SuperFreakonomics Analysis

Summer 2010

Dr Marc Turetzky

Superfreakonomics: Good Principles That May Apply to Policy
Steven Levitt and Stephen Dubner’s Superfreakonomics is a great follow-up book to Freakonomics in that it is successful in being able to examine every day phenomenon and look at them through the lens of economics. Levitt and Dubner go through different cases and examples to explain human behavior, make decisions about policy, and come up with interesting conclusions. Their conclusions may be fun to read about, but may not always apply well to political policy or even choices made by individuals every day in their daily lives. However, some of the underlying reasons to search for answers, looking at data, seeing at cause and effect, and other factors at the heart of Superfreakonomics should be used and considered when thinking of making effective political policy.

Summary
Superfreakanomics is set up in chapters of short vignettes that explore different topics ranging from illegal industries, such as prostitution to debunking taken for granted assumptions and examples, such as the safety behind using car seats and the altruistic nature of humans. Each chapter provides multiple stories, background, data, and commentary on how this system is flawed, could be improved, or related to larger issues in the world, such as fighting terrorism. In the introduction, Levitt and Dubner talk about seeing the world through the eyes of the economist and include being a woman in India and the transition of horses to cars, as well as talking about statistics and the bending of knowledge. This introduction shows that every day events can be interesting and can be a starting point of discussion (17).

The first question is about how prostitutes are like departmental-store Santa Clause’s due to supply and demand. Prostitutes do seasonal part-time work and can make a lot of money to pay bills, as opposed to working two jobs, due to the fact that the work is illegal and customers are willing to pay. In addition to supply and demand to make ends meet, the drive for prostitution is also related to differences in how much money a woman earns versus a man (21). A woman is willing to be a prostitute, since she is able to make more money per hour. With relations to economics, prostitutes do cost-benefit analysis when it comes to having a pimp, just like other people do with real estate agents (38). Both prostitutes and people who want to sell their homes decide that it is better to provide money to someone else for a better overall outcome.

Secondly, Levitt and Dubner attempt to work backwards from baby health outcomes, hospital doctor ratings and treatment, and profiling terrorists. By working backwards, Levitt and Dubner are looking for ways to change the current situation by small changes, such as integrating information at the emergency room of the hospital and using computer programs to look for trends in health symptoms and also if that applies to policies that can be used to protect the United States.

Economics is also connected to the human psyche with human motivations, altruism, and apathy using the main example of Kitty Genovese showing that things are always more complicated than they seem (97). In relation to economics is whether or not monetary incentives should be used to supply kidneys and politics with ways to figure out how to maximize policies’ effectiveness by making people feel like they get a benefit. In this section, there are many psychological experiences that break down assumptions that people do the right thing. People will do the right there unless there are different incentives, such as money and peer pressure that get in the way.

One of the most applicable chapters is “The fix is in – and it’s cheap and simple.” Everyone wants quick and simple fixes to complicated issues like mysterious maternal deaths, seat belts, polio, and preventing hurricanes. Instead of picking the most expensive and complicated answers, Levitt and Dubner ask that people pick preventative ways, such as washing hands and taking vaccinations to prevent the spread of disease, other public health measures, and moving ocean water to prevent hurricanes.

Connected to controlling ocean water to influence hurricanes is global warming. Global warming also needs solutions. However, with global warming, there is concern about the problem itself and what is possible. There is also the issue of externalities. While mostly companies and cows produce the emissions, the global warming problem is inherited by everyone. Everyone has to deal with increased temperatures, dying polar bears, and unusual weather patterns. Who has the power to limit emissions? Who is going to put up the money? Just like previous issues, the simplest and most cost effective solution may not be considered, due to its questioned effectiveness. In this case, it involves sulfur emissions in the upper stratosphere or changing architecture to shoot emissions to a different level. Instead of changing people’s behavior, such as not driving cars while drunk or washing hands in the hospital, it may be easier to change other things such as the environment or changing the externalities (207). Just like previous sections, this section argues about the economic basis of costs and benefits involved in making decisions, such as choosing what to do about global warming.

In their conclusion, Levitt and Dubner leave the reader thinking with a story about monkeys taught to use money. Monkeys are taught to use money by associating coins with receiving food. After learning to use money, the monkeys realize its value and start to steal money and exchange money for sexual activity (215). In addition, money use is also related to unraveling to human behavior. Based on this research, Levitt and Dubner pose the question if money is able to start theft and prostitution, could money cause many other problems as well.

Analysis
I feel that Levitt and Dubner took a good approach to their research questions, since they created a hypothesis and looked through the literature for statistics and evidence. I think the question posing process is part of research, since they were asking questions that no one else was asking. Asking new questions provided additional insight on issues like why women turn to prostitution and how safe are seat belts. This helps to have more motives and complete story instead of just one perspective.

Levitt and Dubner use an approach of looking at smaller isolated cases and attempt to use these to make conclusions about larger trends. Using many small studies can be effective in showing that economics does not have boundaries and can be found everywhere from prostitutes, suicide bombers, psychology, and in other animals. They also only look at only a few people in each chosen field, such as only looking at prostitution in one city, Chicago (32). It can be hard to use Chicago to make conclusions about prostitutes in Las Vegas or other areas. Because of this, Levitt and Dubner are under fire, especially when it comes to global warming. Because of the small sample size, it is hard to determine if it is really cause and effect or if it is just a correlation. This makes it difficult to make conclusions that may apply to larger groups, which is what is relevant for making decisions about policy change.

I am not completely convinced that all the answers are the
right ones. The questions are great, but I would love to see evidence from other solutions or perspectives on the same problems. By neglecting to see the whole picture, they may be seen as biased. Instead of using p-values and data charts, a lot of this data is anecdotal and specific to a particular situation. This can allow for more data manipulation to match a theory.

Levitt and Dubner’s contrarian positions, or position that goes against the mainstream, makes for interesting reading, and does provide some insight to consider when making public policy, but other than a reminder to look at alternative answers and to strongly consider simple solutions over complex ones, it is hard to take all the statistics as face value facts, when so much of the story is left untold. Sections that would have benefitted from additional information include money usage in other animals besides chimps, alternative causes of global warming, and other causes of crime besides television. Levitt and Dubner provided the other side of the story for Kitty Genovese and altruism, but I felt that was appropriate considered how common the original story was.

I believe that Levitt and Dubner over-simplify many arguments for the sake of keeping the book short and entertaining. I am not the only one who thinks so, but is shared by many critics of Superfreakonomics. Instead of going through many studies which would give a more gray picture of “sometimes, this is true, but sometimes, it’s not,” Levitt and Dubner focus on only a few studies to strengthen and simplify their argument. It is much easier to convince someone if no alternative evidence is presented. A specific over-simplification would come from the assumptions. This was documented by the assumptions over walking drunk vs. driving drunk as Ezra Klein argues in “The Shoddy Statistics of Freakonomics.” Klein argues that assuming that one was equally likely to choose walking and driving and that both drunk walkers and drunk drivers are equally drunk construes the results. I agree with Klein that there are many other factors, such as what one was drinking, the time of the year, and where one is. Driving drunk is more problematic in urban areas than walking drunk. In fact, walking drunk might be safer because others may see the drunk individual and help him or her out.

The most controversial chapter was on global warming, where Levitt and Dubner were attacked on multiple angles, by economists, scientists, and bloggers. First, they were criticized for incorrectly quoting scientist. They were also criticized for making conclusions about a complicated field that they had little knowledge about (Plumer). Dubner even responds to the accusations saying that he and Levitt did not misquote scientist Caldeira and that most of outrage was from individuals who had read Joe Romm’s New York Times Blog (Dubner). I then went to read Romm’s blog listing entitled “Error-ridden Freakonomics.” Since I read the book, Romm’s blog, and Dubner’s response, I thought that they all had a reason to be upset. Romm was thinking as someone involved in the cutting edge technology of global warming. Dubner was thinking from the eyes of a layman who had little knowledge about technology. Like I stated before, I think Levitt and Dubner oversimplified the argument in order to have more entertainment value and so that it was more comprehensible to the average reader. Romm was striking out over simplifications, like all solar panels are black and neglecting to ask other questions about global warming. From my point of view, I think both opinions are valid, just like the two extremes of the political spectrum. In order to make the biggest impact on global warming, one needs to make behavioral changes and making infrastructural changes as well.

I disagree that television caused a rise in crime, because there are many other causes to crime. Television is unlikely to be the primary cause. Other causes of crime include desperation, lack of jobs, and inability to improve one’s social status (Education 190). Crime is likely to be multi-causal and there were likely to many other differences between cities who start with the same crime. Other factors that were not considered were immigration, economics, and city size (103). Levitt and Dubner then try to compare children within the same city between 1950 and 1955. I feel that this is also problematic because the world is a different place in 1950 and 1955. It does not take into account reasons for having children in the different years and still neglects economic conditions. It even states that “our data offers no firm answers” (104).

I agree with Levitt and Dubner that people are hard-wired for selfishness, due to natural selection and the need to weigh cost and benefits. Even though, someone may donate blood, they may do so because it shows off that they are a caring person. In order to get more donations, the American Red Cross implemented the “I donated” stickers. This same idea is used for voting. If I donate blood that may be attractive to someone else who is looking for a mate that is caring and giving. Everything has a cost, and humans and animals are always weighing the cost and the benefits. It is a similar reason for the monkeys choosing the situation with a gain. There is pleasure in having a benefit, as opposed to a cost.

For me, the most interesting aspect of the book was hearing new things about things that I had heard many times before. I had heard about apathy and altruism from the perspective of Kitty Genovese, lemmings, the Selfish gene, making being an organ donor the default, and problems with testing people in labs from courses at UC Berkeley. Hearing the same story retold with new facts and revelations, such as what the witnesses actually saw and their conclusions made my own viewpoint richer and exemplify how cross-discipline the world is. The concept of altruism that I had heard in molecular cell biology, psychology, genetics, genomics, animal behavior and now is found in economics. It also connects to the larger concept of why do people donate blood or their organs. It also resonates with me because I was stuck in a career choice between money and being selfish or trying to help society and be a teacher that makes less money and is treated more poorly than a doctor in day to day interactions.

The other chapter that was interesting and connected with me was “The fix is in.” After taking a course in public health, which emphasizes the need for prevention and hearing about how “male medicine” pushed out midwives connected me to another world that I could understand and relate to my own knowledge base. It connected because I wish that there were more simple cheap solutions that could used so that the nation would not be in debt and people in the United States were not dying or unnecessarily suffering from preventable diseases and illnesses. There are a lot of problems and not enough solutions. This ease of connectivity could be one of the reasons why books like Superfreakonomics are so successful.

Superfreakonomics has taught me some new things about both economics and politics. I had previously read Levitt and Dubner’s Freakonomics, which also showed how every day issues could be connected to economics. I was aware about supply and demand driving prostitution, but I was unaware about the economic consequences for other jobs, such as teaching (44). I linked the decreasing quality of teachers to the costs of other jobs, such as in medicine and business, but I did not see the link to prostitution and the male/female wage difference. “The Fix is in – and it’s cheap and simple” really shocked me and taught me a lot about changing people’s behavior, whether it’s changing seat belt usage to washing hands (138, 150). This same issue is relevant with AIDS and other public health initiatives around the world.

Lessons that I would take away from Superfreakonomics include looking at the world in open minded perspectives, looking across different disciplines, and drawing the world as a “marble-cake” where everything is blended and connected as opposed to distinct and separate. One cannot just use the interesting and entertaining parts, like soft news, and one cannot just use the conventional traditional way of thinking about policy. This book also shows additional evidence that the world is not black and white and that there is not just one great solution. It also shows that solutions are not dependent on predictable factors that can be measured in the lab. These lessons can be applied to predicting political outcomes, such as why Bush beat Gore in the 2000 election and even for explaining Obama’s rise to fame. But perhaps, even more powerful , they can be applied to almost any intellectual question. Superfreakonomics provides a lot of big concepts that can be applied to pop culture, politics, the economy, and daily life.

Works Cited

Dubner, Stephen. “Global Warming in SuperFreakonomics: The Anatomy of the a Smear.” Freakonomics Blog. 18 Oct 2009. 30 June 2010. http://freakonomics.blogs.nytimes.com/2009/10/18/global-warming-in-superfreakonomics-the- anatomy-of-a-smear/

Education 190. Current Topics in Education. Liliana Aguas. University of Californa – Berkeley. Spring 2010.

Klein, Ezra. “The Shoddy Statistics of Super Freakonomics” Washington Post. 16 Oct 2009. 30 June 2010. http://voices.washingtonpost.com/ezra- klein/2009/10/the_shoddy_statistics_of_super.html

Levitt, Steven D. and Stephen J. Dubner. Superfreakonomics: Global Cooling, Patriotic Prostitutes and Why Suicide Bombers Should Buy Life Insurance. New York: HarperCollins Publishers. 2009.

Plumer, Bradford. “Does Superfreakonomics need a do-over?”The New Republic. 16 Oct 2009. 30 June 2010. http://www.tnr.com/blog/the-vine/superfreakonomics-needs-redo

Romm, Joe. “Error-riddled Superfreakonomics.” 12 Oct 2009. 30 June 2010. http://climateprogress.org/2009/10/12/superfreakonomics-errors-levitt-caldeira-myhrvold/

“Superfreakonomics.” Wikipedia. 30 June 2010. http://en.wikipedia.org/wiki/SuperFreakonomics