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Peanut Allergies and Energy

Peanut allergies impact 0.6–3% of the population, but it’s estimated that 65% of schools have some accommodation for kids with peanut…
Peanut Allergies and Energy

Peanut allergies impact 0.6–3% of the population, but it’s estimated that 65% of schools have some accommodation for kids with peanut allergies. Why?

The answer is something Nassim Nicholas Taleb called “the minority rule” whereby small (3–4% of the total population), but a virtuous group can force the entire population to submit to their preferences.

I choose a rather simple and light-hearted example, but the implications of this mental model are quite important.

Values in society don’t change on consensus. They change when the most intolerant group imposes their will on others. The most motivated emerge with new norms that are likely to be binary and stable.

Revolutions are unarguably driven by an obsessive minority. The entire growth of a society, including economic, comes from a small number of people. — Taleb

Minority rules occasionally create subconscious counterfactual biases. Look no further than organic foods. We’ve been trained to believe that the absence of an “organic” label means a given product is inferior or that GMO’s are present if there is an absence of a “no GMOs” label.

Can you imagine this happening with sustainable products?

There are two conditions that must be present in order to create an opportunity for minority rule to dictate to the majority.

The first is geography. The minority that imposes the rules on the majority must live within the general population. Ex. consumers with peanut allergies impact where peanuts served and most labels.

The second is cost. Manufacturing the product to comply with the minority rule cannot cost significantly more. The cost of not serving peanuts or adding a warning label is minuscule. In the same way, producing clean energy is no longer more costly than fossil fuels.

Surprisingly, there are few examples as it relates to energy. Auto-emissions are the most obvious ones. California sets the standard and manufacturers follow in spite of EPA rollbacks under the Trump administration.

If the minority rules, where does that leave the majority and how do we affect change?

The majority of American’s believe in man-made climate change and think we should do something about it. The popularity of the energy transition is clear and polls show the majority of Americans want to move to an economy powered by clean energy. So why have we been so slow to adapt until now?

The majority perspective requires drastic changes to energy supply, transportation, agriculture, etc.; however, few strong proponents of these policy changes are actually ‘walking the talk’ because of the difficulty and undesirability of these abstract policies in terms of personal impacts.

How many people do you know that are: vegan, don’t fly on airplanes, don’t use plastics, etc… and also believe in climate change? Not many, and it’s possible you never will.

Despite knowing climate change is a problem, for the average person change is simply too inconvenient — which makes technology and innovation, our best levers to a more sustainable future. Innovation is a minority premise — ~2.5% of us are innovators.

Markets evolve from asymmetric minorities with skin in the game. Energy will be no different.