100 books like Chaos

Based on scientific arguments, this book shows how strongly incorrect drives are stuck in our brains, causing us to think that we are making a logical decision, while this is not the case.

The best example I tell everybody: Look at your attic that you want to clean out. You empty your cupboards, and almost always, a large part goes back into the cupboard because it is a waste. But if you are offered the same stuff for free, you usually don't want it.

The message of this example: Your brain finds it difficult to get rid of something you have, and it is a non-rational reaction that occurs in our fixed brain.

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.

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.

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.

Wheatley took me into the world of interconnectedness and systems in leadership and organisations on a relational level long before systems became a hot topic in leadership and organisations. She described the world of work I could see but didn’t yet live in.

Though published more than 30 years ago, its strategies and practical advice for leaders are as powerful and relevant now as they were surprising and challenging in terms of the accepted wisdom of the leadership of that time.

Though science isn’t my thing, I love how Wheatley blends science–insights from chaos theory, quantum physics, and biology–to open up an understanding of organisational dynamics and emergence. I love the note of optimism running through the book that would surely stir all but the most ‘set in their ways’ leaders to different action.

In a study of great conceptual daring, Hayles examines the links between scientific chaos theory and the representations of disorder in modern literature, from Stanislaw Lem to Doris Lessing. She is more or less unique in the present day in being able to align hard science with contemporary aesthetics, a world away from the half-digested appropriation of scientific chatter by those who love nothing better than an algorithm. Her grasp of contemporary theory is sound, and her readings of modern literature are sensitive and enlightening.