Lately, I have been working to improve my reading habits. Although I am an avid reader, I tend to read only technical books (programming, design, etc.) or fantasy novels. Although I certainly find value in reading these ‘genres’, I have made it a goal to branch out to other topics / fields in order to diversify myself a bit more and to learn more stuff. With that being said, I took the recommendation of Mike Neel to read the book Freakonomics
Basic Concept
In a nutshell, this book takes the thrilling subject of economics and applies them to the basic incentives and actions of different groups of people. Using gathered data and logic, the authors Steven Levitt and Stephen Dubner try to solve one of the most common questions that is asked: Why do people do what they do?
As it turns out, the books is primarily a book of cause and effect. According to the authors, everything in the world is based on incentives. If you want someone to do something / act in a certain way, give them an incentive to do so. If you want them to quit a behavior, offer them a counter-incentive that is greater than the incentive the is driving them to do that behavior. Conversely, actions that a group (or single person) perform often change the incentives that people are adhering to, often causing drastic reactions. As a way to prove this point, the authors visit a myriad of topics that range from why legalizing abortion caused a drastic reduction in crime, how charging daycare parents $$ when they fail to pick up their child may increase the number of late parents, and, my personal favorite, what sumo wrestlers have in common with teachers.
Of course, this concept is much more complex than applying common sense to a problem. Generally, common sense and conventional wisdom are horrible ways to try to create incentives. Due to this, intense research and data crunching are essential – as well as patience (in some cases, 10 years worth of patience). Simply put, we live in a very complex society and it is very difficult to predict even the basic behavior of one person, much less thousands. Also, relaying on conventional wisdom, the-tried-and-true way, and / or common sense is just another form of assumption. And, we all know about assumption….
The Good
First off, this book is written in a very clean style, which makes it a very easy read. Throughout the book, I was able to keep a very steady pace, thanks to the author’s wit and ability to convey fact in a very simple and clean fashion. Really, I spent most of the book being totally amazed as the authors describe amazing scenarios and then defining the cause of those scenarios as things that I would have never associated with the cause. The information was well presented and, IMHO, as accurate as possible. In fact, if you purchase the newer addition, the authors spend some time discussing their efforts of keeping the book data up to date w/ the current printing in the forward.
The Bad
Be prepared for shock factor overload. The book does a great job in presenting amazing facts and figures, but, eventually, you get a little numb to the effect. The overall lesson of the book never changes – Everyone reacts according to incentives. Consequently, the books tends to drive that point into the ground, but, at least, with some really good data!
I would liken reading this book straight through to reading the Guinness Book of World Records for an hour sitting. Eventually, you no longer care about the world’s longest measured turd – even if it is 12 feet 4 inches.
Final Thoughts
I would certainly call this an essential read for our times. In fact, this book has altered the way that I plan / perceive events because it introduced a new realm of possibilities of how to create incentives. I find applications for this book in just about every aspect of what I do, since everything we do usually involves a ‘human factor’ at some point.
If you are planning to read this book, I would recommend treating each chapter as if it were an essay rather than a chapter in a book. Take enough time to read the ‘essay’ in one sitting, and then take a break from the book for a while. This way the value of the book is enhanced but you don’t suffer from ‘shock overload’.
Have fun reading!
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