100 books like Chaos

Professor Kahneman’s ideologies on decision-making have helped me in business and my personal life.

His insights have enhanced my decision-making process and helped me navigate the strait between instinct and decision. His insights have encouraged me to delegate routine decisions, allowing me to reserve my mental energy for the most critical choices.

Raymond Smullyan is a riddler, a puzzler, well-known for various Knights and Knaves puzzles, a type of logic game where some characters can only answer questions truthfully, and others only falsely. However, I recommend this book as here he offers not only logical tricks but many insights too. One section offers the World's shortest explanation of Gödel's theorem which is a magnificent achievement but frankly, reminds me why I like long explanations sometimes.

Basically, this is an examination of boolean logic, which is (rather boringly) a branch of algebra in which all operations are either true or false, and relationships are expressed with logical operators such as and, or, or not. So it’s serious stuff, but also pretty funny along the way.

Shortly after college, I was at a house party, and I headed into one of the hosts’ bedrooms to escape the ruckus. This book was sitting on their desk, and the cover looked intriguing, so I picked it up and started reading. I must have been there for an hour or more, reading story after story, while the party raged outside the door. 

Reading Borges felt like the discovery of the wellspring from whence everything else I loved had sprung. Here was fiction written in the earliest moments of the data revolution, fearlessly pursuing infinity and somehow capturing it so efficiently that it could be contained within a few pages of printed text.

Of course, “The Library of Babel” had been a touchstone in computer science and information science circles long before I discovered it, and it’s still the best shorthand way to express certain important concepts. It might be… show more.

We absorb this tale, like Peter Pan's, from childhood, and it provides us all with a leaning to light-hearted fantasy and a story pattern of leaving the real world and returning to it. An adventure may begin by going through a wardrobe as in the first Narnia novel, or into and out of Tom Bombadil's Old Forest in Tolkien. Alice goes down a rabbit hole. There are rabbit holes, wardrobes, forests, sailboats.... The world Alice gets to is full of strangeness appealed to me for Orpheus Rising whose characters have a similar variety.

This is the book that got me thinking about thought experiments. It really opened up my eyes to a whole new way of thinking – mainly by introducing me to the wonderfully playful, indeed modern style of writing that Galileo used to present his groundbreaking scientific theories – way back in seventeenth-century Italy!

Sorenson is a philosophy professor and goes on a bit, but his book was also groundbreaking in a way. My own books owe him a debt and for scholarly types, he also suggests a general theory "of" thought experiments: meaning what they are, how they work, and what is good - and bad - about them.

Full disclosure: Laura DeNardis is a good friend and former colleague of mine. But I was a fan before I was a friend, and thus far, The Internet In Everything is her crowning achievement, so I feel very comfortable listing it here as an absolute must-read.

When Laura told me she was going to write this book, my first thought was, “I wish I’d thought of that!” and my second thought, a nanosecond later, was, “Thank goodness I didn’t because she’ll do it a million times better.”

DeNardis is the reigning monarch of Internet Governance Studies, meaning she researches all the weird laws, policies, technologies, businesses, agencies, and practices that have built the internet and keep it ticking. You’d think the subject would be boring or impenetrable to us mere mortals, but her genius is in making it not only understandable but downright fascinating.

She understands the internet the way… show more.

While I’ve spent much of my career debunking the Random Walk Theory and the Efficient Market Hypothesis, I believe you need to understand where we’re coming from in order to develop new ideas.

Cootner’s anthology contains all of the important early writings that became Capital Market Theory. You will find Bachilier’s original paper from 1900 postulating using statistics to analyze markets. Mandelbrot’s original paper suggesting that markets are not a random walk is here, too. 

It’s an important time capsule of the development of market theory. I’ve read it extensively because you can’t criticize widely held ideas unless you know them yourself.

Readers of this list may be surprised that there are no books by Benoit Mandelbrot, the father of fractals. I found his books fascinating but frustrating. Feder’s book, by contrast, was readable and usable.

This book taught me how to do fractal analysis. While Feder’s book has nothing to do with markets, it has everything to do with applications. While I reuse much of Feder’s methodology in my books, readers will find it useful to see other practical applications of fractal analysis.

Fractals are a combination of chance and rules, randomness and order. This book gives us multiple examples of how important randomness and uncertainty are to evolution, adaptability, and innovation.

This book is not about the markets, but it does show us how the element of uncertainty that cannot be eliminated from investing is crucial to the functioning of markets and other non-linear dynamical systems. Since risk and uncertainty are closely tied, understanding how chance functions in the development of markets will help in the development of market strategies.

The Austrian School of Economics has been completely non-mathematical. Yet their concepts have direct analogies to complexity theory. Reading this book gives you fundamental economic ideas that tie back to the mathematical foundations of complexity, chaos, and fractals.

When dealing with markets, which are made up of people, after all, I have always found that basing your ideas on behavior rather than pure mathematics is always the way to go. Otherwise, you will not know when the markets have changed, and your ideas may no longer work.

This book also brings us back to the idea of cycles and explains them in an intuitive way. O’Driscoll and Rizzo also write well, so this isn’t a dry academic overview. It is a book that gives you both theory and intuition.