Freakonomics: a rogue economist – Is that all there is?
The title of Freakonomics tells us that Steven Levitt is a “rogue economist” exploring the “the hidden side of everything.” I have always been up for a rogue telling me about everything. Even a rogue telling me about anything appeals to me; you know that special insight that only a mischievous, perhaps unprincipled, but somehow likeable person has. From the title I even conjured up some noble rogue elephant tearing apart the civilized world after suffering a loss of habitat. I was up for rogue. Economics, I thought, is a damn good place for a rogue.
Levitt is an economics professor at the University of Chicago and a winner of the John Bates Clark Medal. That medal is awarded every two years to the best economist under 40. It is given by the American Economic Association. If you know anything about this Vanderbilt University supported organization, it wouldn’t be for their search for rogues (although they got Milton Friedman right in 1951.)
Steven Levitt is best-known for his findings on America’s falling crime-rate during the 1990s. Teenage murder rates were predicted to double. Instead they fell by more than 50% in the space of five years. By 2000 they were at their lowest in 35 years. But why? Well, a lot of people were taking the credit. They were citing economic growth, gun control, policing, imprisonment and even the death penalty as the reason. Levitt proved the cause as Roe vs Wade, the Supreme Court decision that lead to the repeal of abortion laws in the US. His research showed that children born into impoverished environments were more likely to grow up to become criminals. His analysis formed the elegant but uncomfortable syllogism: “Unwantedness leads to high crime; abortion leads to less unwantedness; abortion leads to less crime.”
Levitt is saying, according to Dubner, that incentives and motivations are intimately linked in driving human behaviour. No breakthrough – my mum knew that! He does come through with some interesting proofs. His ingenious methods of analysing data reveal sometimes startling conclusions: Chicago public school teachers were helping their students cheat on state exams; Sumo wrestlers were fixing some of their matches; real-estate agents don’t really care about how much they sell your house for – only their own house, and my favourite; dope-dealers rarely make a good living. These results do amuse, surprise and even educate. In all these conclusions there is a haunting. Strangely, within these intriguing anomalies we never find that superbly-skilled rogue practitioner of economics. Instead we are left with a peppy little repertoire of cocktail chatter (beer-chat for me) and little else.
Something went wrong in the writing of Freakonomics. In the reading there was the echo of Mark Twain’s comment that golf was “a good walk spoiled.” Yes it is provocative and interesting but it has a problem. If Malcolm Gladwell of Tipping Point fame says “Steven Levitt has the most interesting mind in America . . .” then the problem is uncompromisingly simple – we can’t find Levitt or his mind in this book!
Without question we can find – actually, we can’t get away from – the other Stephen, Stephen Dubner. He is Levitt’s coauthor and a contributor to the New York Times. Dubner occasionally genuflects to Levitt’s genius, to his unique insight, and treats us to the odd passing anecdote. For most of the book though he relies on the coattails of Levitt to spin his own story.
Dubner just doesn’t get Levitt. A flaw, especially given the hype in the title. He tells us that this very special economist is challenging the established lens through which we see conventional economics. The problem is what is conventional is never argued and the nature of the difference is never revealed. This new lens, we are told, uncovers – no exposes – the patterns of conventional thinking. These come by way of conclusive moments, end points really, that are sometimes remarkably fascinating and clearly capture interest. The question is, are these moments, this shopping-list of results, the only point of the book?
Although Steven Levitt is apparently (or even paradoxically) the coauthor, he never actually appears. Not only is he not there but his methodology is never fully presented nor explained. Malcolm Gladwell goes on to say “. . . and reading Freakonomics is like going for a leisurely walk with him on a sunny summer day, as he waves his fingers in the air and turns everything you once thought to be true inside out.” Well the problem is we never get to go on that walk with Steven Levitt. He just might be nearby, but you never know for sure.
The book is a first-person telling by Dubner. So it leaves Dubner responsible for that walk. It also leaves him responsible for the non-telling of either process or personality. It is an issue of depth. His preamble, along with the very bad An Explanatory Note are ill-chosen attempts at building an arcane, deified and mystical Steven Levitt. When we get into the book, we think we are going to meet Levitt, this “rogue economist” – but we never do.
Dubner continually misses the mark. He let a good book and a great opportunity slip away. This is because he thinks the mark is simply some captivating Levitt conclusion. Even though I found myself relishing some of these points and was more than willing to tell these little tidbits to my friends; they leave forever undone some important thinking.
The success of the book is that each story is portable. In their portability there is a weakness. If the point is, each story is an indicator of how we can mis-see the world, then how do we understand mis-seeing or recognise mis-telling? The only way to know would be to understand Levitt, economics, and the processes by which we make conventional and sometimes remarkably wrong conclusions.
We never do. Instead, in each story there is an echo of missed opportunity. In each he takes us on some short walk on how we might see the world. The trouble is it is only a short walk with no critical path to understand how we got there or just where we might be going.
Dubner tells us early on that when the publisher approached Steven Levitt, Levitt didn’t want to write a book. He finally did agree to write it, but along with Dubner who had done a story about him for the Times. So Dubner and the brilliant Levitt agree to coauthor. Freakonomics is the result of that division of labour. Presumably Levitt’s job was to continue mining of the reality of the “hidden side of everything.” Then what was Stephen Dubner’s job? The answer: The weaver of these disparate stories; the interpreter; the pattern-finder – the writer! Unfortunately a substantive telling never happens. It takes about half the book to slowly realize Dubner doesn’t really get Levitt – and neither do we.
In the end this book bizarrely peters off into some kind of parenting manual. This is presumably because Dubner and Levitt are young fathers. Who knows? Dubner then thinks he can put Humpty back together by saying in the Epilogue that there is “no unifying theme” in Freakonomics. Well he got that right! Here he is alluding to a quote by the philosopher Robert Nozick where Nozick said that at 26 Levitt didn’t need a “unifying theme” as an economist. This may be right for a young economist – but it is not necessarily true of a book.
Dubner’s patchwork attempt at an ending only exacerbates the reality of missed opportunity. Unfortunately it causes Freakonomics to read a bit like: What my really important really smart friend did on his summer vacation.
One of the most interesting topics in Freakonomics, is that of bad assumptions in causality. These are made when people consider causality regarding a particular event, and they making assumptions that are affected by factors such as self-interest, prejudice, common sense, etc. The book shows that when the right questions are asked and their answers are searched in a bigger context, some unrelated causes may happen to trigger the original event. An example from the book is how crime rate had fallen in the US during the mid-90’s after years of increasing and contrary to the most predictions. The authors noted that legalizing abortion in 1973, which is totally unrelated to crime, is what mainly led to the fall in crime rate. They argue that most unwanted children who are most likely to have criminal tendencies, were not born anymore because of the said legalization. Most people would assume that crime rate had fallen because of the strong economy or because of new police strategies or whatever. But when you look at the bigger picture, the real chain of events may begin to materialize. The book helps knowing how to differentiate good assumptions from the bad ones. A very helpful tool in this is the study of incentives.
People respond to anything according to their incentives. An incentive can range from money to something as vague as inner peace. In the previous example, treasury people will want to believe that a strong economy helped bringing crime rates down. The police chief will most likely convince himself and other people that his new police strategies are the major contributor to the fall. Some may think that God intervened and helped. This may seem a very simple idea, but when it comes to everyday life, everyone’s incentive is not that clear. An example to this is that of real estate agents. The book demonstrates how real-estate agents will in all likelihood convince you to sell your house at a price that they would not approve if they were themselves the owners of your house. Their explanation is quite simple and plausible: When you're the owner of the house, an increase of 10000$ means a mere couple of hundred dollars for the agent, whereas that is not the case when the agent is the owner.
I’m not an expert in the field, but I believe that statistical analysis and its implications are not always applicable on the individual level because it cannot make cut and dry conclusions, and we don't like that individually. Maybe it can help us be more observant, but that has significant side effects, with the most probable one being confusion. The authors claim that the book will help people individually, but I think it can be of much help to corporations or groups.
Another problem I've realized is the correlation of data, which may lead to contradicting outcomes as happened in this very book. In one study, the authors show that parents with high income are most likely to raise a successful kid. Yet, in another study near the end of the book they show that the parents’ economic status does not affect their child’s success in life at all, since other factors may be at play. I know that in statistics, it is very natural that individual cases may contradict with one another which is something inherent in the nature of statistics, but when entire statistical outcomes contradict, I think the method used can fairly be deemed inefficient.
This was much more enjoyable than reliable, except for the last chapter about names which I believe was a total waste of time. I think that rather than providing anything new, the book is a practical training about a much older wisdom, the maxim of Cassius, which was quoted by Cicero: n Cui bono?n
A very interesting take on real-life situations using principles of economic theory. Seems forced at some places but if looked at objectively it does make sense. For real it's economic steak on a hot plate, with a side of a motley collection of interesting stories.
Disappointed in the wordiness and round about way the authors' presented their data. The chapter introductions were so far away from the chapter contents it was humorous. I did notice how the authors' went around their elbows to get to their thumbs and tried to show a correlation, but I found sifting through the multitude of off-topic data tiresome.
Also, the way they presented their data took forever for them to get to the point. Often, they contradicted or repeated themselves or beat a topic into the dirt until I just moved on.
It was like reading a student thesis. Lots of facts and figures, great detail placed on how those facts and figures were gathered (justification), the ENTIRE story of how those facts and figures came about--including the urination ritual, colors of the buildings and other useless information. Egads!
I have the hardcover and though it shows 320 pages (through the index) the actual book information stops at page 191. The rest is "bonus" material, notes and index.
What's inside:
- Numerous ways a teacher can cheat on state testing for their students. Mind boggling.
- Great detail into the lives of a sumo wrestler. Good grief.
- Interesting info on how a Real Estate Agent can dupe a seller. Hmm.
- Way too much information about the Klu Klux Klan. Mercy! That could have been summed up so much quicker!
- The study of the college kid that practically lived with a gang in Chicago for 6 years in order to do research was interesting, at first, then it dragged out. Was it necessary to report how they urinated on the 6th floor of the building where they hung out? Was it necessary to report the color scheme of the buildings? Ugh.
- The chapters on what makes a perfect parent (I and II) were interesting. They dismantled a lot of current speculation as to putting kids into school as early as possible, reading to them as often as possible, etc will make them better students; thus, more productive citizens in society.
Moms who have kids after age 30 tend to be better parents, yet if a mom has her first child before age 30, then has another after age 30 it doesn't matter.
Found the section on selecting a child's name to be interesting, but conflicting. Lots of lists of "great names" (over and over again) followed by the story of Winner and Loser--two brothers. Guess who became successful and who didn't? Winner=criminal; Loser=detective who went by various names including Lou.
I became frustrated in this section, because they contradicted themselves (or left loopholes).
i was totally unimpressed. i didn't even finish. i know people like this one, but something about the constant references to levitt's genius and "rogue-ish-ness" turned me off. if someone is brillian i think it should come across in their writing with out having to assert it in the introduction. oh! and the part at the beginning where he wonders how the homeless guy can afford headphones, and this is suppossed to be an example of how uniquely his mind works?! please.
I had high expectations for this book based on all of the hype. It's been on my to-read list for a long time, and after finally got around to reading it, I came away disappointed. The book is mostly a disjointed series of unexpected pairings phrased as questions, like "What do sumo wrestlers and real estate agents have in common?" Most of the questions would never be anything an average person would ask or wonder about. The book was a haphazard compilation of these pairings and odd questions but, to be fair, the authors explicitly state that from the get-go. I found the sections on parenting and naming babies to be the most interesting, with the rest of it being on the dull side.
Many of these questions felt artificially contrived to create a "freaky" spin on economics but it felt forced. That was my chief issue with the book - it felt like it was trying to hard to be edgy and hip, like a geeky kid who tries to impress by looking cool and winds up falling flat.
I found Dan Arielly's book, Predictably Irrational to be much more entertaining with a smoother flow. Arielly's book deals with behavioral economics and delves into the reasons why people make the choices they do, some of which seem rational but aren't and others which seem irrational but aren't. Arielly's book left me with a greater insight into my own choices and the mechanisms at work behind them. Freakonomics left me with a general thought of "Hmm, seemingly unrelated stuff is actually related and vice versa."
For anyone interested in behavior economics presented in a very accessible and entertaining manner, I would recommend Arielly's book over Freakonomics, hands down.
اخلاق اون چیزیه که ما دوست داریم دنیا اون طوری بچرخه اما اقتصاد اون طوریه که دنیا واقعا میگرده.
من با این کتاب از طریف پادکست بی پلاس آشنا شدم. کتاب فضای جالبی داشت. من خیلی با علم اقتصاد آشنا نیستم ولی احساس میکنم بیشتر از این که این کتاب به اقتصاد مربوط باشه به آمار مربوطه. چرا که از آمار برای توضیح پدیدههای قابل لمس استفاده کرده بود و نتایج جالبی رو به دست آورده بود.
درس مهمی که من از این کتاب گرفتم اعتماد نکردن به حرف کارشناس هاس. اینکه چقدر میتونن دلایل اشتباهی برای اتفاقات ارائه بدن و یا گاهی اطلاعی رو از قصد ارائه میدن تا ما رو بترسونن مثل یه مشاور مسکن که به ما میگه اگه خونمون رو به اولین مشتری ای که اومه نفروشیم احتمالا زیان زیادی خواهیم کرد و ما به خاطر اطلاعاتی که داره احتمالا بهش اعتماد میکنیم.
বইটা অর্থনীতির বই ভেবে পড়া শুরু করেছিলাম। কিন্তু এটাকে অর্থনীতির বই মানতে আমি রাজি না, এটা সমাজবিজ্ঞানের বই। সমাজবিজ্ঞানের সাথে অর্থনীতির সম্পর্ক আছে ঠিক, কিন্তু এভাবে বললে মোটামুটি সব বিদ্যার সাথেই অর্থনীতির সম্পর্ক আছে; পরিবেশবিজ্ঞান থেকে পদার্থবিজ্ঞান, সবই অর্থনীতির বই।
যাহোক লেখক দুইজন পৃথিবীর শীর্ষ কয়েকটা বিশ্ববিদ্যালয়ে পড়াশোনা করেছেন(হার্ভার্ড, শিকাগো ইউনিভার্সিটি, এমআইটি, কলাম্বিয়া ইউনিভার্সিটি,... বুঝতেই পারছেন)। তাদের ভারি একাডেমিক সিভি এই বইটা পৃথিবীব্যাপী বেস্টসেলার হওয়ার পেছনে বড় অবদান রেখেছে নিঃসন্দেহে। নাহলে এই বই মার্কেট পাইতো বলে মনে হয় না।
বইটার কিছু বিষয়বস্তু আছে যেগুলো অনেকের জন্যই প্রাসঙ্গিক না, অর্থাৎ অপ্রয়োজনীয় জ্ঞানের কমতি নাই। একথা বলছি কারণ নন-ফিকশন মূলত পড়া হয় দৈনন্দিন জীবনে কাজে লাগানোর জন্য। বিশ্বাস করেন, একজন খুচরা কোকেন বা ক্রিস্টাল মেথ ব্যবসায়ী কেন তার বাবা-মার সাথে বসবাস করে এইটা না জানলেও আপনার জীবনে কোন ক্ষতি-বৃদ্ধি হবে না। ঠিক ধরেছেন, ড্রাগ ডিলারদের জীবন নিয়ে একটা লম্বা রচনা লেখা আছে। না বললেই না, বেশিরভাগ রচনাই মাত্রাতিরিক্ত দীর্ঘ করা হয়েছে; একই কথা ঘুরায়ে পেচায়ে বারবার বলা হয়েছে। যেমন আমেরিকায় অ্যাবোরশন বৈধ হবার কারণে গত শতাব্দীর নব্বইয়ের দশক থেকে ক্রাইম রেট সিগনিফিকেন্টলি কমে যায়। কথা সত্য, কিন্তু এই কথাটা এতবার বলা হয়েছে যে, মনে হচ্ছিল শুধু অ্যাবোরশন হালাল করলেই বেশিরভাগ ক্রিমিনাল জন্মের আগেই নির্বংশ হয়ে যাবে।
বই থেকে একটা উদাহরণ বলি, কোল্ড ওয়ারের সময়কার ঘটনা, সমাজতান্ত্রিক রাষ্ট্র রোমানিয়ার চরম দুর্নীতিবাজ ডিক্টেটর নিকোলাই চসেস্কু অ্যাবোরশন নিষিদ্ধ করেছিল, তার উদ্দেশ্য রোমানিয়ার জনসংখ্যা বৃদ্ধি করা। অ্যাবোরশন নিষিদ্ধ হবার পর যে প্রজন্মের জন্ম হয়, সেই প্রজন্মের তীব্র আন্দোলন ডিক্টেটর চসেস্কুর পতনে ভূমিকা রাখে। অ্যাবোরশন বৈধ থাকলে ঔ আন্দোলনকারীদের অনেকের জন্মই হতো না। এই সরল যুক্তিটা আমার খুব কদর্য লেগেছে। এই যুক্তি দিলে ফরাসি বিপ্লব, বলশেভিক বিপ্লবেও অ্যাবোরশনের ভূমিকা টেনে আনা সম্ভব। চসেস্কু যেভাবে দেশ চালাচ্ছিল, অ্যাবোরশন যদি বৈধও থাকতো, তবুও তার পতন অবশ্যম্ভাবী ছিল।
লেখকদ্বয়ের আরেকটা যুক্তি, স্ট্যাটিসটিক্স দেখিয়ে ব্যাখ্যা করেছেন, গান(বন্দুক) কন্ট্রোল করে কোন লাভ নেই, বন্দুকের গুলিতে মৃত্যু ঘটার সম্ভাবনা থেকে সুইমিংপুলে ডুবে মরার সম্ভাবনা বেশি। সমাধান? অ্যাবোরশন। এটা বৈধ থাকলে ক্রিমিনাল ছেলের সংখ্যা হবে কম, গোলাগুলি এমনিতেই কম হবে।
বলছি রেগেমেগে গিয়ে অথবা মানসিক ভারসাম্য হারিয়ে ওদের দেশে গোলাগুলির ঘটনা তো নিয়মিতই ঘটে, কিছু মানুষ মারাও যায়। যাদের পরিবারের মানু��� নিহত হয়, তাদেরকে কি আপনি স্ট্যাটিসটিক্স দেখাবেন? বলবেন এরকম একটু আট্টু হতেই পারে, এরথেকে বেশি মানুষ সুইমিংপুলে ডুবে মরছে।
অ্যাবোরশন চালু থাকলে প্যারেন্টিংয়ের মান কেন তুলনামূলক ভালো হবে সেসব নিয়েও আলোচনা আছে বিস্তর।
যাইহোক, এই বইটা মূলত অ্যাবোরশন নিয়ে। এরসাথে আরও কয়টা বিষয় আছে, শিক্ষকরা কখন প্রতারণা করে সেটা নিয়ে একটা ইন্টারেস্টিং রচনা আছে, হোয়াইট সুপ্রিমেসি��্ট গ্রুপ কু ক্লাক্স ক্লানের কথা আছে, আমাদের পিএইচডিধারী লেখক যে খুব ব্রিলিয়ান্ট সেকথাও লেখা আছে, আর আর একটুখানি অর্থনীতিও আছে, যেমন ইন্টারনেট আমাদের অনেক তথ্য জানার সুযোগ করে দিয়েছে, অনেক পণ্যের মান ও মূল্য জানতে পারছি, তাই ইন্টারনেটের যুগে পণ্য কিনে ঠকবার সম্ভাবনা কমছে। এটা সম্ভবত সবাই জানে। এজন্য কোন Rouge Economist -এর লেখা বই পড়ার দরকার নাই।
অপ্রয়োজনে বইটা দীর্ঘ না করলে দুই তারা দিতাম। সময় নষ্ট করার জন্য এক তারা।
I’ve been hearing about this book since forever. I have mixed feelings.
On the one hand- it asks some very interesting questions and draws some very interesting inferences. It makes fascinating and, I think, important connections. The writers are also unpretentious and readable.
However.
I have some questions.
Question #1: The authors claim that “women’s rights advocates have hyped the incidence of sexual assault, claiming that one in three American women will in their lifetime be a victim of rape or attempted rape. The figure is more like one in eight- but the advocates know it would take a callous person to publicly dispute their claims.”
Oh, really? What are you basing this off of? Police reports? Surveys? How do you know?
See, I’m a woman. I’ve been sexually assaulted. Out of my, oh, 15 female friends, almost half have been sexually assaulted in some manner so far, and most of those female friends are upper-middle class (lower rates of sexual assault than working class women). If 1 in 3 were true, it would hardly surprise me; I wouldn’t even be surprised by a 1 in 2 estimate.
Now. How many of those friends have reported it to the police? None. How many would answer it honestly in an anonymous survey? I don’t know the answer, but I’m quite sure some would not.
So you see, I’m a little suspicious at the certainty with which they say “That's definitely wrong, it's 1 in 8."
I can see some wiggle room to say “This 1 in 3 claim has not yet been substantiated, as it is difficult to establish actual records on this sort of information; perhaps we should not be repeating this statistic so zealously.”
I don’t see any room to say “that’s wrong, it is 1 in 8, despite what these bleeding heart Bambi-saving women’s advocates would lead you to believe.”
Question #2 centers around the authors’ attempt to explain away those studies that show resumes with traditionally “black-sounding” names get significantly fewer interview requests than identical resumes with traditionally “white-sounding” names. They show some data demonstrating that names we think of as “black-sounding” are actually just names given by parents with low education; because black Americans tend to have poorer access to education, there are going to be more black DeShawns than white Deshawns, so we begin to call Deshawn a “black-sounding” name. A man named DeShawn is more likely to come from a lower-income background, therefore, and have less education. The authors say that’s really what makes employers less likely to request an interview from Deshawn than Jonathan.
I can for sure get on board with the possibility that someone named Deshawn is more likely to come from low-income/low-education background and is therefore less likely to do well in life for those reasons (of which his name is also a symptom, not a cause).
That said. Do I think employers associate DeShawn with a low-income/education background because they believe that’s what it denotes? Or do they think DeShawn sounds black?
Ask a random person on a street if they think a DeShawn is more likely to be a high-education black man or a low-education white man.
Think they'll say the former?
Yeah. I’ll take that bet.
That’s why I suspect the disparity in hiring practices with traditionally black or white names is due to race, not income/education. It doesn’t matter why people are more likely to name their child DeShawn, it matters at how the world views people as more likely to name their child DeShawn. I feel like this is a major, major point the authors miss in this section.
On the other hand, things I liked: That chapter on names was quite interesting for other reasons. It notes explicitly a trend I had sort of noticed in the back of my mind, just from interacting with the world and lots of people with names: names popular with high-education parents will, 10-20 years or so down the line, be almost exactly the names most popular with low-education parents. The high-education parents start the trendy names, and then low-education parents mimic them eventually (for example, Amber, Heather, Brittany, and Kayla were, in the 80s, very “high-end” names, used by high-education parents; now, they’re used predominantly by low-education parents; in the interim, they were “mainstream” names running somewhere in the middle).
It’s also especially interesting to read this book in 2017, a decade + after this book was written. The authors offer predictive lists of 2015’s most popular/mainstream names, based off high-end names of 2005, when the book was published. And damn they were accurate. They gave 24 names each of girls’ and boys’ names that they thought would be on 2015’s most popular list. For girls, for instance: Ava went from #9 to #4. Avery, 67 to 16. Eleanor, 264 to 60. Ella, 23 to 18. Emma, 2 to 1. Fiona 374 to 219. Maeve 694 to 450. Phoebe 425 to 287. Quinn, 683 to 97. You get the point.
Also, I found the causal link the author draws between abortion legalization as of Roe v. Wade and the unexpected drop in crime in the 1990s credible and compelling. While it definitely, if viewed normatively, has a bit of a eugenics vibe about it that uneases one, I think that, rather, it’s actually rather affirming, in light of how he puts it at the end of the chapter: What this link really demonstrates is that “when the government gives a woman to make her own decision about abortion, she generally does a good job of figuring out if she is in a position to raise the baby well.”