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Freakonomics – Book Report!

May 18, 2009 | 3 Minute Read


I was first introduced to Freakonomics in my grad school stats class. Part of the readings (don’t worry, we also had a textbook) included two chapters from the book. I liked the chapters and eventually subscribed to the Freakonomics blog (which sadly only has excerpted stories in its RSS feed). It’s been kind of overdue for me to finish reading the book. I finally checked it out from the library last month and finally had enough time (sick time) to finish it today.

There have been a lot of reviews on this book, so I don’t think I need to go there. I’d rather just give my reactions to it. Basically, after reading the book, and assuming the work that’s done in the book is in the realm of economics, I’d really like to become an economist. Seriously. Do economists just sit around at universities all day and think about interesting answers to difficult questions? I’m sure not all of them do. Maybe just a select few who are able to look at the world differently.

Maybe it’s a stretch to try and relate my own field of study to the book’s. Maybe not. In my former (I just graduated!) program, a lot of importance was given to contextual inquiry, incentive-centered design, user-centered design, etc. Basically, you can understand a problem better if you understand the context and the people who are experiencing it. I’m actually surprised that there wasn’t formal game theory introduced into the book, though they did touch on that with the example of how a real estate agent’s time would be much better spent trying to get rid of a house than work a little harder for a much smaller commission (volume versus quality).

I think that one of the overarching ideas of the book is that incentives drive the behavior of people. People cheat because it benefits them and they can get away with it. They don’t always do what’s best for them, though they might do what seems best given their situation. The world is much more complicated than a few variables in a regression analysis (though it’s still a pretty useful tool!). Also, correlation does not imply causation.

The book takes a strictly practical approach (“if morality represents an ideal world, then economics represents the actual world”), which is nice, if you can handle having some of your underlying beliefs questioned. In fact, I think the main thing I learned from the book is to really question “common knowledge” and “popular opinion,” because it almost always seems to be informed more than just fact.

I like that this book takes research (and a number of research methods like statistical analysis and surveys) and explains them in a intelligent and easy to understand way. It’s probably why my professor used it as part of the class readings (or maybe she just likes the book). It makes me yet again wish I had still applied for some PhD programs (though whenever I do, I again remember how crappy applying to grad school is and they sorta cancel out).

I wonder if this book will have the effect that in twenty years or so, people who read this book and encouraged their kids to become economists will cause a huge uptick in economics degrees…