Book Review: Freakonomics

Freakonomics:  A Rogue Economist Explores the Hidden Side of Everything
By Steven D. Levitt and Stephen J. Dubner
Harper Collins, New York, 2005

The authors of Freakonomics, University of Chicago economist Steven D. Levitt and writer and journalist Stephen J. Dubner, admit it right up front: there is no unifying theme to this book.  Instead, Freakonomics is an anthology of unrelated research studies conducted by Levitt and, presumably, written up by Dubner.  The lack of any unifying theme or framework and the absence of any attempt to draw out broader patterns or conclusions make Freakonomics disappointing and unsatisfying.  After finishing the book, I couldn’t help asking, “So what?”

Some of the research described in the book  is controversial, even shocking, such as the apparent correlation Levitt found between the availability of legal abortions after Roe v. Wade in 1973 and the dramatic decline in violent crime in the US beginning in the early 1990’s.  Levitt postulates that millions of babies who would otherwise have grown up to commit violent crimes were simply not being born as a result of the legalization of abortion.  Other studies are less politically charged yet still quite fascinating.  A lot more people may be inclined to sell their homes privately after reading about how real estate agents tend not to get the best possible prices for their clients.   Still others are amusing, like the research into the occurrence of cheating among Japanese sumo wrestlers.  And finally, some are downright tedious, especially the study of names given by black and white parents to their children which takes up all of chapter 6.  

Taken as a whole, these inquiries have nothing in common, other than the use of fairly standard techniques of statistical analysis.  That Levitt arrives at unexpected, startling or unconventional conclusions through his thorough analysis of data is, in fact, neither unexpected, nor startling, nor unconventional.  Careful research often leads to counter-intuitive results.  What makes Levitt’s research a little different perhaps, and what makes Freakonomics an admittedly entertaining read, are the prosaic topics he explores.  Most of us have met or dealt with real estate agents.  Many of us, once in a while, succumb to the temptation not to drop a dollar into the office bagel fund.   This familiarity makes the research less intimidating.  It also helps that the writing is generally clear and complex topics are well-explained. 

There are some instances, however, where the research seems to contradict itself.  For example, within ten pages in chapter 5, about what makes the perfect parent, there seem to be two opposing conclusions about the impact of good and bad schools on students’ success.

Still, Freakonomics’ greatest flaw is the lack of any theme or framework.   The authors could have organized their material to illustrate various aspects of economic behavior that are not well-understood by the general public.  The book actually seems to head off in this direction.  Chapter 1, for example, describes a number of studies that all demonstrate how incentives powerfully motivate behavior in various fields, often in unexpected ways.  Chapter 2 revolves around what economists call the asymmetrical distribution of information; the idea that experts or insiders have access to more and better information than you do, and use it their advantage.  However, the remaining chapters do not follow this pattern. 

By contrast, Malcolm Gladwell organizes his disparate collection of observations into a coherent framework in The Tipping Point.  Nicholas Nassim Taleb’s Fooled by Randomness does a much better job of exploring how poorly people understand the influence of randomness in their lives, even though it is perhaps a more rambling and unstructured book.  

Freakonomics is interesting and mostly entertaining, but in the end, leaves the reader with a random collection of trivia: well-researched trivia, but trivia nonetheless. 

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