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Life seems illogical sometimes. Individuals do risky things: take drugs, have unprotected sex, mug each other. If you've ever been in love, you know how crazy it feels, and divorce rarely looks like a rational process. The unfathomable appears on a larger scale: why do some neighborhoods thrive while others become ghettos, some cities live while others die? Why is the United States a democracy while China is not? Thorny questions, and you might think the outcome is impossible to predict. But economists believe ...
Life seems illogical sometimes. Individuals do risky things: take drugs, have unprotected sex, mug each other. If you've ever been in love, you know how crazy it feels, and divorce rarely looks like a rational process. The unfathomable appears on a larger scale: why do some neighborhoods thrive while others become ghettos, some cities live while others die? Why is the United States a democracy while China is not? Thorny questions, and you might think the outcome is impossible to predict. But economists believe that life is logical, and rational patterns often underpin what looks like chaos or confusion.
THE LOGIC OF LIFE reveals that rational behavior appears in the most unexpected places: drug addicts and muggers behave rationally. Suburban sprawl and inner city decay also follow rational patterns. Economics can explain how teenagers decide whether or not to have sex, why your boss is overpaid, and why your neighborhood is segregated. Using economic tools to pry open the secrets of human behavior, THE LOGIC OF LIFE unifies the new economics and accessibly presents for the first time its compelling strengths and frustrating blind spots.
Starting with the most intimate decisions, THE LOGIC OF LIFE shows, against all expectations, that unlikely people in unlikely situations are responding rationally to far-off costs and benefits. Then the scope broadens to show the logic of the family, of neighborhoods, corporations, and even civilization itself. This is the new economics of everything you never thought was economics, and it will help you see the world in a new way.
Financial Timesand Slate.com columnist Harford (The Undercover Economist)provides an entertaining and provocative look at the logic behind the seemingly irrational. Arguing that rational behavior is more widespread than most people expect, Harford uses economic principles to draw forth the rational elements of gambling, the teenage oral sex craze, crime and other supposedly illogical behaviors to illustrate his larger point. Utilizing John von Neumann and Thomas Schelling's conceptions of game theory, Harford applies their approach to a multitude of arenas, including marriage, the workplace and racism. Contrarily, he also shows that individual rational behavior doesn't always lead to socially desired outcomes. Harford concludes with how to apply this thinking on an even bigger scale, showing how rational behavior shapes cities, politics and the entire history of human civilization. Well-written with highly engaging stories and examples, this book will be of great interest to Freakonomicsand Blinkfans as well as anyone interested in the psychology of human behavior. (Feb.)Copyright 2007 Reed Business Information
“[Tim] Harford sets off on an enormously entertaining yarn backed by the findings of expert economists. He spins playfully, but smartly, across matters of sex, crime, gambling, addiction, marriage, racism, ghettos and politics, and he makes it all, well, titillating at times. Really.”
“Harford has a knack for explaining economic principles and problems in plain language and, even better, for making them fun.”
–The New York Times
“[Harford] is an amiable guide for the non-specialist reader . . . but his command of the subject is such that even a well-schooled economist will discover much that is new.”
“Highly engaging . . . entertaining and provocative.”
“A fascinating work with many ‘aha’ moments.”
“Smart, charming, penetrating, and wise.”
–Stephen J. Dubner, co-author of Freakonomics
“Chock-full of numbers and money talk, but oddly entertaining.”
“Charming and informative.”
“Like Harford’s earlier book, The Undercover Economist–if you haven’t got it, get it–this book uses the basic theory of rational choice to make transparent the logic behind common but important puzzling phenomena. Even a trained economist can enjoy discovering what he didn’t realize he already knew. I did.”
–Thomas C. Schelling, 2005 Nobel Laureate in Economics
“This witty, intelligent book will help you see the entire world in a new light.”
–Tyler Cowen, author of Discover Your Inner Economist
Chapter One Introducing the Logic of Life The Economics of Sex, Crime, and Minnie Mouse Harpo Studios, Chicago
Parents, brace yourselves." With those words, Oprah Winfrey introduced America to the shocking news of the teenage oral sex craze. In The Atlantic, Caitlin Flanagan wrote, "The moms in my set are convinced-they're certain; they know for a fact-that all over the city, in the very best schools, in the nicest families, in the leafiest neighborhoods, twelve- and thirteen-year-old girls are performing oral sex on as many boys as they can." Flanagan poked a bit of fun, but she wasn't really laughing: She was convinced that the fears were largely justified. Indeed, the American "blow job epidemic" has now been addressed everywhere from PBS documentaries to the editorial page of The New York Times, sometimes with giddy and slightly voyeuristic horror, sometimes with calm reassurance that the epidemic is simply a myth.
The so-called epidemic is often exaggerated, but it's no myth. One recent study, conducted by researchers at Johns Hopkins Bayview Medical Center in Baltimore, found that between 1994 and 2004, young people between ages twelve and twenty-four became more than twice as likely to report that they'd recently had oral sex. (For boys the rate climbed from 16 percent to 32 percent; for girls, from 14 percent to 38 percent.) Anecdotal evidence from experts suggests that the true increase may be even higher. I sought advice from Professor Jonathan Zenilman, an expert at Johns Hopkins University on sexually transmitted diseases. He explained to me that in 1990, perhaps half the women and a quarter of the men who came to his clinic (both teenagers and adults) sometimes performed oral sex on their partners. He believes that oral sex is now much more common: "Now it's seventy-five to eighty percent." And while it's the blow jobs that predictably have caused the panic, oral sex is now much more equitably distributed between boys and girls than in 1990. "Epidemic" might be putting it too strongly, but oral sex is definitely in vogue.
The question few people seem to have asked is "Why?" Are kids really becoming more depraved-or are they just being smart? Might there not be such a thing as a rational blow job? I'll say more about exactly what rational means later in this chapter, after we've dealt with those libidinous teenagers. But the basic idea is not complicated: Rational people respond to trade-offs and to incentives. When the costs or benefits of something change, people change their behavior. Rational people think-not always consciously-about the future as well as the present as they try to anticipate likely consequences of their actions in an uncertain world.
Armed with this basic definition of rationality, then, we can ask: What are the costs, benefits, and likely consequences of a blow job? Okay, perhaps the benefits are too obvious to be stated, particularly for the recipient. But it should also be obvious that the cost of a close relative of oral sex has risen: Regular sex is more costly than it used to be because of the spread of HIV/AIDS. HIV is much more likely to be spread by regular sex than oral sex. Many teenagers know that: One recent study of sex education concluded that it was more common for U.S. kids to be taught about HIV/AIDS than about preventing pregnancy. Teenagers may also know of other sexually transmitted diseases such as gonorrhea, an infection that might make a girl infertile if transmitted through penetrative sex, but when transmitted by oral sex may have much milder symptoms, such as a sore throat. The costs of oral sex are, quite simply, lower than the costs of regular sex. ...
One: Introducing the Logic of Life Two: Las Vegas Three: Is Divorce Underrated?
Four: Why Your Boss is Overpaid Five: In the Neighborhood Six: The Dangers of Rational Racism Seven: The World is Spiky Eight: Rational Revolutions Nine: A Million Years of Logic