13 February 2010

16. Freakonomics

Freakonomics: A Rogue Economist Explores the Hidden Side of Everything - Steven D. Levitt and Stephen J. Dubner

An interesting book with "no unifying theme". It takes a look at some pretty unorthodox questions and searches for answers by analyzing avalable information. To really be able to do the things this author did you would have to have a thorough understanding of economics and a wide open space between your ears in which to rattle things around. To understand it after the auhor did the work does not require nearly as much brain-power

I really liked reading this stuff and looking at how they reached the conclusions stated within these pages. Some of it seems like common sense to me. Some of it is quite shocking.

An example: The subject being discussed at the time were the reasons for the decline in crime during the 1990s. All the experts had predicted a massive rise in crime being emminent. Some even expected the coming crime increase to be a "bloodbath". What did this book have to say?
     "As far as crime is concerned, it turns out that not all children are born equal. Not even close. Decades of studies have shown that a child born into an adverse family environment is far more likely than other children to become a criminal. And the millions of women most likely to have an abortion in the wake of Roe v. Wade---poor, unmarried, and teenage mothers for whom illegal abortions had been to expensive or too hard to get---were often models of adversity. They were the very women whose children, if born, would have been much more likely than average to become criminals. But because of Roe v. Wade, these children weren't being born. This powerful cause would have a drastic, distant effect: years later, just as these unborn children would have entered their criminal primes, the rate of crime began to plummet."

Another example: Here the book is discussing how sometimes it is hard to catch people cheating and sometimes it is easier. The example was being used to explain why some teachers found it socially acceptable to alter standardized test forms to improve the grades of their students. To prove a point about everyone cheating at some time or another, the following is entered as evidence.

     "Some cheating leaves barely a shadow of evidence. In other cases, the evidence is massive. Conside what happened one spring evening at midnight in 1987: seven million American children suddenly disappeared. The worst kidnapping wave in history? Hardly. It was the night of April 15, and the Internal Revenue Service had just changed a rule. Instead of merely listing each dependent child, tax filers were now required to provide a Social Security number for each child. Suddenly, seven million children---children who had existed only as phantom exemptions on the previous year's 1040 forms---vanished, representing about one in ten of all dependent children in the United States."

The book has chapters titled "What Do School Teachers and Sumo Wrestlers Have in Common?", "How is the Ku Klux Klan Like a Group of Real-Estate Agents?", and "Why do Drug Dealers Still Live With Their Moms?",
They are not joking around with some funny sounding titles. They really do ask these questions and search data looking for answers. That is why this book is so interesting. There are answers for these questions.

I even got to learn some pretty technical stuff. Things like Regression Analysis can be used to demonstrate a correlation between two variables, but it can not be used to prove that one variable is the cause of the other. What do I mean? I will use another quote to explain:
     "There are several ways in which two variables can be correlated. X can cause Y; Y can cause X; or it may be some other factor that is causing both X and Y. A regression analysis alone can't tell you whether it snows because it's cold, whether it's cold because it snows, or if the two just happen together."

This was a very interesting book that looks at things in some ways that I doubt most people could even dream of. The explanations are quite thorough and easy to understand. I may not like the conclusions reached in all these instances. I may think that I already knew the answer and they were just wasting paper. No matter what, it was still educational and enjoyable.

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