Fortean Times, October 2005
Freakonomics: A rogue
economist explores the hidden side of everything
Steven D Leavitt & Stephen J Dubner
Harper Collins, 2005
Hb, ppxiv+242, notes, index, ISBN 0 06 073132 X, $25.95
Economics in the FT (Fortean, that is, not Financial)? Surely some mistake?
It's easy to forget that that damning phrase 'the conventional wisdom' was coined by economist JK Galbraith to describe those comfortable untruths that bedevil all fields of inquiry. Economics, particularly the neo-classical variety which rules English-speaking academia, may be one of the worst offenders for cleaving to the orthodoxy. After all, an economist's definition of a paradox is a situation where reality obstinately refuses to accord with theory.
'Freakonomics' is a best-selling account of research by much-lauded economist Steven Levitt, written in partnership with journalist Stephen Dubner. The book sets out to overturn the conventional wisdom on various matters of popular concern among them school selection, estate agents, child safety and drug dealers, subjects which seem selected to appeal to the mass market of middle-class anxieties.
It's debatable whether this is economics at all the reliance on regression analysis, the main statistical tool in the economist's armoury, doesn't make it so; although the emphasis on incentives, whether financial or less quantifiably social, may.
Many of Levitt's conclusions have sparked considerable (if variably informed) debate in the mass media most notably, his argument that the wider availability of legal abortions in the US is a leading factor in a declining crime rate. However, perhaps the most surprising thing is that a book which argues that one's prospects in life are more determined by social (one might even say class-based) factors rather than by character has proven such a commercial success in the US could this be a late victory for Marx in the country of Alger and Rand?
The emphasis is on taking a hard look at the actual data relating to a question before drawing conclusions, something that is sorely lacking in too much social or political writing. That still leaves the question of selection of both data and metrics, of course. Here, for example, the section on the relative safety of swimming pools versus guns looks solely at the costs in terms of accidental deaths caused by each and not their benefits, leading to a rather incomplete conclusion.
The distinction between causation and correlation is also something that's always welcome; as is a healthy mistrust of experts, particularly those than rely on information asymmetries to maintain personal power.
The book is however hamstrung by a style that can swing between the self-consciously quirky and the cloying. Dubner's contributions are not so much uncritical of Levitt as worshipful the 'most brilliant young economist in America' is, apparently, a 'noetic butterfly that no one has pinned down'. This is perhaps ironic considering Dubner's earlier book, 'Confessions of a Hero-Worshiper'. Some more critical contributions from other social scientists would have helped put Levitt's work in context.
Many readers will find the book frustratingly lightweight, especially when compared to other popular books dealing with less conventional economic subjects, such as Robert Shiller's 'Irrational Exuberance'. One could call this the 'Da Vinci Code' of social science, especially considering its blockbusting sales. Of course, all this means is that much of this Freakonomics is already becoming the conventional wisdom, and ripe for overturning in turn.