Saturday, February 21, 2009

Freakonomics - Steven Levitt & Stephen Dubner

Freakonomics by Steven Levitt & Stephen Dubner is subtitled "A Rogue Economist Explores The Hidden Side Of Everything" and that pretty much sums up the book in a nutshell. It is a fast, entertaining read applying the laws of economics to some highly unusual topics. If you were ever curious as to what school teachers and sumo wrestlers have in common, or why drug dealers still live with their moms, then this is the place to come and explore the answers! The main take home message of the book is the danger of mistaking correlation for causation in regression analysis, but you won't find yourself caught up in reams of long economic theory.

Particularly of interest to me was the study of incentives. What motivates people to do things, and how can you provide the right kind of incentive to get the outcome you want. It offers an unconventional look at conventional wisdom, and often comes up with some surprising answers.

This really is a light, entertaining read and if you enjoy the book, the authors also have a Freakonomics blog.

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