Unless consequential decisions are taken by people who pay for the consequences, the world would vulnerable to total systemic collapse. Skin in the game –as a filter –is the central pillar for the organic functioning of systems, whether humans or natural. My argument is that there is a more essential aspect: filtering and the facilitation of evolution.

For the central attribute is symmetry: the balancing of incentives and disincentives, people should also penalized if something for which they are responsible goes wrong and hurts others: he or she who wants a share of the benefits needs to also share some of the risks. What is Skin in the Game? The phrase is often mistaken for one-sided incentives: the promise of a bonus will make someone work harder for you. The same logic mysteriously answers many vital questions, such as 1) the difference between rationality and rationalization, 2) that between virtue and virtue signaling, 3) the nature of honor and sacrifice, 4) Religion and signaling (why the pope is functionally atheist) 5) the justification for economic inequality that doesn’t arise from rent seeking, 6) why to never tell people your forecasts (only discuss publicly what you own in your portfolio) and, 7) even, how and from whom to buy your next car. When selecting a surgeon for your next brain procedure, should you pick a surgeon who looks like a butcher or one who looks like a surgeon? The logic of skin in the game implies you need to select the one who (while credentialed) looks the least like what you would expect from a surgeon, or, rather, the Hollywood version of a surgeon. What do I mean by Skin in the Game? My Own Version

The black swan skin in the game