The Asymetry of Death

I’ve been waiting to post this for Halloween, when most of us get dressed in fun costumes or walk around with our children in a light-hearted celebration of candy.  Not too long ago the day was All-Hallows’ Eve, the day before All Souls’ Day, when the spirits of departed loved ones were honestly believed to come back and share a day (and a night) with the living.  The rite goes back to pagan celebrations of the harvest and spirits of the dead.  For thousands of years, this was an attempt to deal with the inevitable reality of death and the harshness of non-existence that awaits us all.  That reality, though, has some very real consequences for how we deal with risks.

One common way of thinking about risk is to break events into a combination of “impact” versus “likelihood of happening.”  Some event that has a high score on both is obviously important to think about.  Something that scores high on “impact” but low on “likelihood” may be just as important as something else that scores low on “impact” but high on “likelihood.”  Image a scale from 1 to 10 for both factors.  It’s not one or the other that really matters – it’s the product of the two that counts.  For example, having a hole in my pocket that lets pennies fall out every time I walk is a high likelihood (say 9) but low impact (say 0.1) event.  In contrast, identity theft of my bank account is a low likelihood (say 0.1) but high impact (say 9) event.  In this view of risk, they have the same score: 0.1 * 9 = 0.9 and it makes sense to worry about one just as much as the other.  But this isn’t how humans react to risks, for a very important reason: the two factors aren’t equivalent.  And they aren’t equivalent because death exists on the downside, but there is no equivalent “upside” event to counter it.  In scientific terms, death breaks the symmetry.

What do I mean?  Well, let’s think about pushing things to two limits: a really high impact event that has a very very small chance of happening (like becoming disabled in a bad accident and not being able to work) versus a really low impact event that is almost guaranteed to happen (like wearing out your favorite clothes and having to spend money to buy new ones).  You can come up with plenty of different examples (your house is hit by a falling tree or a meteor vs. leaving the lights on or the computer on all night), and in each case, the one with the high impact (and low likelihood) is the one that clearly matters more.  Why?  Because, on the scale of “good things happening”, the existence of death – either financial or physical – is an absolute minimum whereas there is no absolute maximum on the other side.  On the ‘up’ side, you can always have more time to enjoy your family and friends, and you can always accomplish more and earn more money.  But the ‘down’ side has this minimum that you can’t go lower than.  You can’t be deader than dead.  You can be mostly dead, but once you’re all dead, even Miracle Max can’t help you out.  That’s symmetry breaking.  That fact makes catastrophic events – even if they are infinitesimally unlikely – much more important to us than small impact events that are assured to happen.  That’s what makes risk management necessary.

So, in a very real way, the existence and finality of death is why we all practice risk management.

Happy Halloween!

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