This collaboration between a rogue economist, Levitt, and an award winning journalist, Dubner, has produced a book that will make you think about things in a different way. They show (per the inside front flap) that “… economics is, at root, the study of incentives—how people get what they want, or need, especially when other people want or need the same thing”. But “There’s nothing like the sheer power of numbers to scrub away layers of confusion and contradiction.” And they believe that “no subject, however offbeat, need be beyond the reach of the science of economics.”

Levitt is apparently what some would call a nerd, someone who has an interest in sifting through and teasing out otherwise unknown nuggets of information from mountains of data. For a nerd, he is apparently fearless, however, for he seems not to be concerned upon whose toes he treads with his findings. He asserts that “Morality represents the way people would like the world to work—whereas economics represents how it does work,” and “Incentives are the cornerstone of modern life. And understanding them—or often ferreting them out—is the key to solving just about any riddle, from violent crime to sports cheating to online dating.” He believes that conventional wisdom is often wrong and dramatic effects often have distant, even subtle, causes.

He asks and answers questions like:

Which is more dangerous, a gun or a swimming pool?

Would a real estate agent hold out for more money selling her own house than when selling yours?

Would schoolteachers cheat when administering exams to students?

Would Japanese Sumo wrestlers fix their matches in their most honored sport?

Why do (most) drug dealers live with their moms?

How much do parents really matter?

What was the real cause of the major reduction in crime statistics across the country during the 1990s?

Does money buy elections?

What is the real cost of campaign finance?

What are the reasons an honor system sometimes works and sometimes doesn’t?

What happened to the seven million children who disappeared from the United States in April of 1987?

The authors claim to have no central theme for the book, yet one can detect a common thread: there is a knowledge gap between the public and the “experts” and in far too many cases, the “experts” use their informational advantage to serve their own agenda. I think the power of this book, however, is the ability of the authors to relate what would normally be a boring process of data analysis into an intensely exciting story as they reveal their exploration tactics and progression through the mystery to a solution that many are unwilling or are afraid to contemplate.   

Probably the most controversial issues discussed are the findings concerning the almost precipitous drop in crime that occurred in the 1990s. The dramatic turnaround from the growing menace of the crime wave of the 1970s and 1980s was “explained” by a number of mostly big city mayors (think Gulliani, etc.) touting such influences as better policing, more police, cocaine market collapse, aging population, etc.

Levitt “normalized” all these factors (organized the data to isolate the influence of each) and concluded that only in the case of cities where extra police were added in direct response to crime did any of the touted factors have a substantial impact. What did have an overwhelming impact was something that had happened over twenty years earlier: Roe v. Wade.

Unwanted, unloved children tend to be neglected and abused. Study after study has shown that children born into this type of environment are disproportionately predisposed to retaliate against society for their pain and become criminals. Across the country, after Roe was decided, young, poor single women suddenly found an avenue to avoid having unwanted babies and for whatever reason, took advantage of the opportunity to terminate their pregnancies. As a result, children were not born who as a group would have tended to provide a substantial portion of the criminal population fifteen or twenty years or so later and would continue the trend from there. So the crime wave collapsed in the 1990s for want of perpetrators.

One can imagine the uproar that publication of this finding caused among certain moralists in the country. However, the authors have examined all contrary claims and in their supplemental material in this updated version of the book show how their conclusion, rather than being weakened by these attacks, is bolstered by the data purporting to contradict their finding.

This is an interesting book. It will make you aware of the asymmetry of information between “normal” folks and “experts” and will make you glad you now have the World Wide Web as a tool to check out the way things are, as opposed to the way some of the “experts” say they are.

I highly recommend this book for its utility and reading pleasure. My only complaint is that it seems chopped up, almost a book of short stories, due, I suppose, to the lack of a unifying theme. But, then, the authors told me that when I began reading it, so I suppose I have no complaint. The common thread of exposing the agendas of particular selfish “experts” will have to do. 
 

 
© 2007 R. Leland Waldrip