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The Fat Tail by Ian Bremmer and Preston Keat

The Fat Tail’s central argument is that businesses rarely forecast and prepare for political risks as well as they do economic ones, which is a mistake because most political risks can be found in the “Fat Tail” of probability charts, where unlikely but high impact events reside.

The first chapters make the case for considering political risks with greater weight. After than, they launch into a primer on the various types of political risk and the analytical tools used to understand and forecast them. These later chapters are filled with examples of companies that sucesfully saw and prepared for change, and those that did not. The book is great at helping frame the problem and how diverse the impacts of political risk can be, but is not of much use in taking the next step — making some risk calculations and acting accordingly. I expect their firm will see a but more business now…