King Rat (gkr) wrote,
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Freakonomics, Steven D. Levitt and Stephen J. Dubner

Freakonomics has been getting a lot of press, so I picked up the book by Steven Levitt and Stephen Dubner. The former is the new economics wünderkind; the latter is a journalist who once wrote a story on him. Later, Dubner was talked into being the co-author of the book because Levitt felt he wasn't much of a writer. Levitt wasn't, that is.

My overall impression of the book is that it's a lot like reading something by John Allen Paulos. Both of them seek to explain the everyday. The major difference is that Paulos doesn't have a problem with writing about something that isn't novel. His treatise on the stock market doesn't really break any new ground, whereas Freakonomics is getting the raves because of Levitt's groundbreaking work on the drop in crime during the 1990s.

The big topic in the book is Levitt's proposition that Norma McCorvey is responsible for the massive drop in crime during the 1990s. As you recall from your high school civics (unless you went to a religious school like I did), McCorvey is better known as Roe in Roe v. Wade. Now an anti-abortion crusader, in the early 1970s she was just a poor woman who wanted to have an abortion but could not because it was against the law. After she won her case, abortion was generally legal through the U.S. (with some restrictions allowed on 3rd trimester abortions and notification and whatnot). The bulk of those getting abortions are unmarried poor women. Their unwanted children are more likely to live a life of crime. 15 years later, starting in 1990, crime rates began dropping. While Levitt doesn't argue that it is solely responsible for the drop in crime, he has some pretty convincing evidence that this case was a major contributor to the drop. His evidence? Several states (Washington among them) legalized abortion a few years before Roe v. Wade forced them. Those states experienced the drop in crime a few years before everyone else. In addition, those states with higher abortion rates have seen a larger drop in crime.

An overview of the rest of his topcis:

  • Cheating in the modern world, with examples from sumo wrestling and teachers who cheat on standardized tests. In particular, he has some convincing arguments on who cheated and how they were found.
  • The value of expert information. In this chapter, he explores how real estate agents work against their own customers, how Superman reduced the membership of the Ku Klux Klan, and how the internet is helping to reduce prices by spreading expert information to the masses.
  • How dealing drugs doesn't tend to make most drug dealers much money, at least in the inner city, and how that's pretty similar to other highly sought after glamor jobs in Hollyywood.
  • Most parenting skills that parents obsess about doesn't really change much about the kids, with evidence provided in the form of test scores. I kind of wish he dealt with other statistics other than test scores, but the evidence that parents make kids smarter by their parenting skills seems slim, particularly in reading. He states, but doesn't provide the evidence except in an endnote, that peers have a much greater influence on childrens' education. And he touches on the relative risks of catastrophe, particularly comparing the danger to children of guns in the household vs. the danger of swimming pools (the pool is more dangerous).
  • And lastly, he has a chapter on how parents name their children. Of interest is how your name is probably indicative of your mother's socio-economic status, particularly if you are black. And also how names cycle from being popular among the well-off, copied by the middle and then lower class becoming less popular among the rich, and then eventually dropping off the radar of the lower classes as they copy new names from the rich.

Definitely a most interesting book. Paulos gets points for explaining more things, but Levitt gets the points for talking about some more surprising things.

Levitt, Steven D.
Freakonomics: a rogue economist explores the hidden side of everything / Steven D. Levitt and Stephen J Dubner.
207 p.
ISBN 0-06-073132-X
1. Economics—Psychological aspects.
2. Economics—Sociological aspects.
HB74.P8L479 2005
330—dc22
2004-065478

Tags: books, economics
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