396 Book Reviews Better Angels of Our Nature. Risk Analysis, 2012; 32(7):1270– 1272. 2. Roh S. Review of Nate Silver, The Signal and the Noise. Risk Analysis, 2014; 34(2):396–398. 3. International Risk Governance Council, Improving the Management of Emerging Risks: Risks from New Tech- nologies, System Interactions, and Unforeseen or Changing Circumstances, Geneva, Switzerland, 2011. Available at: http://www.irgc.org/IMG/pdf/irgc er2conceptnote 2011.pdf, Accessed on October 20, 2013. 4. Ellsberg D. Risk, ambiguity, and the savage axioms. Quarterly Journal of Economics, 1961; 75(4):643–669. 5. Phimister JR, Bier VM, Kunreuther HC (eds). Accident Precursor Analysis and Management, Washington, DC: Na- tional Academy Press, 2004. Available at: http://www.nap.edu/ catalog.php?record id=11061. 6. Raiffa H. Decision Analysis: Introductory Lectures on Choice Under Uncertainty, Reading, MA: Addison-Wesley, 1968. 7. Clemen R. Making Hard Decisions: An Introduction to Deci- sion Analysis. Belmont, CA: Duxbury Press, 1990. 8. Howard RA. Decision Analysis: Applied Statistical Decision Theory, Proceedings of the Fourth International Conference on Operational Research, 1966. Reprinted in: Howard, RA, Matheson JE (eds). Readings on the Principles and Applica- tions of Decision Analysis. Menlo Park, CA: Strategic Deci- sions Group, 1989. 9. Howard RA. The Foundations of Decision Analysis, IEEE Transactions on Systems Science and Cybernetics, SSC-4, 1968. Also reprinted in Howard and Matheson, eds., 1989 (see Ref. 8). The Signal and the Noise: Why So Many Predictions Fail—But Some Don’t by Nate Silver, New York Penguin Press. 2012 Reviewed by Sungjong Roh* Cornell University Prophesy is a good line of business, but it is full of risks.—Mark Twain Human beings have an extraordinary capacity to ignore risks that threaten their livelihood, as though this will make them go away. (1) Nate Silver’s book is a must-read for risk ana- lysts. It is well written, charts his personal career and learning experiences, and is a good reference and teaching aid for risk analysis. Silver covers a wide range of applications of statistics and prediction. His prose is clear and accessible to nonspecialists. Silver writes from experience: he has been a player in sev- eral of the fields he writes about, such as poker be- ginning in the early 2000s. His blog, FiveThirtyEight- DotCom, has a large following and has recently left the New York Times, relaunching with ESPN. The * Address correspondence to Sungjong Roh, Cornell University, Department of Communication, 212 Kennedy Hall, Ithaca, NY 14853, USA; sr767@cornell.edu. Signal and the Noise was chosen as the best 2012 book in the nonfiction category by Amazon’s editors. (2) The book focuses on forecasting and prediction, which are key components of risk analysis. It also an- alyzes how (mis)prediction plays a key role in risk management. The chapters cover financial risks (e.g., recent financial crisis and sports betting), health and environmental risks (e.g., the spread of infectious dis- eases, global climate change, and weather forecast- ing), and catastrophic risk (e.g., terrorism and full nu- clear core meltdown). The book consists of 13 chapters. The first half of the book analyzes problems with predictions. The three chapters after the Introduction illustrate re- cent prominent prediction failures (e.g., electoral forecasts, the financial crisis of the late 2000s, and baseball). Chapters 4–7 address “dynamic systems,” which increase the overall complexity and difficulty of making effective and accurate predictions. After showcasing various failures and difficulties in predic- tion, the author turns to solutions. The second half of the book is Silver’s guide to Bayesian forecasting methods. Chapters 8–10 ex- plore Bayes’s theorem and apply it to predictions in sports, chess, and poker. Chapters 9–12 address issues more germane to human survival and well- being, such as global warming, terrorism, and finan- cial market bubbles and crashes. The author de- scribes several compelling real-world cases. He an- alyzes the September 11 attacks in 2001, the finan- cial crisis in 2008, and flu predictions in 2009. His more distant historical examples include the Decem- ber 1941 attack on Pearl Harbor and the disintegra- tion of the Soviet Union. These examples vividly il- lustrate the perils of failed forecasts. Silver describes his own successes in prediction using the metaphor of the differences in decision making utilized by the fox and the hedgehog. (3,4) Sil- ver admires the fox for its ability to take multiple approaches to a problem and finds the hedgehog too stubborn, overconfident, and ideological to learn from its mistakes. The author identifies three main principles: (1) probabilistic thinking—to craft a range of plausible outcomes instead of selecting one, (2) course correct- ing analysis—to update a prediction as newer and more valid information becomes available, and (3) consensus—aggregate or group forecasts are more accurate than individual ones, applying multiple viewpoints toward a problem. In addition, the au- thor articulates the importance of weighing different