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 the conventional wisdom on its head. Thus the new field of study contained in this audiobook: Freakonomics.
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 explore the hidden side of...well, everything. The inner working of a crack gang....The truth about real-estate agents....The secrets of the Klu Klux Klan.
What unites all these stories is a belief that the modern world is even more intriguing than we think. All it takes is a new way of looking, and Freakonomics will redefine the way we view the modern world.
©2006 Steven D. Levitt and Stephen J. Dubner; (P)2006 HarperCollins Publishers
"Refreshingly accessible and engrossing." (Publishers Weekly)
As a PhD statistician, I love a good data-driven story. Increasing, people in politics, business, and academia are looking for decisions that are based on what the data say. Leavitt's research is engaging and accessible and I, for the most part, enjoyed this book.
HOWEVER, without exception, Leavitt presents his findings as gospel and continually fails to acknowledge the limitations of his methods and his data. He mentions his use of linear regression to obtain his results, but fails to mention the limitations of this method (e.g., results are probabilistic, results are based on model assumptions which may be entirely incorrect). His results obtained from this method sometimes also appear to tell too convenient of a story and seem to be cherry-picked. Moreover, all his results are based on single data sets and may not be as universal as he would like. Finally, he often takes one result (e.g., reading to your kids does not affect their standardized test scores) and makes huge, sweeping generalizations that lead you to believe that reading to your kids doesn't have any affect on any outcome of interest and that you're a bad (or naive) parent for even trying.
These are dangerous practices, though I can see why he does what he does - making all sort of caveats would water-down his findings and make his book less sensational. Nevertheless, he runs the risk of misleading his readers. Judging from the comments posted here so far from people who assume these conclusions are certain, I would say he's succeeded in this endeavor.
Bottom line - I recommend this book. It is full of interesting threads comparing one part of life to another. The book tries to show how human behavior is governed less by morality than by economics. The reader/listener must be willing to accept that economics is more than the study of finances and as explained is understandable.
There are parts of this book that will disturb some listeners. The idea that crime reduction is primarily the result of Roe v. Wade is difficult for some to accept.
Other topics include parenting for childhood success in school, racial bias in baby names, real estate agents who sell out, teachers who cheat on tests, and the anatomy of drug dealing.
My biggest problem with the book is that it lacks a unifying theme. In fact, near the end the author admits to this and gives us little to tie it all together. It contains some very interesting concepts that I will listen to again. Perhaps then will I start to see their connections to each other.
One irony I cannot fault the author for is more Audible.com's fault. The author spends a good deal of time describing which parenting traits impact their child's academic performance and which do not. One argument he makes is that the amount of time a parent reads to their child does not affect that child's ability to do well in school. Whether or not you agree, the irony occurs at the end when Audible inserts an advertisement lauding the significance to a child's academic success as dependent on hearing others read books to them. I found this amusing.
This is a compelling book, but it will offend many. Race is dealt with quite a bit, and is pretty hard on blacks. We get mostly conclusions, and little of the data and methodology. Some conclusions are based on assumptions.
For example, they say that adoption correlates to lower success. If the data proves that, fine. But when they conclude that this must be because "The type of person to give up a baby for adoption tends to have a lower IQ"... I think this is an ASSUMPTION that can't possibly be supported by data, given that most adoptions are closed. How do they know the IQ of the mothers?
The idea that crime fell off precipitously in the 90's because of abortion is compelling but I see some flaws. They ASSUME that the unwanted, aborted babies were the most likely babies to have become criminals. At the same time they fall heavily on the nature side in the nature vs nurture debate (I agree) and imply that intelligent, successful parents tend to produce the same sort of children. So, who is really having all the abortions? Unintelligent and uneducated women, or upwardly mobile women that don't want impediments to careers and education? If the majority are in the latter group, couldn't it be argued that those kids would have been LESS likely to be criminals? Where is the data on this? I'm sure it's out there but not mentioned in the book. Also, what about all the aborted children that were essentially replaced by the children of immigrants? There has been no precipitous drop in population in America, unlike, say Italy, despite abortion and contraception because of immigration, correct? So, they must be saying that there's not a drop in teenagers, but just a drop in BAD teenagers, and I don;t see how this has been proven.
They sometimes cite hypothetical and anecdotal cases which are purely imaginary.
Despite these shortcomings, it was a fun read with interesting ideas. I just wouldn't take some of their conclusions as gospel.
First and foremost: this book has absolutely nothing to do with the economy. Nada. Zip. Zilch. This book, does, however, have everything to do with stepping back and looking at things from a different perspective.
As the summary says, this book covers a range of topics: realtors, drug dealers, school teachers, crime, etc. But the point is not so much to teach you something new about those topics, but instead to get you to look at how those topics have been presented to you by others. Then, to shift your perspective and think about them in another way.
This book isn't an education into the "what" or "who" or "where" or "how" that you generally see, but into the "why" of things. It shows that rarely can you take an explanation at face value, but instead you need to keep digging. Stopping at what seems to make sense isn't good enough -- you need to pick at it until you get to the true heart of the matter.
I would recommend this book to absolutely anyone, and have been.
Writer, Reader, Former Bookseller (RIP Borders)
Good for expanding one's point of view, and questioning conventional wisdom. Causes one to look at the motives behind the things we take for granted may not be as simply judged as first believed. Definitely worth the investment. I plan to buy the sequel. Narration is smooth and easy on the ears. Voice as enough inflection and personality to keep from being droll, but not so much that it is distracting or annoying.
I'm a lawyer and mediator. I represent businesses in disputes with their insurers and in other complex litigation. I also assist machinery companies and manufacturers (primarily international) with equipment sales, non-disclosure agreements, and business issues. I also mediate commercial disputes.
I had been meaning to read this book for a long time. It really makes some very fascinating connections and allows one to see the world in a different light.
One thing that bothered me is that the book rather uncritically suggests that my hometown of Atlanta was a hotbed of Klan activity. Although there was Klan activity in Atlanta and most of the South (and in other parts of the country), the book does not mention that Atlanta (birthplace of Dr. King) also boasts a long history of African-American entrepreneurship. Further, the City of Atlanta has had African-American mayors since the 1970s. At another point, the book suggests the crime rate here is very high. Yes, Atlanta has crime, but the City of Atlanta is a small part (about 500,000 people) of a 5.5 million metropolitan community. Crime stats focusing only on the City can be misleading.
These observations should not detract anyone from reading the book, but since the authors focus on discovering the truth about connections others do not make, I felt it important to make these points.
I have. The shifting ideas and stories become confused if you don't pay attention.
The fresh prospective and insights it brings.
A journey through the looking glass of economics, to view the world upside down, and thus see clearly. OR A fun filled wild intellectual ride in Mr. Toad’s car.
FREAKONOMICS, SUPER-FREAKONOMICS, & THINK LIKE A FREAK
Because the methodology used by Steven D. Levitt & Stephen J. Dubner in their books is almost identical, I have elected to review all 3 released books. Note: there is a 4th book, “When to Rob a Bank” to be released soon in May 2015.
IF YOU KNOW THE FREAKONOMICS SERIES AND THE WORK OF ITS AUTHORS SKIP THE NEXT THREE BIOGRAPHIC PARAGRAPHS; IF YOU DON’T KNOW AT LEAST ONE OF THEIR WORKS READ ON:
Paragraph 1: Steven D. Levitt is an economist working at the University of Chicago. As an economist he and Ph.D. John Donohue did some groundbreaking work in research & analyzing of drug gang financing. From that research Ph.D. Levitt noted that most street corner dealers often wind up living with their moms. It is only after they climb up the gang ranks that dealing in drugs become economically viable as self-support. Levitt and Donohue also preformed research that suggested that half of the decrease in crime in the 1990’s are due to the legalization of abortion by the 1973 decision Roe vs. Wade. The supposition and inference drawn from this study is that unwanted / unloved children are more likely to grow up feeling disrespected, with anger issues, prone to drug addiction, and having alienation toward authority that lead to criminal activity. These conclusions are based on a high probability inference drawn from statistical data that collected together indicate an association between (A) an unwanted child and (B) criminal activity as an adult. Does this method provide empirical mathematical proof that (A) will lead to (B)? . . . NO! Are there too many factors to draw such a direct relationship in ALL cases? . . YES! However, it is a better then even statistical gamble that the odds are better that if (A) occurs then, baring intervention during the growth years (B) will occur in at least half the set of all unwanted individual births. As I write this, I noticed that the Texas government and others are trying to restrict access to abortion which is projected to result in an estimated 30,000 unwanted pregnancies a year in Texas. Given Ph.D. Levitt’s hypothesis one might predict a crime wave breaking out in Texas in the next 20 years. It is an interesting social experiment to either validate or invalidate Ph.D. Levitt’s hypothesis.
Paragraph 2: Stephen J. Dubner is an award-winning author, journalist, and radio and TV personality, who partnered with Ph.D. Levitt, to co-author the 3 reviewed books that demystify the obscure meaning of academic nomenclature, statistical procedures, data analysis, regression analysis, and place it before the public in plain simple everyday language in an amusing informative story telling format.
Paragraph 3: In this dynamic dual Ph.D. Levitt brings the data crunching research; whereas Mr. Dubner brings the communication media savvy to reach the public. After the publication of Freakonomics in 2005 revised in 2006 Dubner and Levitt hired an editor (Melissa Lafsky) and started a blog to, “keep the conversation going”. In March 2008, Annika Mengisen replaced Lafsky as the blog editor. In 2009 Super-Freakonomics was published. In 2010, Marketplace radio created Freakonomics podcast hosted by Dubner and Levitt. It is available on iTunes and is aired bi-weekly on NPR and is on demand on the Freakonomics web site archive section. In 2011 the blog became independent from the New York Times. In 2014 Think like a Freak was published.
SO YOU SKIPED THE FIRST 3 PARAFRAPHS! Now let’s look at the individual books.
IF YOU HAVE READ / LISTENED TO FREAKONOMICS SKIP ON TO THE NEXT BOOK BELOW:
FREAKONOMICS, was first published in 2005 then Revised & Expanded in 2006; brings the power of academic data mining to big complex social and political issue presented in a user friendly story telling format. In using this format, the authors’ entertain and amuses the listener / reader while persuading the consumer to think outside the box and agree with these gee-wiz astounding conclusion or association. During these stories you are gently invited to abandon the safe comfortable boundaries of common wisdom, truth’s that do not solve problems, and group herd mentality, for a fresh approach. Typically, a chapter starts off with a grabber statement or question. The stories eventually get back to answering the question or center around illustrating the statement.
No matter what the subject, Freakonomics suggest that the tools of economics can be used to penetrate social chaos and make the unknowable, knowable through statistical analysis and identifying the incentives motivating these behaviors or maintain the status quo. The data when examined reveal multiple associations and parallels not seen at first glance and can lead to startling conclusions. The revised and expanded version did correct an error in the first addition and add some additional material. I enjoyed this book as a journey through the looking glass of economics, to view the world upside down, and thus see clearly. It is a fun read / listen, and intellectual ride. I recommend you jump on for a fun filled wild ride in Mr. Toad’s car. Normally boring economics has never been such fun.
Here is a list of other topics covered by chapter.
WHAT’S IN THE BOOK?
Chapter 1: Addresses two issues with one answer: Do teachers in Chicago schools cheat by changing student's answers on a standardized test and do sumo wrestlers cheat by throwing a match to help one another advance? The authors’ describe the perverse incentives that promote this undesired behavior of cheating. The answer to who cheats in general is just about anyone, if the stakes and incentives are right.
Chapter 2: Asks how is the Ku Klux Klan like a group of real-estate agents? The KKK is terrorist organization that controlled others through intimidation and violence. The influence of the KKK was diminished when opponents came into possession of their secrete information, handshakes, passwords, and operations, and exposed them through the media (radio, newspapers, & comics). The exposure of secret knowledge caused a decrease in Klan membership, although not its extinction. Several examples are then provided to show how access to information empowers consumers to get a lower price. The internet flattens the asymmetry of information between the expert and the public. White collar crime results when the expert exploits the information asymmetry to profit at public expense. Enron is the bad poster boy example of this. The author implies that realtors exploit their information asymmetry to manipulate buyers and sellers to the realtors gain and the client’s loss. I think this linkage in the grabber question is a bit of a reach. To compare a professional group regulated by law to a group of bigots, acting outside legal regulation or sanction is a step-to-far. In Super-Freakonomics the author’s compare realtors to pimps. Sorry guys this chapter is interesting but does not pass statistical muster. Secrete information of the Klan is not the same as asymmetric business information that is hard to get unless one is an expert or cares to do research on the internet. The element of time is totally ignored in the home sale examples. If realtor can wait extra time to get a better price it is because they can afford to do so. Buyers and sellers may not be affluent enough to wait for the best offer.
Chapter 3: Asks why do drug dealers still live with their mom’s? The chapter explores the economics of drug dealing, including how surprisingly low the earnings are and the abject working conditions of the crack cocaine dealer, who often wind up living with their mother. This is based on one’s of Ph.D. Levitt’s & Donohue’s premier research papers. The gang structure and the head of the gang described is an interesting case study in wasted talent. This chapter debunks the media idea that drug dealers are all rich; the data support that at the entry level they can’t even put a roof over their own head.
Chapter 4: Asks where have all the criminals gone? Romanian dictator Nicolae Ceauşescu among other draconian policies banned abortion in 1966. The policy was designed to increase the population. It worked; however, the unwanted children led miserable lives and they often turned to crime for support. The unhappy populist eventually revolted and poof no more dictator. The chapter then turns to Ph.D. Levitt’s research in Chicago. The study shows the role legalized abortion in America played in reducing violent crime 20 years after its legalization in 1973. The authors’ correlation of data suggests the increase in unwanted children contributed to Ceauşescu downfall and the decrease in unwanted children contributed to the decreased crime in Chicago. Texas is taking the Ceauşescu approach by restricting access to abortion. If unwanted children in Texas increase will crime spike in 20 years? Stay tuned for the outcome of this Texas experiment.
Chapter 5: Asks what makes a perfect parent? The authors found six parental factors that are positively correlated with a child’s academic success in school but more interesting they identified a number of factors that are commonly thought to be barriers to childhood educational success that had little or no correlation to actual academic success. The data suggests that children from economically advantaged black or white homes have a better chance of success than those from disadvantages black or white homes. No big surprise there captain obvious. However, if the better off black homes are in school districts surrounded by negative influence of social peer pressure to “stop acting white” it can hamper academic progress. This is not so obvious. This chapter also gets down into the weeds of defining economic terms like regression analysis or what a correlation is.
Chapter 6: Perfect parenting part two: The socioeconomic pattern of naming children. Do names commonly given black children carry an economic penalty? Do names made up to be different have an adverse effect? Does a child’s name have a minor or major influence on their lives? Does a rose by any other name still smell as sweet? Names cycle in and out of popularity. When a high end name becomes too popular they fall out of favor. The only thing this demonstrates is that parents select names they like or think will advantage their child. The data suggests that names do not correlate with actual success only signal the parent’s desire for prodigy success.
Chapter 7: The Epilog: This chapter reviews the previous chapters and summarizes them. There are some interesting anecdotal stories on how Ph.D. Levitt views the world as seen by his co-author in this biographical sketch.
IF YOU HAVE READ / LISTENED TO SUPER-FREAKONOMICS SKIP ON TO THE NEXT BOOK BELOW:
SUPER-FREAKONOMICS: The chapters in Super-Freakonomics begin with a grabber question or statement designed to catch the reader’s interest. The stories eventually get back to answering the question or center around illustrating the statement. This book continues its thesis that the tools of economics form lenses, through which one can identify incentives that create complex social and political problems. It then suggests that by reordering or manipulating these incentives, a problem can be resolved. They also warn that unintentional consequences can occur when incentives are manipulated or applied without giving careful consideration to their effect. The author’s then conclude that the world would be better off if we examined things scientifically and be data driven rather than reactively much like the JAWS phenomenon drove fear of shark attack out of proportion to the actual incidence of shark attack. All this is suggested through storytelling that is peculiar, ranging from charming to alarming to outrageous. If you are a realtor or some other group you may offended by the stories as they are sometimes fictitiously unfair to make a point. If there is an overall theme to this book I would describe it as the intercourse between the authors Levitt and Dubner fertilized by Al Gore in chapters 4 & 5 producing an environmental concern & exploring big environmental projects.
My overall impression of this book is that the scholarship is not quite up to par with the first book Freakonomics. It is one thing to poke fun at realtors; it is quite another to misrepresent a tenet of religion of a billion people to make your point. Early Christians were slandered when Romans represented the Eucharist as cannibalism of murdered children. In my opinion, the authors come close to having the same affect when they misrepresented Ramadan fasting in chapter two. See chapter 2 summary for details.
WHAT’S IN THE BOOK?
Chapter 1: This chapter opens with the question, “How is a street prostitute like a department-store Santa?" After a far too long exploration of the limits in women’s opportunities, incentives driving the disadvantaged to engage in prostitution and about six other twists and turns regarding perverse incentives, fallouts, and effects on society at various levels; it finally reaches the answer to the original question. That answer is that prostitute workers and Santa workers are in high demand during holidays, so they can charge a premium rates for their services. Having exhausted the economic incentives for prostitution at the low end of the economic spectrum, the authors revisit prostitution at the high end educated escort level in the composite person of Allie. Today, there are more opportunities for educated women then schoolteacher however wages for professional women lag their male counterpart. The escort Allie, rather than making a Sophie’s choice to enter the profession, chooses to do so for gain and is quite successful. She later exits the profession by way of real estate broker then college student. The authors make an unfair comparison between broker’s commission and a pimp’s percentage. OK this was weird but HAY SEX SELLS. As an opening gambit it is good merchandising; if insulting to realtors.
Chapter 2: This chapter is about patterns and details. It starts with the question "Why should suicide bombers buy life insurance?" Then it rambles on through two seemingly unrelated stories about, how the birth month favorably or adversely affects a child’s future prospect of health, wealth or success in life. [[[The example they cite is the Muslim tenet of faith called Ramadan fasting. The authors state that fasting during the month of Ramadan while pregnant adversely affect fetal development. What the author’s fail to mention is that there is a fasting EXCEPTION for PREGNANT or NURSING WOMEN. These women have the option to fast after the pregnancy or nursing ends or paying a penalty of feeding one poor person for each day of fasting missed. THIS LACK OF SCHOLORSHIP IS DISTURBING! It is sloppy work guys!]]] The chapter then transition to a discussion of reducing the cost of health care through the digitization of medical information, improving diagnosis as well as reducing cost. The chapter returns to why terrorist should by life insurance question. The answer is so they are not caught by a sophisticated computer algorithm designed to data mine bank records to identify terrorist from their pattern of banking activity. [The suggestion that terrorist buy life insurance so they don’t stand out statistically, resurface in the next book Think like a Freak] DID ANYONE SPOT THIS AS A RED HERRING?
Chapter 3: Contrast stories about apathy and altruism. For the apathy example they recount the brutal murder of Kitty Genovese in March 1964 while 38 apathetic people looked on, combined with a poor response time to the two who called the police. In the altruism example the authors’ at first suggest that the altruistic response can be increased through the application of game theory incentives only to concede that further refinement, by John List, that the data suggests altruism as economic behavior is closer to the initial assumption of rational self-interest. I found this chapter a bit muddy and statistically obtuse.
Chapter 4: Begins with the statement, “The fix is in! And it is cheap and simple.” What they should say is prudent cheap investment in change now, can reap big benefit later. The proof of this hypothesis is supported by the chapter’s six stories. (A) Hands washed with a chlorinated solution before assisting with child birth lowered the natal mortality from 10% to 1%. (B) The invention of forceps saved millions of babies’ lives by insuring they could be born head first. (C) In agriculture the invention and use of cheap fertilizer freed up the agrarian working population to labor in the industrial revolution. (D) The invention of a power steam drill enabled the discovery of petroleum and gas fuels saving whale from being hunted for their oil for lamp light. (E) The Salk polio vaccine enabled the reduction of polio almost to zero. (F) The mandatory adoption of the seat belt saved well over 250,000 lives. After citing examples A through F the authors’ then posit that similar benefit could be achieved by placing thousands of large floating plastic cylinders in the Atlantic Ocean so hurricane damage could greatly reduce. How you ask? The cylinders would displace warmer surface waters that feed hurricanes with cooler waters deeper down by-way-of the cylinders. Cooler surface temperatures result in fewer weaker hurricanes. The inventor, while admitting this technical deployment might be costly, says the cost of hurricane damage is 10 times higher than the cost of the solution they proffer. The complete absence of considering unintended consequence of this project is astounding. The logic of this paragraph is if A, B, C, D, E, & F are all true then proposal X must also be OK. The logic is non-sequitur. The subject of hurricane mitigation also transition into chapter 5 environmental Al Gore inspired goal of clement mitigation.
Chapter 5: Transition from a solution of hurricane mitigation to a global warming mitigation solution. Teaser question: “What do Al Gore and Mount Pinatubo have in common?” Al Gore advocates mitigation of global warming. The release of sulfur dioxide into the stratosphere might cool the planet down like sulfur gases from a volcanic eruptions do. Sulfur dioxide disbursed in the stratosphere would form a gaseous blanket reflecting the sun’s heat offsetting the greenhouse effect of our industrial age carbon emissions and reducing global warming. The same people that came up with the deployment of large floating plastic cylinders to mitigate hurricanes postulate releasing sulfur dioxide will do the same thing as volcano eruptions do. The author’s state because volcanos do it without harm the release must be safe. Brilliant and well worth the money if it works as theorized. This continues chapter 4’s theme of “The fix is in! And it is cheap and simple.” However, what if there are unintended consequences from this approach? There are no take backs in this game if you get it wrong. This is not a solution but a last ditch option if the world community cannot get its collective act together and reduce carbon emissions. At best this idea warrants more in-depth study in the lab.
The epilogue is about microeconomics, and discusses a study as to whether monkeys can be trained to use tokens as money. Surprise! They can. Unexpectedly, they also learn to steal the tokens and trade them for sex. Congratulations! While teaching monkeys an object can have value and can be traded for food you have also inspired theft and prostitution in the monkey society. This is a great lesson in unintended consequences.
THINK LIKE A FREAK: Is a sort of self-help guide to using some of the tools of economics discussed in the first two books. I call it lessons in thinking outside the box: Chapters begin with a grabber question / statement. The stories eventually get back to answering the question or illustrate the statement. This formula format can be found in all three books.
In this book the authors’ attempt to bring the macro world of BIG down to the individual listener’s or reader’s lever and implant the process for cutting up the unfathomable into easily SMALL and soluble size bites for their mind to ingest and grapple with. The unusual stories of this book are selected to mesmerize and engage the listener while giving them tools to bring issues within the individuals grasp. This book is far better than Super-Freakonomics because scholarship of the examples is better (Misrepresentation of Ramadan: GONE) and they engage in less offensive examples (Poking fun at Realtors: GONE). I like the book is better because of its self-help practical tool approach toward self-betterment. In chapter six of this book the authors admit they lay a trap for terrorist in chapter two of Super-Freakonomics. Although I applaud their goal of catching terrorist; I don’t think they did themselves any favor by displaying their ignorance of the exception for pregnant and nursing women to the practice of fasting during tenet of Ramadan. Nice try guys! However, if you look ignorant why should the would-be terrorist believe you, and fall prey to your trap? Are there any statistics to assess the effectiveness of your trap? Did you trap, like Nigerian scammers, only catch the dumb terrorist?
WHAT’S IN THE BOOK?
Chapter 1: The first lesson in thinking outside the box is embracing the power of admitting, “I don’t know”. To do so you must be insightful enough to discern when your knowledge is empirical fact based or based on shared opinion of your peers & families which you have accepted based on their credibility, likeability, or simply because the position itself appear attractive and we wish it to be true. These are beliefs you have absorbed from your faith or based in cultural norm. When you embrace the power of “I don’t know” you remove personal and cultural blinders that prevent you from seeing that there even is a problem or might be a problem. In other words, to think outside the box you must risk removing the comforting safeness of the box embracing and assuring walls. Heads up, thinking like a freak, can be unsettling or even a bit scary.
Chapter 2: OK, I’m outside the box, what next? The second step is to work hard and identify what is the root problem you wish to solve. In doing so you should reject artificial limits and methods of prior solutions because they have not worked. If we adopt prior methods we are condemned to the same old path others have trodden. To think like a freak is to find your own path. This second step sounds easy but it is incredibly difficult because it involves rigorous hard thinking and rejection of drifting along on common belief or knowledge. It involves looking beyond conventional wisdom and considering what is the real root of the proposed problem.
Chapter 3: Third step is to think like a child. Child! What age child? Why? In looking for proposed problem and root solutions the authors’ advise you embrace thinking like an inquisitive 8 year old child examining the world for the first time. No they don’t advise you to engage in magical thinking of childhood or playing Cowboys and Indians roles. Only that you look at things freshly and examine them, as if, before ones parents swoop in and explain patiently this is how it is kid; filling your head with cultural normalcy. If we accept these parental biases we stop thinking and reject before examination other possible explanations. The other critical thing in thinking like a child is once you have a new or original idea let it rest or ripen for a day, two, or longer. Not all new prospective ideas are viable after time and consideration. The intoxicating insights gained while unmoored to reality may not be all that great. It is only after some sober reflection that we can discern which gee-wiz idea is worthy of investing more time and energy to quantify, measure, and create a method to test whether it is true or illusory.
Chapter 4: The forth step in thinking like a freak is thinking SMALL. Big problems are often an aggregate of a whole lot of little ones. A big problem is often easier to label or use conventional wisdom to explain rather than actually open up the hood and look carefully to diagnose the problem. As a society we are much more prone to pouring a can of stop knock into the engine and keep on driving rather than look for the root cause of the knocking sound. We never stop to consider whether the internal combustion engine is the best way to get from point A to point B, or even if we need to go to point B. The other incentive in thinking SMALL is that small problems are simpler in nature and thus easier quantify and solve. Using this method of divide and conquer a single solution can be aggregated to other solutions and eventually even big problem go poof and fall to the onslaught army of small solutions. The other reason for thinking SMALL and tackling a small problem is its fun! The simplest problem we solve leads to a success and elevated self-esteem. The more small problems we solve the more likely we are going on to solve the occasional bigger problem. Again self-esteem goes up, endorphins kick into the brain, and “Shazam!” we find the process is fun. Being able to tap into our sense of fun is a primary motivator of childhood questioning and learning. If you want to think like a freak you must be able to have FUN while doing so. Fun is the primary viable reward for jumping outside the box and thinking like a freak.
Chapter 5: Ok, I’m out of the box, I don’t know anything, I am filled with 8 year old childlike inquisitiveness, and I am thinking SMALL; are we having FUN yet? The way you get to fun is step five; learning how to master the set incentive tools. To play the think like a freak game we must master the use of incentives tools. Incentives are what move you and others. The primary motivator in modern society is money. However, that is only because money is a measure of value that is easily transmuted into preferred incentive rewards like a favorite food, a snazzy new outfit, bigger and better set of wheels, or influence over others in gathering more emotional intangible incentives like respect, acclaim, status, or love. With the proper incentive one brings joy to others to encourage love. Money may not be able to buy love but it can certainly help grease the skids in the search to find it. Whether we can successfully motivate others behavior to change or not will depend greatly on whether we can successfully identify the incentive that motivates the individual best. Some incentives have more value than others and can differ in importance between individuals. Think of incentives as an option menu to choose from that is fitted to the individual diner’s mental and moral taste and preferences. This is not as easy as it looks, because your inducements to change are competing with other social herd mentality inducements to maintain in the status-quo. Societies by definition collect around common values that are resistant to change. Professional organizations do the same. Whether it is a society or a profession or a corporation, if it is based on a false premise it can do a lot of harm by frustrating a correct solution that run counter to established norm. Established norms that don’t work well may be temporarily serviceable. If we want to play the freak thinking game you must become good at figuring out which incentives actually motivate change and discard incentives that should motivate change but don’t. I called thinking like a freak, a game for a reason. In good game there is or are opponents. With opponents comes the ability for them to manipulate you through use of your incentives. The example cited in the book was the program incentive designed eliminate existing stockpiles of a particular air-conditioning coolant “bad for the environment” as the industry transition to a safer coolant; the incentive offered to destroy this “bad coolant” actually caused an increase in its production. Why? Because the incentive offered was too generous; it exceeded the cost of production of the “bad coolant”. So while some manufactures made alternative “good coolant” and sold it to the public, others continued to manufacture “bad coolant” and accept incentive payment to destroy it. The incentive created a catch 22 affect. Rater then use the incentive, as intended to ease a manufacturing transition, their greed turned it into a second source of income and expanded production to produce both coolants. Corporation’s primary incentive is to produce profits for shareholders. Moral incentives to do the right thing are often sacrificed to this goal. A good freak gamer must be aware of the play or your opponent will steal your incentive move and use it against you. Hay! This mastering of incentives moves is hard work! But what fun is there in a game of incentive moves if you cannot out think your opponent and use your incentive move better than they do? If outcome of games were certain, no one would play, and is not playing the primary way we reach the state of fun?
Chapter 6: Teach your garden to weed itself. This section is better titled how to get the bad guys to trap themselves. The chapter recommends justice through skillful manipulation of incentives. The opening example is how King Solomon determined which woman of two, who claimed the same baby, was false. The authors’ then moved on to Medieval times to suggesting that religious authority used the prospect of injury in at trial by ordeal to sort out truth and bring about confession and resolution of dispute between parishioners. Next they moved on to Nigerian scam artist who design their scam to sort out the gullible naïve target likely to pay off with additional effort, from the population too smart to fall for their trap. Finally, they updated us on an example from Super Freakonomics that involved sophisticated banking algorithm to identify the 500 or so terrorist in the UK. They admit that in that book they planted a RED HERRING false suggestion, that if the wood-be terrorist acted upon, would significantly improve the algorithm effectiveness at identifying the terrorist, and separating them from the innocent. These are examples of how the game of thinking like a freak can be played at a high level against some very bad opponents. My impression is that it would take a lot of practice to get to this level of play. I applaud the author’s efforts to aid in the game of terrorist trapping. Good luck guys.
Chapter 7: How to persuade the un-persuadable: This chapter is a toolbox of how to defuse those who would attack you, reach those who would not listen to you, and convince those who disagree with you to go along with your idea. I found this chapter to be the most useful. When we want to effect change in people whose minds are not open to it, the solution is in this approach. Tool one: Is to admit that your proposal may not be perfect and has a down side. By doing this you invite contribution not confrontation. Tool two: Acknowledge the strengths contained in your opponents argument. By doing this you signal reasonableness. Tool three: Is to keep the insults to your-self. Name calling will make an enemy out of your opponent and foreclose any future alliance. Tool four: The most effective way to persuade an opponent is through an anecdote or storytelling. A good story containing your position or argument and invites your opponent to see your point from a non-threatening way. Stories invite your opponent to identify with you through character and entertaining them just long enough to get your point(s) across. Illustrative stories make a stronger impression then a flat statement or rule. Stories not only convey the “what” of your position but illustrate the “who, when, where, and why” of your argument. If the opponent does not accept the “what” of your argument they may concede either the “who, when, where, or why” of the argument. When they accept a part of the argument you chip away and undermine their closed belief bias. Once that is accomplished we have a basis for dialog and perhaps compromise leading to agreement. That is the heart of persuasion. For a more in-depth examination of choosing the best persuasive technique get and read or listen to “The Righteous Mind” by Jonathan Haidt (emphasis on chapters 6 and 12). This book will help you understand opponents who think differently then you do.
Chapter 8: : Ok, I’m out of the box, I don’t know anything, I am filled with 8 year old childlike inquisitiveness, I am thinking SMALL, I am armed with the power of persuasion, and I weeded out stupid dead ends, however, I am still banging my head up against the wall and the problem has not fallen, what next? The last step is to recognize, “The up Side of Quitting. This is about having the detachment to make a strategic decision of when the sunk cost of a project has not advanced toward the goal so you make the decision to stop and cut your losses. When you play the think like a freak game you are not going to win every match nor best every opponent. This tool helps you decrease frustration and more productively to reallocate your time and energy elsewhere. If you stop banging your head against the wall that has not yielded to your solution; other options of solving other problems open up. The message here is stop and move on to greener pastures. That is the up side of quitting.
I listened to Freakonomics while driving to and from work. While I found it interesting, I didn't find myself engaged in the reading of the book or its content. Frankly, based on its rating, I expected more.
Looking at things from a different point of view is the definition of creativity, in that sense, the authors are true artists. A collection of disparate topics that somehow relate. An excellent book and very enjoyable to listen to.
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