Book Review: Freakonomics [8.7 out of 10]

Freakonomics : A Rogue Economist Explores the Hidden Side of EverythingA classic in its kind. A book on the kind of economics that can only truly be described as Freakonomics. Intelligently written by Stephen J. Dubner, it is the story of the many riddles that Steven D. Levitt’s brain has been struggling to answer for the past couple of years.

Authors: Steven D. Levitt & Stephen J. Dubner
Year: 2005
Number of Pages: 207 pages (+ Suppl. Notes)
Publishers: HarperCollins Publishers Inc.

I had just finished reading Freakonomics, and, already, I wanted more. The nonchalant writing style Dubner has in this book, and the way he tells the stories of Levitt’s numbers and studies simply makes you want to have more. It makes you want to study economics, but most of all, it gives you a whole new perspective on some of today’s problems in society. The main thing that fascinated me was the way the book was written. The surprising titles, and the even more surprising links between subject you would never have though had connections. What they have called Freakonomics. The book is filled with striking examples of the authors’ creative use of economic theory. They have also included at the beginning of each chapters in the book a glimpse of Levitt’s life, which usually links the idea of the chapters. Here are a couple of quotes from the book, which I hope you enjoy and makes you want to read it even more:

Interesting Quotes From the Book:

This first quote was taken from the Explanatory Note at the beginning of the book and sort of gives brief overview of Levitt’s personality:

Steven Levitt tends to see things differently than the average person. Differently, too, than the average economist. This is either a wonderful trait or a troubling one, depending on how you feel about economists. (The New York Times Magazine, August 3, 2003)

The following quote comes from the chapter where Levitt and Dubner discuss how expert’s do not always work for us, and tend to make money out of our ignorance. Economists calls this Information Assymetry.

It is one to muse about experts’ abusing their position and another to prove it. The best way to do so would be to measure how an expert treats you versus how he performs the same service for himself. Unfortunatly a surgeon doesn’t operate on himself. Nor is his medical file a matter of public record; neithr is an auto mechanic’s repair log for his own car.

Real-estates sales, however, are a matter of public record. And real-estate agents often do sell their own homes. A recent set of data covering the sale of nearly 100,00 houses in suburban Chicago shows that more than 3,000 of those houses were owned by the agents themselves. (Freakonomics, p.8)

This last quote is a beautiful definition of what Economics truly is.

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. Economists love incentives. They love to dream them up and enact them, study them and tinker with them. (Freakonomics, p.20)

In Conclusion

Well, overall, I really enjoyed this book. I would definitively buy and read a sequel. Levitt/Dubner, if your reading this, note to self: "Write a sequel to Freakonomics for Miguel and Bonnie". BUT. Yes, there is a but. At times I felt like I was given an overly basic explanation of what was really going on, and that some of their examples were a little flimsy, which made me feel like there were holes in their theories. Don’t get me wrong. I still gave it a 8.7 out of 10. Not bad at all for a book on a topic I hated as a teenager!