Which is more dangerous, a gun or a swimming pool? What do schoolteachers and sumo wrestlers have in common? Why do drug dealers still live with their moms? How much do parents really matter? How did the legalization of abortion affect the rate of violent crime?
These may not sound like typical questions for an economist to ask. But Steven D. Levitt is not a typical economist. He is a much-heralded scholar who studies the riddles of everyday life—from cheating and crime to sports and child-rearing—and whose conclusions turn conventional wisdom on its head.
Freakonomics is a groundbreaking collaboration between Levitt and Stephen J. Dubner, an award-winning author and journalist. They usually begin with a mountain of data and a simple question. Some of these questions concern life-and-death issues; others have an admittedly freakish quality. Thus the new field of study contained in this book: Freakonomics.
Through forceful storytelling and wry insight, Levitt and Dubner show that economics is, at root, the study of incentives—how people get what they want, or need, especially when other people want or need the same thing. In Freakonomics, they explore the hidden side of . . . well, everything. The inner workings of a crack gang. The truth about real-estate agents. The myths of campaign finance. The telltale marks of a cheating schoolteacher. The secrets of the Ku Klux Klan.
What unites all these stories is a belief that the modern world, despite a great deal of complexity and downright deceit, is not impenetrable, is not unknowable, and—if the right questions are asked—is even more intriguing than we think. All it takes is a new way of looking.
Freakonomics establishes this unconventional premise: If morality represents how we would like the world to work, then economics represents how it actually does work. It is true that readers of this book will be armed with enough riddles and stories to last a thousand cocktail parties. But Freakonomics can provide more than that. It will literally redefine the way we view the modern world.
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About the Author
Steven D. Levitt, a professor of economics at the University of Chicago, was awarded the John Bates Clark Medal, given to the most influential American economist under forty. He is also a founder of The Greatest Good, which applies Freakonomics-style thinking to business and philanthropy.
Stephen J. Dubner, an award-winning journalist and radio and TV personality, has worked for the New York Times and published three non-Freakonomics books. He is the host of Freakonomics Radio and Tell Me Something I Don't Know.
Stephen J. Dubner is an award-winning author, journalist, and radio and TV personality. He quit his first career—as an almost rock star—to become a writer. He has since taught English at Columbia, worked for The New York Times, and published three non-Freakonomics books.
Read an Excerpt
What Do Schoolteachers
and Sumo Wrestlers
Have in Common?
Imagine for a moment that you are the manager of a day-care center. You have a clearly stated policy that children are supposed to be picked up by 4 p.m. But very often parents are late. The result: at day's end, you have some anxious children and at least one teacher who must wait around for the parents to arrive. What to do?
A pair of economists who heard of this dilemma -- it turned out to be a rather common one -- offered a solution: fine the tardy parents. Why, after all, should the day-care center take care of these kids for free?
The economists decided to test their solution by conducting a study of ten day-care centers in Haifa, Israel. The study lasted twenty weeks, but the fine was not introduced immediately. For the first four weeks, the economists simply kept track of the number of parents who came late; there were, on average, eight late pickups per week per day-care center. In the fifth week, the fine was enacted. It was announced that any parent arriving more than ten minutes late would pay $3 per child for each incident. The fee would be added to the parents' monthly bill, which was roughly $380.
After the fine was enacted, the number of late pickups promptly went ... up. Before long there were twenty late pickups per week, more than double the original average. The incentive had plainly backfired.
Economics is, at root, the study of incentives: how people get what they want, or need, especially when other people want or need the same thing. Economists love incentives. They love to dream them up and enact them, study them and tinker with them. The typical economist believes the world has not yet invented a problem that he cannot fix if given a free hand to design the proper incentive scheme. His solution may not always be pretty -- it may involve coercion or exorbitant penalties or the violation of civil liberties -- but the original problem, rest assured, will be fixed. An incentive is a bullet, a lever, a key: an often tiny object with astonishing power to change a situation.
We all learn to respond to incentives, negative and positive, from the outset of life. If you toddle over to the hot stove and touch it, you burn a finger. But if you bring home straight A's from school, you get a new bike. If you are spotted picking your nose in class, you get ridiculed. But if you make the basketball team, you move up the social ladder. If you break curfew, you get grounded. But if you ace your SATs, you get to go to a good college. If you flunk out of law school, you have to go to work at your father's insurance company. But if you perform so well that a rival company comes calling, you become a vice president and no longer have to work for your father. If you become so excited about your new vice president job that you drive home at eighty mph, you get pulled over by the police and fined $100. But if you hit your sales projections and collect a year-end bonus, you not only aren't worried about the $100 ticket but can also afford to buy that Viking range you've always wanted -- and on which your toddler can now burn her own finger.
An incentive is simply a means of urging people to do more of a good thing and less of a bad thing. But most incentives don't come about organically. Someone -- an economist or a politician or a parent -- has to invent them. Your three-year-old eats all her vegetables for a week? She wins a trip to the toy store. A big steelmaker belches too much smoke into the air? The company is fined for each cubic foot of pollutants over the legal limit. Too many Americans aren't paying their share of income tax? It was the economist Milton Friedman who helped come up with a solution to this one: automatic tax withholding from employees' paychecks.
There are three basic flavors of incentive: economic, social, and moral. Very often a single incentive scheme will include all three varieties. Think about the anti-smoking campaign of recent years. The addition of a $3-per-pack "sin tax" is a strong economic incentive against buying cigarettes. The banning of cigarettes in restaurants and bars is a powerful social incentive. And when the U.S. government asserts that terrorists raise money by selling black-market cigarettes, that acts as a rather jarring moral incentive.
Some of the most compelling incentives yet invented have been put in place to deter crime. Considering this fact, it might be worthwhile to take a familiar question -- why is there so much crime in modern society? -- and stand it on its head: why isn't there a lot more crime?
After all, every one of us regularly passes up opportunities to maim, steal, and defraud. The chance of going to jailthereby losing your job, your house, and your freedom, all of which are essentially economic penalties -- is certainly a strong incentive. But when it comes to crime, people also respond to moral incentives (they don't want to do something they consider wrong) and social incentives (they don't want to be seen by others as doing something wrong). For certain types of misbehavior, social incentives are terribly powerful. In an echo of Hester Prynne's scarlet letter, many American cities now fight prostitution with a "shaming" offensive, posting pictures of convicted johns (and prostitutes) on websites or on local-access television. Which is a more horrifying deterrent: a $500 fine for soliciting a prostitute or the thought of your friends and family ogling you on www.HookersAndJohns.com ...
The foregoing is excerpted from Freakonomics by Steven D. Levitt and Stephen J Dubner. All rights reserved. No part of this book may be used or reproduced without written permission from HarperCollins Publishers, 10 East 53rd Street, New York, NY 10022
Table of Contents
An Explanatory Note xxiii
In which the origins of this book are clarified.
Introduction: The Hidden Side of Everything 1
In which the book's central idea is set forth: namely, if morality represents how people would like the world to work, then economics shows how it actually does work.
Why the conventional wisdom is so often wrong
How "experts"—from crimnologists to real-estate agents to political scientists—bend the facts
Why knowing what to measure, and how to measure it, is the key to understanding modern life
What is "freakonomics," anyway?
Chapter 1 What Do Schoolteachers and Sumo Wrestlers Have in Common? 15
In which we explore the beauty of incentives, as well as their dark side-cheating.
Who cheats? Just about everyone
How cheaters, cheat, and how to catch them
Stories from an Israeli day-care center
The sudden disappearance of seven millon American childern
Cheating schoolteachers in Chicago
Why cheating to lose is worse than cheating to win
Could sumo wrestling, the national sport of Japan, be corrupt?
What the Bagel Man saw: mankind may be more honest than we think
Chapter 2 How Is the Ku Klux Klan Like A Group of Real-Estate Agents? 51
In which it is argued that nothing is more powerful than information, especially when its power is abused.
Spilling the Ku Klux Klan's secrets
Why experts of every kind are in the perfect position to exploit you
The antidote to information abuse: the Internet
Why a new car is suddenly sorth so much less the moment it leaves the lot
Breaking the real-estate agent code: what "well maintained" really means
Is Trent Lott more racist than the average Weakest Linkcontestant?
What do online daters lie about?
Chapter 3 Why Do Drug Dealers Still Live with Their Moms? 85
In which the conventional wisdom is often found to be a web of fabrication, self-interest, and convenience.
Why experts routinely make up statistics; the invention of chronic halitosis
How to ask a good question
Sudhir Venkatesh's long, strange trip into the crack den
Why prostitutes earn more than architects
What a drug dealer, a high-school quarterback, and an editorial assistant have in common
How the invention of crack cocaine mirrored the invention of nylon stocking
Was crack the worst thing to bit black Americans since Jim Crow?
Chapter 4 Where Have all the Criminals Gone? 115
In which the facts of crime are sorted out from the fictions.
What Nicolae Ceauşescu learned—the hard way—about abortion
Why the 1960s was a great time to be a criminal
Think the roaring 1990s economy put a crimp on crime? think again
Why capital punishment doesn't deter criminals
Do police actually lower crime rates?
Prisons, prisons everywhere
Seeing through the New York City police "miracle"
What is a gun, really?
Why early crack dealers were like Microsoft millionaires and later crack dealers were like Pets.com
The superpredator versus the senior citizen
Jane Roe, crime stopper: how the legalization of abortion changed every-thing.
Chapter 5 What Makes A Perfect Parent? 147
In which we ask, from a variety of angels, a pressing question: do parents really matter? 147
The conversion of parenting from an art to a science
Why parenting experts like to scare parents to death
Which is more dangerous: a gun or a swimming pool?
The economics of fear
Obsessive parents and the nature-nurture quagmire
Why a good school isn't as good as you might think
The black-white test gap and "acting white"
Eight things that make a child do better in school and eight that don't
Chapter 6 Perfect Parenting, Part II; or: Would a Roshanda By Any Other Name Smell As Sweet? 181
In which we weigh the importance of a parent's first official act-naming the baby.
A boy named Winner and his brother, Loser
The blackest names and the whitest names
The segregation of culture: why Seinfeld never made the top fifty among black viewers
If you have a really bad banem should you just change it?
High-end names and low-end names (and how one becomes the other)
Britney Spears: a symptom, not a cause
Is Aviva the next Madison?
What your parents were telling the world when they gave you your name.
Epilogue: Two Paths to Harvard 209
In which the dependability of data meets the randomness of life.
Bonus Matter 213
"The Probability That a Real-Estate Agent Is Cheating You..." 215
Selected "Freakonomics" Columns From The New York Times Magazine 233
A Q&A with the Authors 261
What People are Saying About This
“Freakonomics is politically incorrect in the best, most essential way.... This is bracing fun of the highest order.”
“Steven Levitt has the most interesting mind in America... Prepare to be dazzled.”
Reading Group Guide
About the Book
Which is more dangerous, a gun or a swimming pool? What do schoolteachers and sumo wrestlers have in common? Why do drug dealers still live with their moms? How much do parents really matter? What kind of impact did Roe v. Wade have on violent crime?
These may not sound like typical questions for an economist to ask. But Steven D. Levitt is not a typical economist. He is a much-heralded young scholar who studies the riddles of everyday life -- from cheating and crime to sports and child-rearing -- and whose conclusions regularly turn the conventional wisdom on its head. He usually begins with a mountain of data and a simple, unasked question. Some of these questions concern life-and-death issues; others have an admittedly freakish quality. Thus the new field of study contained in this book: Freakonomics.
Through forceful storytelling and wry insight, Levitt and co-author Stephen J. Dubner show that economics is, at root, the study of incentives -- how people get what they want, or need, especially when other people want or need the same thing. In Freakonomics, they set out to explore the hidden side of ... well, everything. The inner workings of a crack gang. The truth about real-estate agents. The myths of campaign finance. The telltale marks of a cheating schoolteacher. The secrets of the Ku Klux Klan.
What unites all these stories is a belief that the modern world, despite a surfeit of obfuscation, complication, and downright deceit, is not impenetrable, is not unknowable, and - if the right questions are asked -- is even more intriguing than we think. All it takes is a new way of looking. Steven Levitt, through devilishly clever and clear-eyed thinking, shows how to see through all the clutter.
Freakonomics establishes this unconventional premise: if morality represents how we would like the world to work, then economics represents how it actually does work. It is true that readers of this book will be armed with enough riddles and stories to last a thousand cocktail parties. But Freakonomics can provide more than that. It will literally redefine the way we view the modern world.
- Most people think of economics as a dry subject matter concerning monetary and fiscal matters. How does Freakonomics change this definition?
- Freakonomics argues that morality represent the way we'd like the world to work, whereas economics can show how the world really does work. Do you agree?
- Freakonomics lists three varieties of incentives: social, moral, and financial. Can you think of others?
- Freakonomics shows how the conventional wisdom is often shoddily formed. What are some instances of conventional wisdom that you've always doubted?
- Does it seem as though "experts" truly hold too much power in the modern world, or are we lucky to have them?
- What are some issues in your daily life toward which you can apply some Freakonomics-style thinking?
- What were some of the most convincing arguments put forth in Freakonomics? What were some of the least convincing?
- How does the argument linking Roe v. Wade to a drop in crime change your thinking about abortion?
- How does the view of parenting in Freakonomics jibe with your own view?
- After reading Freakonomics, do you think that cheating is more prevalent or less prevalent than you thought it was before you read the book?
About the authors
Steven Levitt is a Professor of Economics at the University of Chicago and an editor of The Journal of Political Economy. In January 2004 he was awarded the John Bates Clark medal -- for the economist under 40 who has made the greatest contribution to the discipline -- by the American Economic Association.
Stephen J. Dubner is the author of Confessions of a Hero Worshiper and Turbulent Souls and is a former writer and editor at the New York Times Magazine. He lives in New York City with his family.
A Message from the Coauthor
Steven Levitt doesn't think like you and me. (Well, I can't vouch for you, but I can vouch for me.) He has a brain that seems to hum along on its very own frequency. He can look at some scenario -- the rise and fall of crime, the real-estate market, the modern obsession with competitive parenting -- and instantly begin to ask questions, and come up with answers, that are simply astounding. In retrospect, you may scratch your head and say, "Why didn't I think of that?" This is what makes his work so intoxicating: He answers the questions we haven't yet figured out how to ask.
Yes, it's true that Levitt is an economist. But never before has the so-called dismal science been given a less dismal presentation. As Levitt sees it, economics is a science with excellent tools for gaining answers but a serious shortage of interesting questions. His particular gift is the ability to ask such questions. For instance: If drug dealers make so much money, why do they still live with their mothers? Which is more dangerous, a gun or a swimming pool? What really caused crime rates to plunge during the past decade? Do real-estate agents have their clients' best interests at heart? Why do black parents give their children names that may hurt their career prospects? Do schoolteachers cheat to meet high-stakes testing standards? Is sumo wrestling corrupt?
Levitt works with data, mountains of it, and from his data he teases out stories that are often surprising and may even make us uncomfortable, but which are most likely true. Several years ago, for instance, he wrote a paper linking Roe v. Wade with a drop in crime. His thinking went like this: the women most likely to seek an abortion in the wake of Roe v. Wade -- poor, single, or teenage mothers -- were the very women whose children, if born, have been shown most likely to become criminals. But since those children weren't born, crime began to decrease during the years they would have entered their criminal prime.
Unlike a politician or a theologian or a paid pundit, Levitt is free to come up with answers based on nothing more complicated than the truth. Morality, it could be argued, represents the way that people would like the world to work -- whereas economics represents how it actually does work. The modern world, despite a surfeit of obfuscation, complication, and downright deceit, is not impenetrable, is not unknowable, and -- if the right questions are asked -- is even more intriguing than one might think. All it takes is a new way of looking. Stephen J. Dubner
Most Helpful Customer Reviews
This book is a general interest book- and it certainly is interesting. The book, for anyone looking for an entertaining read, will like it. In a nutshell, the book takes a look at all sorts of things in society, from crack gangs to parenting, and then attempts to make sense of them by applying econonmic principles. According to the book, economics is really the study of incentives, and so using this kind of angle, the book comes up with answers to why things work the way they do.
A book that's hard to put down, I'm sure many readers will enjoy it. Also recommend The Sixty-Second Motivator for a more simplistic explanation of what motivates people and gives them incentives to do what they do.
Freakonomics was a very good book. i thought this book was going to be one of those boring economics with only numbers and weird vocab books , but it turned out to be an easy read. i like the way the booked wasn't much address to the number but how to solve and achieve preblems in life and the connection with econommics; also hepls you understand things such as " why do drug dealers still live with their moms"(Freakonomics). a question answered in the book.
Freakonomics provides the reader with the chance to take a new perspective on many different topics. It answers a seemingly complex question of why exactly drug dealers live with their mothers and shows how gangs are the reason why. This book is one that you would not want to put down and will want to read it through to the end. I would suggest that everybody reads this book and learn from it some very hard lessons. A chapter in the book describes how criminologists incorrectly found the answer to the 1990's crime rate drop and how that drop is linked to the legalization of abortion. Levitt and Dubner also show how everybody responds to an incentive, comparing the prices real estate agents get for their house versus their clients; also providing why a sumo wrestler is like a school teacher. This book shows the reader the hidden side of decision-making and how the economy works. It provides an insight to the world of economists and into the world of both psychology and sociology. From the book you can learn ways to bring patterns out of data (even though this wasn't an intention of the book) which is a very valuable skill to have. Another thing to learn is that common, conventional wisdom is mostly made up of lies and is created by "experts" in their own interest. It explains how those experts manipulate people by using their ignorance against them, and hopefully will teach the reader not to believe everything they hear. This book is one that every person needs to read at some point in their life, as it provides many different answers to life's questions and presents the method for answering those. Those methods can be used to answer your own personal questions and will help you out during your entire life.
I listened to the audio book Outliers by Malcolm Gladwell before I listened to Freakonomics. They are similar in style -- drawing conclusions about modern phenomena based on outlying characteristics. But Gladwell does a better job of telling compelling stories. Freakonomics was more negative - discussing cheating teachers, drug gangs, etc. Gladwell found interesting correlations in less cynical subjects.
Freakonomics is certainly not the type of book I usually read, but I couldn't resist after all that I had heard about it. The six sections of the book, each bearing an intriguing title, explore truths behind modern day conventional wisdom, incentives, and morality. Covering a wide range of topics, from sumo wrestling to the bagel business to the Ku Klux Klan, the book offered a refreshing perspective to a few fascinating questions. Levitt's argument that legalized abortion played the central force behind the crime drop of the 1990s, though at first startling, seemed to be thoroughly supported with convincing evidence. This trend follows throughout the book, as the authors present plenty of statistics for each of their findings and let the numbers speak for themselves. Levitt and Dubner stand strong despite all controversy, further solidifying their arguments as well as making the expanded version an interesting read. Overall, the book was well-written and intended for a lay audience, straying away from sounding too scientific. Each chapter proved entertaining, as Dubner explains logical arguments with enthusiasm and a bit of humor. I truly enjoyed the eye-opening approach that Freakonomics offered and the strange topics of interest, learning much along the way.
Personally, the book did not appeal to me. But I have to agree that the book had a lot of interesting facts, and that I did learn a lot. It is an easy to read book and has humor, making the reading exciting to many.
I felt the book was interesting and intriguing. It breaks down the concepts of economics into bite-sized read. It's a fanatic book and a good read
I absolutely loved this book. As an economics major it is so great to see the field studied and written about in a practical use that the majority will find interesting, even without ever really understanding an economics class. The reasearch was very thorough and the book is so fun and unique. It is a must read! I read this when it first came out years ago and I have re-read it multiple times out of the pure enjoyment of it.
Freakonomics by Steven D. Levitt and Stephen J. Dubner is an easy, interesting book, even for people who do not usually like nonfiction or economics. Although based around economics the boook links people and situations that one would never believe could be linked before reading the book. With such chapters Why do drug dealers still with their parents? and What do sumo wrestlers and teachers have in common? the book only gives the facts about the situations and leaves readers up to the challenge of figuring out what these facts mean. As I opened the book I never believed it would keep my attention throughtout. But as the facts came out and two totally different situations were linked I couldn' t put the book down. This book is good for anyone intersted in learning random facts that can be turned into a whole diffrent level of learning. Fun and interesting this book could be read by almost anyone.
Reads like a magazine article stretched into a book.
As I¿m always weary of dubious, statistic-laden arguments to shore up various precautionary commercial-pitches, political agendas, or graduate thesis projects, this was a perfect book for me. Levitt ¿ as a ¿rouge economist¿ ¿ also utilizes sundry statistics and studies to expose aspects that tend to counter certain agendized truisms and the foundations of common-knowledge issues such as those espoused by irrefutable sources like the Today Show or some old guy at a bar. As the author eloquently states, ¿emotion is the enemy of rational argument,¿ so he takes seemingly random selections from the world of random things and posits arguments about how such things as personal incentive and marketing begin to dominate the way we operate and understand the world. Through a selective assemblage of studies, he debunks or sheds light on certain misconceptions such as my long-held belief that dealing crack simply has to be more economically viable than the continuation of an architecture career (turns out ¿ in Chicago anyway ¿ most of the dealers make less than minimum wage, whereas I¿ve always exceeded minimum wage by at least a couple bucks).I suppose my only issue with this book is the seemingly self-serving inclusion of fragments of Dubner¿s interview with Levitt as chapter heads. Certainly they have some relevance to the chapters itself, but seem like bothersome hagiographical inclusions that imply he¿s the only economist looking at the world from such a unique vantage point. It reminded me of that horrible Pollack documentary for Frank Gehry (when I say ¿for,¿ I mean it in the literal sense that this had to have been a birthday gift¿maybe a White Elephant gift). In this piece (or POS, if you will), Gehry is portrayed as the only creative light within a world of pencil-pusher, technocrat, Organization-Men architects. Much like one could easily counter that there are tons of better, more creative, and certainly more relevant architects than Gehry (though few using million-dollar-plus aerospace software programs), here I will only point out that the vast majority of Levitt¿s examples were proposed, studied, and concluded by other, presumably not-rogue, economists. He simply assembled them into a narrative (assuming he wrote all of this and not his NYT colleague).That being said, it¿s a thoroughly enjoyable read but, alas, he points out that the typical prostitute does make more money than the typical architect. As he also eloquently observes, ¿an architect is more likely to hire a prostitute than vice versa.¿ Of course, he wrongly assumes that we can afford such luxuries.
Ok. This book is hip and smart.Now we're waiting for something more concrete.Maybe a book on the '08-'09 Great Recession?
A very interesting look at some of the seemingly indirect relationships between random events and closely correlated outcomes. Very engaging, and an excellent read! I recommend reading this along with "The Tipping Point" and "Bl!nk" for a good view of opposing paradigms on socio-economic patters and their relative outcomes.
This book was plain amazing and i loved it. The way this guy thinks is kind of like mine and i enjoy that. I also like the fact that he knows he probably going to make some people mad, but he say what he wants anyway. This book is so strange that when he first talk about a subject that you are in disbelief. But after some run around and getting sidetracked a little, it makes perfect sense.
I had avoided this book for a while because I figured it would be way over my head with economics jargon. Boy, was I wrong - I finished this book feeling like I needed to sign up for some econ classes and learn to do what Leavitt does!
An eye-opening read about possible causes for seemingly unrelated events. I loved all the talk about analysing the data etc. The chapter on Perfect Parenting was particularly interesting, as was the Chicago Public School System study. My only fault would be that the sections were too short, I would have loved to have read more indepth on each topic. Looking forward to reading Superfreakonomics now.
Extremely fun and thought provoking! Highly recommended.
This book begins and ends with a comment about "unifying themes" and discards any need for them. Subsequently a series of unrelated curiosities are subjected to economic analysis, yielding interesting and indeed boggling results. The most controversial analysis reveals the impact of Roe v. Wade on the crime rate. The economic interest involved in Sumo wrestlers who take a dive we can easily extrapolate to other sports arenas -- World Cup soccer comes to my mind. I especially applaud Levitt's debunking of "experts," child psychologists, and marketeers who hawk their products while shamelessly twanging our heartstrings. I know it's easy to cheer for those we agree with, but this guy does his regression analysis in an extremely readable way, and analyzes things I'd never thought much about, like drug dealer board rooms. I suspect co-author Dubner's contribution has been to supply some kind of unifying thread anyway, via questions like "What do schoolteachers and Sumo wrestlers have in common?" The final one-two punch surprise ending, where Levitt shamelessly abandons all pretense of scholarship for showmanship, seems to have Dubner's thumbs all over it. But it still packs a wallop. Steven D. Levitt's voice is a clarion tenor in the swelling chorus of bahumbuggery.
Lots of interesting bits of information, but the authors explicitly refuses to set them into a larger argument (beyond "data sometimes upsets our expectations"). To my mind this ultimately reduces the book, demotes it to a form somewhere above trivia and somewhere below a Malcolm Gladwell book (Malcolm Gladwell books at least attempt to synthesize their interesting anecdotes into a larger thesis).
Great book! Puts into perspective the way we examine cause/effect and data analysis.
Levitt says morality is how we¿d like to see the world, economics is what¿s actually there. Bringing economics to the masses, he doesn¿t just make it fun, he makes it fascinating. I learned that the legalization of abortion in 1973 was the cause behind the drastic drop in crime in the 1990s, how often professional sumo wrestlers cheat, and how one¿s name affects one¿s monetary success in life, and is likewise affected by one¿s parents¿ monetary success in life. It¿s just over 200 pages, I whipped through it.
I was given this as a gift by beloved colleagues - and I'm happy to say that I thoroughly enjoyed reading it. The book's central theme, despite professing to have none, is about incentives and how they drive human behaviour - from crack dealers to sumo wrestlers and cheating teachers to real estate agents. To quote the authors, 'if morality is about how the world should be, then economics is about the way the world is'.The book provides witty and left-field analysis of data pertaining to a number of controversial modern social issues, including race and socioeconomics, abortion, education and best of all, crime. There is even a section dealing with trends in baby names that was rather enlightening. The expanded version also contains excerpts from the Freakonomics blog and newspaper articles.I'm still chuckling at the cited observation made by J.J Dilulio - "Apparently it takes a PhD in criminology to doubt that keeping dangerous criminals incarcerated cuts crime".
One sentence review: "An interesting book, but far from dazzling" Tardy to the party as usual, I recently got around to reading Freakonomics, after finding a copy laying around the office. I've been meaning to read this book for a while now, and having it fall into my lap seemed like fate. For those not familiar, Freakonomics is essentially a study in asking questions of data and undermining cultural narratives and popular knowledge. For example, gun control laws don't have the impact on crime that advocates claim, and names don't determine destiny so much as reveal information about parents. This is an interesting approach, though I don't know if it is revolutionary. Data-driven correlation analysis is fairly common in both business and academics. To see this touted as "dazzling" (per cover quote from Malcolm Gladwell), was a bit odd. The book covers what teachers have in common with Sumo wrestlers, and what the price of crack has to do with crime. All in all, it's an odd mosaic of topics that author Steven Levitt found interesting and could research using available data. There is no unifying theme except to say that correlation does not equal causation and sometimes causes are unexpected. The most controversial portion of the book is the investigation that Roe v. Wade is responsible for a large portion of the decline in crime in the 1990s. The theory is, unwanted children live poorly and are more likely to turn to crime. Abortion lowers the number of unwanted children. The pool of potential criminals gets smaller. Crime drops. I don't see much controversial about the logic here, though moralists and demagogues of all stripes may find complaints about the topic itself through their respective lenses. All in all, I learned some interesting trivia (pools are more dangerous to young children than guns, and there are 55 elite sumo wrestlers in Japan for example), but since data-driven analytics is part of my way of thinking already, I didn't find the book to be revolutionary. It was a fun read, and well-written, but not the most enjoyable or informative book I've read recently. I guess I just don't see what all the fuss is about, really.
It's a quick read and provides some interesting observations, but the incessant self-congratulatory motif starts grating really quickly.
An unorthodox economist uses his Sherlock Holmes-like ability to evolve the operative incentives from the actors' point of view, then find novel ways to pull valid tests of his hypothesis out of the data. Fascinating and enlightening.