May 30, 2005
Freakonomics
I just finished reading Freakonomics by Steven D. Levitt & Stephen J. Dubner, it's a scale-up of some articles in the New York Times Magazine (available from Freakonomics.com):
- The Economist of Odd Questions: Inside the Astonishingly Curious Mind of Steven D. Levitt,
by Stephen J. Dubner
New York Times Magazine, Aug. 3, 2003 - What the Bagel Man Saw: An Accidental Glimpse at Human Nature,
by Stephen J. Dubner and Steven D. Levitt
New York Times Magazine, June 6, 2004
The key insights behind the book:
- Understandig incentives is the key to understanding
the root cause of complex systems of behavior ("modern
life").
They assume that men are rational actors in their economic activity (not necessarily moral actors, as they may cheat, collude, or mislead, but rational). - The conventional wisdom is often wrong.
As my Uncle John used to say "It's generally accepted, so generally accepted it may not be true at all!" - Dramatic effects can have distant and subtle
causes.
This does not mean that the authors subscribe to the "Butterfly Effect" (meteorologist Edward Lorenz speculation that "flap of a butterfly’s wings in Brazil might set off a tornado in Texas"). They believe that clear cause and effect relationships hold. - Experts use their information advantage to serve their own ends.
- Knowing what to measure and how to measure it provides simple explanations for complicated situations.
- Hidden Order: The Economics of Everyday Life by David Friedman
- Moneyball by Michael Lewis
- Choice and Consequence by Thomas Schelling
- Micro Motives and Macro Behavior by Thomas Schelling
- Do Lunch or Be Lunch: The Power of Predictability in Creating Your Future by Howard Stevenson
- Bionomics by Michael Rothschild
