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Freakin’ Facts

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[Photo of Freakonomics book]You have GOT to be kidding! This would probably be your reply if someone told you there was a significant correlation between public school teachers and sumo wrestlers in Japan; or that the legalization of abortion caused the plunge in America’s crime rate back in the ‘90s.

Well, we all agree that some truths are deeply buried. But some truths are deeply buried beneath oft ignored piles of data. This is what Freakonomics is all about. It is written by American economist Steven D. Levitt, a recipient of the John Bates Clark Medal Award (given every two years to an accomplished American economist under 40) and Stephen J. Dubner, a writer at the New York Times and The New Yorker.

Freakonomics is a quick read. Mostly because it entertains as it teaches. The approach is so simple it can be understood by anyone who doesn’t have the faintest interest or inclination to learn the kind of economics being taught in universities.

Although the authors rejected the idea of having a unifying theme for the book, the topics tend to lean towards uncovering relationships between two objects, subjects, or topics that seem unrelated.

Who would have ever thought that real estate agents, dressed in crisp shirts and smart ties, have something in common with the hooded members of the feared Ku Klux Klan? Or that having a swimming pool in your backyard is far more dangerous than owning a gun? And even sundry questions that boggle the mind, such as “What was my mom thinking when she gave me a common name with an uncommon spelling?

The book offers astounding answers to these and other questions in a storybook manner. But although answers may appear as generalized truths, they come with the caveat that a reader mustn’t believe, but instead contest, conventional wisdom. For example, the authors propound the theory that America’s positive peace and order situation can be credited to abortionists.

Freakonomics is the nearest economics can get to socializing the social sciences. The book dares you to think for yourself and reject what is being forced on you by society. It helps you think freely, unrestrained by rules and formalities, gaining knowledge via the analysis of plain, uncolored facts, raw figures, and numbers.

If your brain freezes whenever you try to consider the principles of macro and microeconomics, price elasticity, and the law of diminishing marginal utilities, then consider what the authors say: The main thing about economics is people react to incentives.

In short, people tend to cheat or, at least, deviate from social standards when faced with a higher amount of incentives. This is illustrated in a chapter that shows how teachers—traditional models of truth and morality—cheat so their students can get better marks in standardized state exams. The authors compare them to sumo wrestlers—the repository of Japan’s religious, military, and historical emotion—arranging their games in order to win, and sometimes lose, a match.

So if you’re faced with a mind-bender, economic or not, try looking at things from a different, even screwy, angle. The solution to your problem may just be right around that crooked corner.

print ed: 02/08

 

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