Freakonomics: A Review

by Charumati Haran


Do you think economics is a boring, dismal science? Full of facts and figures, too theoretical and no scope for fun? In that case, Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven Levitt and Stephen Dubner will come as a pleasant surprise.

The book is a collection of articles, most of which had been previously published in academic papers and newspapers. They try to explore the economic side of everyday happenings and real-world issues. There are intriguing chapter titles such as: “What do schoolteachers and sumo wrestlers have in common?” and “What is more dangerous: a gun or a swimming pool?” These daily life riddles are explored in unusual ways and sometimes the authors prove conclusions that are completely against conventional wisdom and common sense. While you may not agree with all the claims made by the authors, the book is sure to be an exciting read.

The book has a basis in economic models such as the ‘rational’ consumer who aims to maximize his utility and also creatively uses the available data. The authors go off into interesting directions, such as criminology, sociology and psychology within politics, the real estate market, drug-dealing and even child-rearing! This book really brings economics into mainstream culture by provoking us to think like economists in daily life. The best part is that everything is presented in an easy-to-understand and entertaining way.

However, there has been a lot of criticism of the book as well, mostly by other economists, who argue that the book is not really a work of economics, but belongs in some other branch like sociology. Many economists also doubt the claims that have been made in the book, questioning the data used and the inferences made. Some argue that data conflicting with these claims also exists. Regardless, the book has been hugely popular and had sold over 4 million copies worldwide by 2009.

As for the authors, Levitt is an economist from the University of Chicago. He confesses that he’s not good at mathematics, econometrics or theory. He says he knows nothing about any of the conventional economics topics: taxes, deflation, growth of the economy or whether the stock market’s going to grow or shrink. But through the book, we see that he has a gift of seeing things differently from the average person and asking offbeat questions. He uses personal anecdotes and ingeniously uses mountains of data to find patterns: discovering clever, simple solutions in the process. Though some see him as a con-man who plays with economics, he has achieved a great deal: He’s a respected professor in the University of Chicago, the winner of the 2004 John Bates Clark medal and one of the Times “100 people who shape our world” in 2006. The book also has a chapter on one of his most controversial papers: the link between legalized abortion and crime rates. Another paper on cheating by schoolteachers actually led to teachers being fired.

Dubner is an award-winning American author and journalist. He has written for publications including The New York Times Magazine, The New Yorker, and Time. He has also written four books and numerous articles. But he is most famous as he co-author of Freakonomics and its sequel Superfreakonomics. He also taught English at the University of Columbia.

In the end, this book shows economics for what it really is: the study of incentives that we face all the time and the choices we end up making. So here is a final incentive to read this book: the bonus material available at the back of the book and on the Freakonomics blog. You won’t regret this choice!