Book Review Freakonomics


Authors Steven D. Levitt and Stephen J. Dubner
2009
Publisher: Harper Perennial; Original edition
315 pages
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Hardcover, Paperback, Kindle and Audio CD editions

I remember studying Economics in college and being the only one in my class to earn an “A.” If you asked me how I did this, it wasn’t because of the text *Yawn* we were assigned to study. It was the instructor who made the material come alive.

Many economics books are remarkable cures for  insomnia. Most should be sold on late-night TV in blaring ads proclaiming the 40-wink results achieved just by opening the book and reading the first few pages.

Steven D. Levitt

Steven D. Levitt

But boring isn’t how Steven D. Levitt and Stephen J. Dubner approach their task. Levitt is the economist and Dubner the engaging writer. Together they have written a book filled with eye-opening Aha! moments for the casual reader. What they have done is asked the right questions and then made interesting connections subscribing not to the Theory of Why Things Are, but The Way Things Really Should Be.

Stephen J. Dubner

Stephen J. Dubner

 

Crime Pays…sorta
For example, the authors trace a drop in violent crime rates in a poverty-stricken area of Chicago due not to increased police presence and more efficient methods, but to Roe vrs Wade. The 1973 Supreme Court decision on women’s rights to have abortions, eliminated a great deal of the population growing up in poverty. Fewer births meant fewer criminals born and raised in an environment presenting gang lifestyle as an attractive alternative to welfare.

But just when you think that Levitt and Dubner have struck upon one area where crime pays, they present a study of a inner city gang structure, kind of like Crack LLP. In this, top leaders earn the bulk of drug sale profits. Lower-ranking soldiers and dealers sell product at great personal risk, while barely making minimum wage. Sometimes less. That’s why some drug dealers still live with their mommies.

Parents, be afraid
As for moms and dads concerned with child-rearing environments, the authors argue that parenting methods are far less important since backyard swimming pools are much more dangerous to toddlers’ health than guns.

Why I liked this book
I liked that the authors aren’t afraid to take on conventional thought, the so-called expert wisdom about the stock market, investing and business cycles, daily spouted by economic experts and business show pundits. They suggest that these self-styled experts are more concerned with talk show appearances and tenure, rather than figuring out how the world really works, even when they know that what they profess is wrong

Underlying all these research subjects is the authors’ belief that complex phenomena can be understood if we find the right perspective. This is where the authors have missed the mark. They allow cited research material to take center stage, instead of summarizing.

A recommended read for the small business owner
I liked Dubner’s writing style and his engaging way of communicating eye-opening awakenings to conventionally dull subjects. Levitt draws some very interesting conclusions and is not fenced in by career choice. A good read for the small business owner who wants to learn how to look at the world’s real economic problems from a vastly different perspective, and apply some of these to his or her small business world.

Highly recommended.