Examples Of Freakonomics

In chapter 2 of Freakonomics the main argument is that the absence of information can be used for personal gain. The main example used to display this tactic is when the KKK is compared to real estate agents. Although the crafty practice of real estate agents is in no way similar to the horrors of the KKK, they have a distinct similarity when it comes to the hoarding of information. The majority of the chapter focuses on the history of the KKK and Stetson Kennedy’s effort to stop it through the infiltration and exposure via radio of the Klan. Since the Klan was dependant on their violent—despite not being extremely violent—reputation, the disclosure of the information they had withheld from the public rendered them powerless. The narrators

In what way are schoolteachers and sumo wrestlers similar? At first, this question might be puzzling, but the answer is provided in the book Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. Freakonomics is the result of a partnership between an award winning economist, Steven D. Levitt, and a journalist, Stephen J. Dubner. The duo decided upon making a book after Dubner was given an assignment to profile Levitt. Dubner realized that Levitt took a different approach to economics than other economists and he saw that Levitt had an interesting and effective way to explain statistics. This pushed the two to release the 315 page book to the public in 2005 in New York, New York. Since then, the book has flourished and has been republished numerous times. In Freakonomics, Dubner and Levitt reveal that fundamental ideas of economics can be used to interpret just about everything in modern society. The book focuses on a few key points including; incentives are the driving force behind everything, conventional wisdom is often wrong, small causes can often have dramatic effects, and the advantages of having information. The authors use many interesting stories and statistics to demonstrate these economic themes in the modern world. Stories include how some school teachers in the Chicago school system cheat, the influence that the legalization of abortions had on crime rates, and how real estate agents tend to sell their own homes for higher prices than if they

For this review I read Freakonomics written by Steven Levitt and Stephen Dubner. This book was published by William Morrow an Imprint of HarperCollins and is copyrighted 2005. Freakonomics is a unique book where there is no central story. It is not a story where it goes from point a to point b and follows a traditional storyline. This book is broken up into a collection of mini stories where the authors try explore issues and approach them from a non-conventional way of thinking. Some of these issues in the book include comparing Ku Klux Klan members to real estate agents, why drug dealers live with their moms, and linking abortion to criminal rates. The book addresses the issues at hand and uses data they have accrued and in their

Lastly, they explain the fundamental ideas of the book. Incentives are “means of urging people to do more of a good thing and less of a bad thing.”; according to the authors, they “are the cornerstone of modern life”. Levitt and Dubner also focus the book on the following concepts:

When explaining economics instead of using large over-complicated words, the authors simply state that “economics is, at root, the study of incentives.” Rather than utilizing economist argot, Levitt and Dubner describe economics in a way that makes it easier to understand and put into perspective. As the passage continues, the authors provide the audience with many relatable examples such as “if you break curfew you are grounded.” People respond to incentives, it’s the way our society works, “an incentive is simply a means of urging people to do more of a good thing and less of a bad thing.” Like Levitt and Dubner previously stated, economics is the study of incentives and how it affects society and their decision making

Incentives are a way to persuade someone, with a reward, that this is the right thing to do. A good example of this is if a high school student goes to but their first car, if the go with the hybrid model, than the government may off a tax return for getting an eco friendly vehicle. The author's ideas on black rhino conservation is a great example of this. The author believes that if the poachers stop killing rhinos for their horns, then the price of horns around the world will only go up. But in Africa jobs are very scarce, and legal jobs that can provide enough money to support a whole family are even more scarce. This is why people turn

People make decisions based on many factors. Even more, incentives are a large factor behind those decisions. Incentives can range from moral to economic. In 30 for 30: Playing For The Mob, it illustrates how incentives can persuade people into corruption. In this case, bribery is the focal point of corruption.

When I was young I always heard touching toads would give you warts. This was presumed not because people are superstitious or arrogant but because there wasn't any other logical explanation. Toads have a wart like texture so it made sense to hypothesize that's how you got them as well, and other people never questioned other peoples believes. This is an example of conventional wisdom and how it can often be misleading and inaccurate. Conventional wisdom is the ideas that people accept as factual regardless of how truthful that statement is.

Freakonomics is a book that focuses on our economy and why things change, prosper, and decline. In the text, the authors explore the effects that incentives and information have on the economy, the workplace, and people in general. For example, in the first chapter, the authors pose the question, “What do schoolteachers and sumo wrestlers have in common?” The average person would say that there is almost nothing in common between a schoolteacher and a sumo wrestler, but the authors of Freakonomics prove that statement to be wrong. They looked deeper and analyzed the biggest problems that each occupation has and noticed a huge similarity, cheating is a huge, often unnoticed problem in both, and they both have incentives that also go unnoticed quite often. Schoolteachers often cheat for their students on standardized tests. Their motive: they get raises and bonuses if their students do well, as it shows that they are being well taught. Sumo wrestlers often lose on purpose. Their motive can sometimes be bribes, but it is often that there

Human motivation is a physiological drive that we all have inside ourselves. There is no way to completely avoid it. Some drives we have are for basic necessities of survival, like the feelings of thirst and hunger. Obviously we must give into the drive that our body is signaling to us we must have because food and water are essential for us to live. When our behavior is directed by means of survival this is something known as homeostasis. “According to drive theory, the body maintains a condition of homeostasis, in which any particular system is in balance or equilibrium (C.L. Hull, 1951). Any departure from homeostasis, such as depletion of nutrients or a drop in temperature, produces an aroused condition, or drive, which impels the individual to engage in appropriate action such as eating, drinking, or seeking warmth. As the body’s need is met, the drive and associated arousal subside.” (Garrett, pg. 161)

As a human race, most people are after not the journey, but what they will receive when they’ve completed the hike. I found this quote on page 16 that states, "An incentive is a bullet, a lever, a key: an often tiny object with astonishing power to change a situation.". I found this relative to helping explain the book’s plot because your incentive to do well at your job is more pay, your incentive to lift weights is a better looking body, and an incentive to perform well in sports practices is more playing time when matches roll around. What some people would see as hard work finally paying off, others would see as incentives. This, is how I took the term ‘Freakonomics’ as stated in the

Previously said, the first chapter of Freakonomics best demonstrates the format of each chapter. Because of that fact, it is also the most effective in analyzing Levitt and Dubner’s central argument of that data holds the power to unveil new truths of the world. To start the argument on the similarities of teachers and sumo wrestlers, the authors, following their format, begin by establishing the foundation of this chapter: incentives. They describe incentives as “a means of urging people to do more of a good thing and less of a bad thing” (Dubner and Levitt 17). And using several examples including experiments on late fees in day cares and small stipends for blood donations, the authors ensure that the reader understands the full effect of incentives: they explain the differences between the three types of incentives, their applications in daily life, and the possible adverse effects of switching between two types of incentives despite any initial positive intentions. The authors

The authors describe an incentive as a means of urging people to do more of a good thing or less of a bad thing. In 1996 the Chicago Public School system embraced a new testing policy for their 400,000 plus

Humans respond well to incentives; Given the example in the book regarding real estate, it is shown that the agent has an incentive to obtain as much money for a possible sale as he or she can, but if the sale comes down to $10,000 below the asking price, it makes little to no difference to the agents commission. Therefore, they take advantage of the incentive to sell for the lower price to finish the sale due to the fact that the risk of loosing a sale is not worth the miniscule amount the agent would receive. Conversely, when real estate agents sell their own homes, they take the extra time and effort to get the extra $10,000 because they greatly benefit from it. This appears to be a balance of public and private interest because if an individual or family is selling their home, it is either to purposely upsize or to purposely downsize. If not, it is because the individual needs their money back in a timely fassion. Thus, it is beneficial for everyone if it sells quicker for a lesser amount because both parties benefit from the time saved.

This source cites may studies stating the monetary incentive have a negative impact on the stated goal. Kohn states that the best that can be expected is a temporary compliance to the desired outcome. Once the incentives were taken away the behavior returned to normal.