Marko Papip
Geopolitical Alpha
Geopolitics has always been an intriguing puzzle to me—an intricate, multi-layered game theory problem with no obvious level of abstraction to rely on. Nations are governed by individuals whose decision-making processes do not always align with the interests of the sovereign entities they represent. For example, Marko Papic highlights that during the 2019 Brexit negotiations, Boris Johnson was effectively playing a three-level game: managing internal Tory divisions, securing Conservative dominance over Labour, and navigating Britain’s global standing. Only by considering the interplay of these three games could an analyst make an informed prediction about the negotiation outcomes—alongside subtler but equally significant dynamics, such as Brussels’ incentive to “make an example out of Britain.”
“Preferences are optional and subject to constraints; constraints are neither optional nor subject to preferences.”
Unsurprisingly, Geopolitical Alpha takes a strongly practical approach—its focus is on gaining an edge, not on theoretical analysis. Papic’s primary goal is to provide readers with a method for evaluating geopolitical events through the lens of investment decisions, accounting for both uncertainty and market positioning. He explicitly presents his framework as descriptive rather than prescriptive—designed to understand the world as it is, rather than how it should be. In this pursuit, he champions what he calls “professional nihilism.”
Overall, Geopolitical Alpha has given me a sharper lens through which to refine my probability assessments of global events.
Notes
The constraints framework
- Dialectical Materialism (Marx): Material reality dictates outcomes more than ideology or personal preferences.
- Diagnosticity of Constraints: To understand geopolitical decisions, we need data points that help distinguish between competing hypotheses.
- Person vs Situation Bias: People tend to over-attribute decisions to individual agency rather than the structural constraints shaping their actions.
Types of constraints
- Political
- Economic
- Financial
- Geopolitical
- Legal
- Wildcard / black swan e.g. pandemic or natural disaster