Is anyone reading Freakonomics?

[cowtown]

I saw Steven Leavitt, the author of Freakonomics, on Jon Stewart. He's the young Univ. of Chicago guy who draws out interesting correlations in datasets that other researchers have not thought to do.

My wife and I are both reading it. Interesting stuff, but his lack of numbers in the book make it difficult to say how much stock to put in his findings. He presents the conclusions with a wink and a smile without any of the underlying data.

Of course, that's also what makes his research something you pick up at Costco rather than finding it in some obscure econ journal.

There's more than enough material to p*** off just about everyone. Just for starters:

-Political contributions don't affect races - implies McCain/Feingold is a waste of time and effort.

-Abortion legalization in the 70s depressed crime rates in the 90s - the would be criminals were aborted - implies the tough-on-crime right wingers should change their stance on abortion.

-Even though they're on commission, realtors don't care if their clients get top dollar for their houses.

A bunch of other stuff is in there. Anyone reading it? What do you think?

[RallyJon]

Just read it. Pop-economics for a mass audience. Most of what's in it is pretty intuitive if you're an honest thinker, but lots of it is politically incorrect.

The biggest caveat is that most of his work (being an economist) involves running regressions on huge amounts of data. This produces a lot of correlations--from which a smart guy can draw sensible conclusions--but falls well short of proof.

Still, a good read.

[techweenie]

Interesting. Generally, I find traditional economics to be overly simplistic and insular, in that it seems to be based upon an attempt to codify multi-dimensional situations into 2- and 3-dimensional thinking.

Anything that involves human behavior is just not that simple.

For instance, the notion that abortion affects the incidences of criminal behavior is potentially true, but far from the whole picture. Overall reproductive rates due to any number of factors produce the same result, since the vast majority of crimes are committed by males under 25. So war, famine, a soft economy... all have impacts on the percentage of young males in the population which then results in shifts in crime rates.

[s_wilwerding]

I haven't read the book, but I believe the link between abortion and a decreased crime rate was not just attributed to a drop in birth rate, but a drop in birth rate among the poor. Depending on the demographics of the army and who famine affects most, you might get the same results, but it's not exactly the same effect.

[cowtown]

Originally posted by RallyJon
The biggest caveat is that most of his work (being an economist) involves running regressions on huge amounts of data. This produces a lot of correlations--from which a smart guy can draw sensible conclusions--but falls well short of proof.

Good point. My wife is an economist, and does similar (though not as controversial) research. She focuses on Medicare/SSI trends in California by county. Some of the findings are very surprising, until you remind yourself that she is processing and regressing statewide data. This state has so many extremes and such a diversity of people, races, religions, etc. that it's very hard to draw any conclusions at all. Of course, if you're a macroeconomist, you just write a disclaimer about this and press on.

[vangndy]

This forum is awesome, i was just trying to think of the name of that book and author, it's like you guys can read my mind....... Thanks!

[Crowbob]

Colin,

So what are the county trends re. Medicare/SSI?