Freakonomics
Just finished reading Freakonomics a book from economics professor Steven D. Levitt (read profile of him by Dubner) and journalist Stephen J. Dubner. It educates readers how to question things in daily life we might easily accept as reality, mainstream opinions that media and so called “experts” are propagating. We have apparently a tendency to associate truth with what fits best to our personal comfort and interest. The famous economist John Kenneth Galbraith coined the term “conventional wisdom” for this type of truth which must not necessarily be untrue.
One main element of Levitt's questions is to go look for the incentive people have for their behaviors or actions. Then data and regression analysis is his way of demonstrating reality.
He comes up with really odd questions, e.g. “Why do drug dealers still stay with their moms?” Because they are earning only $3.30 an hour - less than the minimum wage. Only the leader of the gang did fairly well, making around $100,000 a year (tax free). Or “Where did all the criminals go?”, referring to the sudden and precipitous crime drop in the US in the 1990s. According to his analysis those criminals were not even born as he relates the crime reduction to legalization of abortion (which was very controversially discussed in the US).
I am going to let you read this book to learn more about the background on these topics. What I really enjoyed was the creative approach how to use the thinking you learn while studying economics in day to day settings to cross check facts with reality. It definitely encourages lateral thinking which I am convinced is the base of creativity. You find a little bit more insight into the contents of the book in this New York Times article. There is also the Freakonomics Blog or the Freakonomics webpage. And I recently discovered that Pavel read the book at the same time as I did but was quicker with his blog!
Posted at
08:16AM Nov 15, 2007
by Volker Seubert in Personal |
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