe in the business of producing and distributing books, we should expect to see these sorts of phenomena occurring - changes in CEOs, companies being quickly bought and sold, rapid swings in share prices, shorter and shorter stays on the best-seller lists, and so forth.

Watch for these signs, and perhaps profit by them.

And don't forget that "On the Road with Bronco Billy - A Trucking Journal" is free this weekend (Wednesday May 6 to Sunday May 10) on Amazon.

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