Superfreakonomics

So Steven Levitt and Stephen Dubner are back again with another helping of their peculiar brand of micro-economics. As far as the title goes, Superfreakonomics, they hardly score points for originality, but the book delivers exactly what the title promises.

{{ quote Levitt and Dubner extract some fascinating, shocking and at times disturbing results }}

It is a bigger, badder version of their hugely successful first book, Freakonomics. I remember reading their first offering back in the dark pre-history of AS levels. At that point I was slowly realising how mind-numbingly dull I found economics, a subject I’d wedded myself too for at least the next two years. I wish I could say that Freakonomics fired my imagination and my interest in supply and demand diagrams and Laffer curves, but unfortunately for me, and probably my grades, it didn’t. However I found the book enormously enjoyable of itself and the author’s way of taking some of our perceived wisdom and challenging it with hard economic data to prove that we shouldn’t be so sure of ourselves was certainly food for thought.

So with a fair degree of anticipation I cracked the spine of Superfreakonomics and delved in. One look at the chapter list and the reader realises he is in for a thought provoking read. Two of my favourite chapter titles that should illustrate this points are, ‘How is a street prostitute like a department store Santa?’ and ‘Why should suicide bombers buy life insurance?’.

At this point, as I read the chapter list, some innate scepticism crept in; these chapters sounded suspiciously like sensationalist statements designed to, well, sell a book. They are of course just this. But this need not be a reason to disregard the book. Yes, the chapter titles are sensationalist, but they are also interesting. If Levitt and Dubner apply economic theory and analysis to these issues and questions and come up with interesting conclusions then there is no reason to judge them for choosing topics that are likely to sell their book and, by and large, they manage to do just that.

One particularly impressive feat of data collection comes in their chapter on prostitution where an associate has interviewed 160 prostitutes working in three areas of Chicago over the course of nearly two years, logging as data more than 2,200 sexual transactions. Furthermore, the people used to collect this data are prostitutes or former prostitutes themselves, thus making the data more reliable as the subjects are less likely to lie.

From this data Levitt and Dubner extract some fascinating, shocking and at times disturbing results. I won’t give the game away by explaining any of the conclusions about prostitution in Chicago that they are able to draw, but the academic rigour shown here is typical of the book. In nearly every case study an effort has clearly gone into ensuring that data is as accurate and as widely drawn as possible.

Of course, as everyone knows there are lies, damn lies, and statistics so despite the academic rigour expressed perhaps we cannot always take the conclusions reached by Superfreakonomics at face value. To me one of the most demonstrative examples of this occurs in the introductory chapter in which our rogue economist asserts that it is safer to drink-drive than drink-walk. According to his data (which I do not deny is true), it is eight times safer to drink-drive than to drink-walk and even taking into accounts additional innocent casualties involved in drink-driving it is still five times more costly in terms of human life to drink-walk than drink-drive.

While the numbers and maths can’t be disagreed with, Levitt and Dubner manipulate the truth to a certain extent and the results can appear a little derived. It is, for example, the dangers of drink-walking or drink-driving per mile which the pair consider – clearly weighted to produce a certain answer. In the end Levitt and Dubner wittily suggest you should just call a cab when you’re drunk. Their contrarian and slightly manipulative assertion about drunk-walking is in fairness on the third page of the book, so perhaps it can be forgiven. Certainly the main body of the book, as far as I can tell, displays very little, if any, of this kind of data manipulation.

So as a whole, despite one black spot, the book is very good in terms of applying economic theory and data to challenge perceived wisdom about situations and issues. An important question that has to be asked though: can such economic theory be used with regards to social situations? Undoubtedly it can be. However it seems to me that, on its own, economic theory is only half the story. To truly understand the world around us, the kind of intensely logical fact-based analysis of Levitt and Dubner needs to be allied and mitigated by something that, for lack of a better word, we might call common sense.

Common sense would lead you to rebel at the assertion above about drink-walking and you would be right to do so – economic theory is a way of understanding many actions but it is much of the time only half the picture. Superfreakonomics provides a lens through which to look at some of the most interesting and news-worthy issues facing us today but it is only one way of looking at them and other ways may be equally relevant or important, perhaps even more so.

Superfreakonomics is without doubt one of the best page-turners I’ve picked up in a while. It skilfully combines an insightful look into issues people are really interested in with an undertone of amusing asides and thought provoking hypotheses. If nothing else, Superfreakonomics provides you with enough interesting facts to bore all of your friends senseless.