About the speaker:
Didier Sornette is Professor on the Chair of Entrepreneurial Risks at the Swiss Federal Institute of Technology Zurich (ETH Zurich). He is also a professor of the Swiss Finance Institute, and a professor associated with both the department of Physics and the department of Earth Sciences at ETH Zurich. He was previously a Professor of Geophysics at UCLA, Los Angeles California and a Research Professor in Physics at the French National Centre for Scientific Research, working on the theory and prediction of complex systems. He has published 8 books and more than 600 peer-reviewed papers.
Extreme events are often associated with power law statistics. Indeed, it is a popular belief that “wild randomness’’ is deeply associated with distributions with power law tails characterized by small exponents. In other words, power law tails are often seen as the epitome of extreme events (the “Black Swan’’ story). Here, we document in very different systems that there is life beyond power law tails: power laws can be superseded by “dragon-kings’’, monster events that occur beyond (or changing) the power law tail. Dragon-kings reveal hidden mechanisms that are only transiently active and that amplify the normal fluctuations (often described by the power laws of the normal regime). The good news is that Dragon-kings may be predictable and controllable.