American Economist, Author of Freakonomics
American Economist, Author of Freakonomics
In a complex world where people can be atypical in an infinite number of ways, there is great value in discovering the baseline. And knowing what happens on average is a good place to start. By so doing, we insulate ourselves from the tendency to build our thinking - our daily decisions, our laws, our governance - on exceptions and anomalies rather than on reality.
keepers jump left 57 percent of the time and right 41 percent?which means they stay in the center only 2 times out of 100. A leaping keeper may of course still stop a ball aimed at the center, but how often can that happen? If only you could see the data on all penalty kicks taken toward the center of the goal! Okay, we just happen to have that: a kick toward the center, as risky as it may appear, is seven percentage points more likely to succeed than a kick to the corner. Are you willing to take the chance?
Households that got the once-and-done letter were twice as likely to become first-time donors as people who got a regular solicitation letter. By fund-raising standards, this was a colossal gain. These donors also gave slightly more money, an average of $56 versus $50.
In a medical study, it turned out that obstetricians in areas with declining birth rates are much more likely to perform cesarean-section deliveries than obstetricians in growing areas?suggesting that, when business is tough, doctors try to ring up more expensive procedures.
Knowing and doing are two different things, especially when the situation involves pleasure.
Deliberate practice has three key components: setting specific goals; obtaining immediate feedback; and concentrating as much on technique as on outcome.
How are you supposed to get everyone to pull in the same direction when they are all pulling primarily for themselves?
In the United States especially, politics and economics don?t mix well. Politicians have all sorts of reasons to pass all sorts of laws that, as well-meaning as they may be, fail to account for the way real people respond to real-world incentives.
Knowing what to measure, and how to measure it, can make a complicated world less so.
Despite spending more time with themselves than with any other person, people often have surprisingly poor insight into their skills and abilities.
How can this type of data be made to tell a reliable story? By subjecting it to the economist?s favorite trick: regression analysis. No, regression analysis is not some forgotten form of psychiatric treatment. It is a powerful?if limited?tool that uses statistical techniques to identify otherwise elusive correlations.
Incentives are the cornerstone of modern life. And understanding them?or, often, deciphering them?is the key to understanding a problem, and how it might be solved.
Don?t listen to what people say; watch what they do.
How is a street prostitute like a department-store Santa?
Information is a beacon, a cudgel, an olive branch, a deterrent--all depending on who wields it and how.
Economists have had many difficulties to explain the past, so let's not predict the future.
How selfish soever man may be supposed, Smith wrote, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it.
Internet, despite its power, it has failed to slay the beast of the information asymmetry.
every big problem has been thought about endlessly by people much smarter than we are. The fact that it remains a problem means it is too damned hard to be cracked in full.
However, when it holds a supplier, it creates a shortage that inevitably drives prices up, attracting more suppliers to the market. The drug war waged by the United States has been relatively ineffective for just concentrate on the sellers, not the buyers.
It has long been said that the three hardest words to say in the English language are I love you. We heartily disagree! For most people, it is much harder to say I don?t know.
Every time we pretend to know something, we are doing the same: protecting our own reputation rather than promoting the collective good.
I do think that the standard media is controlled by the conventional wisdom about global warming. We've come to believe - from reading a lot of articles and talking to a lot of scientists - that there's another side to be heard.
It is easy to get seduced by complexity; but there is virtue in simplicity too
Everyone?s entitled to their own opinion but not to their own facts.