Written by two friends, one an economist and the other a writer and journalist, Freakonomics is a study of diverse economic scenarios, rarely looked at by traditional economists. The tag line for this book is "A Rogue Economist Explores the Hidden Side Of Everything". Our rogue economist here is Steven Levitt. Levitt is a very well respected U.S. economist and it is his interest in drug gangs, crime, policing and cheating that have earned him the title rogue economist. All of these interests surface at some point in this book. The journalist in question is Stephen J. Dubner, who has written articles for The New York Times, The New Yorker and Time Magazine, including the initial article that appeared in The New York Times that gave rise to this publication.
The book itself reads as a series of essays and has no unifying theme. The subject of each chapter has appeared at one point or another in some other publication. This book is aimed at people with a limited knowledge of economics - there are no complex ideas here. He uses simple principles to analyse the data he chooses to look at. But this is not to say that his conclusions are simple. Levitt's innate talent lies in his abilities to look past the obvious deductions and to be able to see the underlying cause of patterns in the data. Not all his comments are groundbreaking but in some cases they can be quite radical. For example, on the back of an analysis of data spanning 20,000 children from kindergarten through to the fifth grade, the reader is led to believe that good parenting is not a product of what you do but rather who you are. That the future of your child is determined long before they are born is an idea sure to infuriate many academics and parents alike.
On the other hand, sometimes the reader is presented with the justification of ideas that can seem quite commonsensical. Would it come as a surprise to most people, that given the right incentive, most people might be prepared to cheat? Probably not, but that does not make Levitt's dissection of seven years of Chicago Public School test data to establish cheating in the teaching profession any less interesting. Indeed, quite often in this book, it is not the subject matter that is most interesting, but rather Levitt's analysis. He relies on his ability to ask the right questions and look at reams of figures from a skewed angle to see things in a new light.
The book, for the most part, follows this process: Levitt giving his take on numbers most people probably have never looked at. Funnily enough, the one time anecdote is favoured over fact, it turns out that the source may not have been entirely honest. Fortunately for Levitt and Dubner, this does not undermine the point they are trying to make too dramatically, but it does unintentionally highlight something that is mentioned repeatedly through the book: statistics are the only thing that you can really trust, but even then, they only reveal the truth when probed with the right questions. For example, in the mid to late 1990's, there was a dramatic crime drop, unpredicted by any journalists, economists or politicians of the time. In fact they had been predicting it to rise in the opposite direction. A whole host of reasons then appeared attempting to explain this drop but none of these held any water with Levitt so he decided to look at things a little differently by asking where these criminals went. He comes to the conclusion that the introduction of abortion in the U.S. twenty years earlier removed all the would-be criminals from the streets. This is quite a sensational claim and whilst Levitt does argue against the other explanations it is more likely that the true explanation lies in a combination of numerous reasons, but this example nicely illustrates the style of his approach.
Freakonomics is written in quite an informal way. Never does the reader feel as if he or she is being talked down to. I am unsure how much input our rogue economist had into the actual wording of the book. Nonetheless, there is no academic arrogance in this book that Levitt's Harvard and M.I.T. accolades may have brought to the table.
The best thing to take from this book is Levitt's data mining capabilities there is more to be learned from his thought process than his thoughts. This book appeared as required reading for all freshmen in Appalachian State University in 2006, presumably for this reason (though also, I'm sure, as some form of tribute to Dubner, who graduated from there in 1984) as not everything here would be of great academic value. Though it would be unfair to criticise the book in this regard as it never attempts to sell itself in this light. For the most part, it delivers a series of somewhat enlightening observations, well argued and soundly supported. Unfortunately, there are also some mundane ones in there. At times it makes for compelling reading, but not always.
There is a blog at http://www.freakonomics.com, which is regularly updated, and definitely worth visiting to get a flavour of what is on offer.