Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven Levitt & Stephen Dubner

 

Memorable quotes

“The conventional wisdom is often wrong.”

“An incentive is a bullet, a key: an often tiny object with astonishing power to change a situation”

…Feldman’s presence had deterred theft. Not only that, but those bagel eaters knew the provider and had feelings (presumably good ones) about him. A broad swath of psychological and economic research has shown that people will pay different amounts for the same item depending on who is providing it.

Economic and social behaviors, Galbraith continued, “are complex, and to comprehend their character is mentally tiring. Therefore we adhere, as though to a raft, to those ideas which represent our understanding.”

Consider the police. A recent audit discovered that the police in Atlanta were radically underreporting crime since the early 1990s. The practice apparently began when Atlanta was working to land the 1996 Olympics. The city needed to shed its violent image, and fast. So each year thousands of crime reports were either downgraded from violent to nonviolent or simply thrown away.

It shouldn’t be surprising to learn that elderly people are not very criminally intent; the average sixty-five-year-old is about one-fiftieth as likely to be arrested as the average teenager.

These two factors—childhood poverty and a single-parent household—are among the strongest predictors that a child will have a criminal future. Growing up in a single-parent home roughly doubles a child’s propensity to commit crime.

In the early 1990s, just as the first cohort of children born after Roe v. Wade was hitting its late teen years—the years during which young men enter their criminal prime—the rate of crime began to fall. What this cohort was missing, of course, were the children who stood the greatest chance of becoming criminals. And the crime rate continued to fall as an entire generation came of age minus the children whose mothers had not wanted to bring a child into the world. Legalized abortion led to less unwantedness; unwantedness leads to high crime; legalized abortion, therefore, led to less crime.

“If you both own a gun and a swimming pool in your backyard, the swimming pool is about 100 times more likely to kill a child than the gun is.”

…according to the data, their choice isn’t smart at all. In a given year, there is one drowning of a child for every 11,000 residential pools in the United States. (In a country with 6 million pools, this means that roughly 550 children under the age of ten drown each year.) Meanwhile, there is 1 child killed by a gun for every 1 million-plus guns. (In a country with an estimated 200 million guns, this means that roughly 175 children under ten die each year from guns.) The likelihood of death by pool (1 in 11,000) versus death by gun (1 in 1 million-plus) isn’t even close: Molly is far more likely to die in a swimming accident at Imani’s house than in gunplay at Amy’s.

So if nature accounts for half of a child’s destiny, what accounts for the other half? Surely it must be the nurturing—the Baby Mozart tapes, the church sermons, the museum trips, the French lessons, the bargaining and hugging and quarreling and punishing that, in toto, constitute the act of parenting. But how then to explain another famous study, the Colorado Adoption Project, which followed the lives of 245 babies put up for adoption and found virtually no correlation between the child’s personality traits and those of his adopted parents? Or the other studies showing that a child’s character wasn’t much affected whether or not he was sent to day care, whether he had one parent or two, whether his mother worked or didn’t, whether he had two mommies or two daddies or one of each?

“Patients in traditional forms of psychotherapy while away their fifty minutes reliving childhood conflicts and learning to blame their unhappiness on how their parents treated them,” Pinker wrote. “Many biographies scavenge through the subject’s childhood for the roots of the grown-up’s tragedies and triumphs. ‘Parenting experts’ make women feel like ogres if they slip out of the house to work or skip a reading of Goodnight Moon. All these deeply held beliefs will have to be rethought.”

There is a strong correlation—a negative one—between adoption and school test scores. Why? Studies have shown that a child’s academic abilities are far more influenced by the IQs of his biological parents than the IQs of his adoptive parents, and mothers who offer up their children for adoption tend to have significantly lower IQs than the people who are doing the adopting.

A DeShawn is more likely to have been handicapped by a low-income, low-education, single-parent background. His name is an indicator—not a cause—of his outcome.

And what if DeShawn had changed his name to Jake or Connor: would his situation improve? Here’s a guess: anybody who bothers to change his name in the name of economic success is—like the high-school freshmen in Chicago who entered the school-choice lottery—at least highly motivated, and motivation is probably a stronger indicator of success than, well, a name.

“As long as poll-voting was the only option, there was an incentive (or pressure) to go to the polls only to be seen handing in the vote. The motivation could be hope for social esteem, benefits from being perceived as a cooperator or just the avoidance of informal sanctions. Since in small communities, people know each other better and gossip about who fulfills civic duties and who doesn’t, the benefits of norm adherence were particularly high in this type of community.”

A few years later, however, with Congress clamoring for more tax revenue, Szilagyi’s idea was dug up, rushed forward and put into law for tax year 1986. When the returns started coming in the following April, Szilagyi recalls, he and his bosses were shocked: seven million dependents had suddenly vanished from the tax rolls, some incalculable combination of real pets and phantom children. Szilagyi’s clever twist generated nearly $3 billion in revenues in a single year.