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What is a grey swan event?

A grey swan event is an unpredictable event that has potentially severe consequences. Unlike black swan events, which are completely unexpected, grey swan events can be anticipated to some degree but are still very impactful when they occur.

What are some key characteristics of grey swan events?

There are a few key characteristics that define grey swan events:

  • Potentially severe impact – Grey swan events can have major negative effects when they happen.
  • Somewhat predictable – While not fully predictable, there are usually some warning signs or precursors that suggest a grey swan event could occur.
  • Beyond normal expectations – The impacts of grey swan events fall far outside the realm of regular expectations.
  • Rare – Grey swan events do not happen very often, which makes their effects more surprising.

In summary, grey swan events are impactful and relatively rare occurrences that go beyond normal expectations but still have some degree of foreseeability. They sit between expected regular events (white swans) and completely shocking black swan events on the predictability spectrum.

What are some examples of grey swan events?

Here are a few examples of major grey swan events from recent history:

  • COVID-19 pandemic – While infectious disease experts warned of potential pandemics, the scale and impact of COVID-19 exceeded most predictions.
  • 9/11 terrorist attacks – The threat of terrorism was recognized but the extent of the 9/11 attacks surpassed expectations.
  • Dot-com bubble burst – The unsustainability of dot-com companies was discussed ahead of time but the severity of the crash was unanticipated.
  • Fukushima nuclear disaster – Experts identified risks associated with the Fukushima plant but the chain of events leading to meltdown went beyond probabilistic risk assessments.

Other examples include major cyberattacks with widespread impacts, devastating natural disasters like tsunamis and earthquakes, and unexpected geopolitical events like Russia’s invasion of Ukraine in 2022.

How do grey swan events differ from black swan events?

The main difference between grey swan and black swan events is the extent to which they are unpredictable and unforeseen:

  • Black swan events – Completely unexpected and without any prior indication or warning signs. Virtually impossible to predict at all.
  • Grey swan events – Not completely unanticipated or shocking due to some preceding indicators and warnings, but their likelihood and impacts are still underestimated.

Some other differences:

Black Swan Events Grey Swan Events
Almost zero ability to predict Some ability to predict, even if underestimated
No prior evidence or warning signs Some evidence exists but is often dismissed
Massively consequential impacts Major and severe impacts
Change underlying assumptions and mental models Don’t fundamentally change assumptions and models

In short, grey swan events have some anticipatory indicators whereas black swan events are total surprises when they occur. Both can be highly impactful.

What causes grey swan events?

There are a few broad factors that can lead to or amplify the effects of grey swan events:

  • Cognitive biases – Things like confirmation bias, anchoring, and disregard of probability can lead us to ignore or downplay warning signs.
  • Statistical rarity – The relative rarity of grey swan events makes them hard to analyze and predict accurately.
  • Interconnected systems – As systems become more interconnected, local disturbances can cascade in unpredictable ways.
  • Misaligned incentives – Short-term incentives may encourage undue downplaying of low probability risks.
  • Intentional adversaries – Belligerent actors who strategically plan surprise attacks or disruptions.

These factors can result in grey swan blind spots where a potential event is technically foreseeable but its likelihood and impacts are severely underestimated. Being aware of these causal factors can help identify areas where grey swans may be lurking.

How can organizations mitigate risks from grey swan events?

While grey swan events can’t be predicted with certainty, organizations can take steps to reduce risks and enhance resilience when they do occur:

  • Conduct scenario analysis – Explore a range of hypothetical scenarios, including low probability but high impact events.
  • Monitor leading indicators – Watch for early warning signals even if faint or ambiguous.
  • Question assumptions – Challenge conventional wisdom and mental models about stability.
  • Adopt a robust systems approach – Build in redundancy, diversity, and loosely coupled components.
  • Encourage whistleblowing – Create channels for voicing warnings and concerns.
  • Develop contingency plans – Prepare options in advance for responding to surprises and shocks.
  • Stress test strategies – War game to surface vulnerabilities and points of failure.

Taking prudent steps like these can help organizations navigate grey swan events more effectively and potentially even gain competitive advantage from them.

What role does complexity play in grey swan events?

Complexity is a key driver of many grey swan events for several reasons:

  • Complex adaptive systems exhibit nonlinear dynamics that make precise prediction difficult if not impossible.
  • More complexity means more points of interaction and failure that can amplify unanticipated disturbances.
  • Tight coupling and overoptimization in complex systems reduce redundancy and resilience.
  • Complex technologies can interact in unexpected ways and produce emergent behavior.

Complexity science suggests that shocks and surprises are almost inevitable in sufficiently complex systems. This implies that complexity itself is a root cause of many grey swan events. Concentrating populations, economic activity, and infrastructure in complex urban systems may increase grey swan risks.

How have concepts around grey swans evolved over time?

Understanding of grey swan events has evolved as scholars have built on earlier ideas:

  • The black swan theory introduced by Nassim Taleb focused attention on highly improbable events and their consequences.
  • Normal accident theory showed how complexity breeds unavoidable failure.
  • Research on normalizing deviance revealed how organizations drift into danger by downplaying signals.
  • The grey swan concept was introduced by John Schroeter to describe events between normal expectations and black swans.
  • Subsequent research has refined the grey swan concept and its implications for risk management.

As knowledge advances, the goal is to continually improve capacities to detect, analyze, and manage grey swan risks while avoiding complacency. Societal awareness of grey swans is still evolving.

What are some criticisms and limitations of the grey swan concept?

There are a few notable criticisms and limitations around the grey swan concept:

  • The boundaries between black swans, grey swans, and other risk categories are fuzzy.
  • Calling an event a grey swan is often just hindsight bias after it occurs.
  • The concept may encourage passivity by overstating unpredictability.
  • Difficult to falsify since definitions are loose and based on personal judgment.
  • Does not provide an operational framework for measuring or forecasting grey swan risks.

In general, grey swan is more of a conceptual metaphor than a precise risk measurement tool. It serves to direct attention but requires rigor and diligence to take action on grey swan insights.

How might analysis of grey swans evolve in the future?

Some ways analysis of grey swan events could evolve include:

  • More computational scenario modeling and simulation of complex systems.
  • Incorporating behavioral science insights into cognitive biases and human error.
  • Monitoring diverse online data in real-time to detect emerging anomalies.
  • New statistical techniques to analyze fat-tailed distributions and uncertainty.
  • Synthesis of interdisciplinary perspectives on complexity, risk, and systems thinking.
  • New visualization tools and metaphors to conceptualize grey swan risks.

Grey swan research will likely involve extensive data analysis, complexity modeling, forecasting methodologies, and collaborative human-machine systems. The goal is to envision and prepare for consequential scenarios that defy tidy definition but warrant diligent attention.


Grey swan events occupy an ambiguous middle ground between the unforeseen impacts of black swans and the predictable regularity of normal expectations. Their rarity and severity means they merit special consideration in risk management and systems design. While true black swans cannot be predicted by definition, identifying and analyzing potential grey swans can help strengthen resilience when turbulent events do materialize. As systems and societies become more complex and interconnected, mindful monitoring for grey swan storm clouds will grow in importance.