Ergodicity Economics
How irreversible outcomes affect long-term performance in work, investing, relationships, sport, and beyond
2025-12-20 by Luca Dellanna
Ergodicity
How irreversible outcomes affect long-term performance in work, investing, relationships, sport, and beyond
Some reviews
"One of the most important books I've read, period. It's short, articulate, and expansive on a singular subject matter — ergodicity, which is really the key ingredient to success in life, marriage, business, family, happiness, health, etc."
Blake Janover
CEO, Janover Inc.
"One of the most important books for everyone to read. Ergodicity should be taught in school and it should be a common metric in businesses that leaders pay attention to and are deliberate about."
Matt Cannon
"A fascinating book […] Once I started, I couldn't put it down […] the math is minimal, and Luca treats the subject well. I wish I had read it two years earlier"
Robert Matthews
VP of Engineering, Equifax
"One of the very best books I read about risk management. A must read."
Alessandro Francescotto
Partner, Excellence Consulting
"Profoundly insightful [...] If you are someone who often needs to make decisions under uncertainty and using incomplete information (which I think applies to most of us), then Ergodicity is a must-read."
Dev Ashish
StableInvestor Founder
"Brilliant. Must read."
N. S. Ramnath
Journalist & Author
"A brilliant, concise, thought-provoking gem. A must-read for investors."
Rakesh
Investor
"A great book for those who quickly want to familiarize themselves with the concept of ergodicity. The author goes to great lengths explaining the concept in easily understandable terms. Highly recommended!"
Auke Hunneman
BI Norwegian Business School
"It helped clarify several longstanding pragmatic questions I had about uncertainty and risk [...] a lucid explanation, accessible for a general audience."
Pankaj Saikia
Datafarer co-founder.
"Excellent book. Highly recommended. Luca compresses a lot of wisdom and actionable guidance into few words. No fluff, no fillers, only thought through foundational ideas."
Eleanor Berger
AI consultant
Ergodicity Economics is a field examining "the implications of ergodicity on mainstream economic theory." The discipline demonstrates how averages cannot be extrapolated when irreversibility exists, and why long-term investments require different evaluation approaches than short-term ones.
When outcomes are irreversible, you cannot simply look at averages to predict long-term performance. Understanding this principle is crucial for making better decisions in investing, career choices, and life strategies.If you want to learn more, I wrote a book on ergodicity to make these concepts accessible and practical for general audiences.
Key researchers in the field
Ole Peters and Alexander Adamou authored the seminal paper "Ergodicity Economics," which formed the foundation for much of the modern work in this field. Their research demonstrates fundamental flaws in how traditional economics treats risk and time.
Nassim Nicholas Taleb introduced me to ergodicity through his works Skin in The Game and Antifragile. His practical approach to understanding risk under uncertainty helped bridge the gap between theory and application.
Other important contributors include Murray Gell-Mann, Ed Thorp, John Larry Kelly Jr., Harry Crane (who writes an excellent Substack on Risk, Intuition, and Common Sense), and Joseph Norman.
Why this matters
The implications of ergodicity extend far beyond academic economics:
- Investing: Why some strategies work on paper but fail in practice
- Career choices: How to evaluate opportunities with irreversible consequences
- Relationships: Understanding commitment and long-term dynamics
- Sport and performance: Training strategies that account for injury risk
- Business strategy: Making decisions when failure means game over
My contribution
I wrote my book on ergodicity because the original academic papers, while groundbreaking, were excessively technical and abstract. My goal was to translate these powerful ideas into practical frameworks that anyone can use to make better decisions.
I've also published original research on ergodicity as a non-binary property and on risk-taking dynamics in various contexts.
What readers say
The book has received consistently high ratings (5/5 stars), with reviewers calling it "one of the most important books" they've read and emphasizing its practical value for decision-making under uncertainty.
If you're interested in understanding how to make better long-term decisions, especially when facing irreversible outcomes, I encourage you to check out the book.