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Dragon king is a double metaphor for an event that is both extremely large in size or impact and born of unique origins relative to its peers. DK events are generated by or correspond to mechanisms such as positive feedback, tipping points, bifurcations, and phase transitions, that tend to occur in nonlinear and complex systems, and serve to amplify DK events to extreme levels. By understanding and monitoring these dynamics, some predictability of such events may be obtained.
The dragon king theory was developed by Didier Sornette, who hypothesizes that many crises are in fact DKs rather than black swans—i.e., they may be predictable to some degree. Given the importance of crises to the long-term organization of a variety of systems, the DK theory urges that special attention be given to the study and monitoring of extremes, and that a dynamic view be taken. From a scientific viewpoint, such extremes are interesting because they may reveal underlying, often hidden, organizing principles. Practically speaking, one should study extreme risks, but not forget that significant uncertainty will almost always be present, and should be rigorously considered in decisions regarding risk management and design.
The DK theory is related to concepts such as black swan theory, outliers, complex systems, nonlinear dynamics, power laws, extreme value theory, prediction, extreme risks, and risk management.