43 pages • 1 hour read
Steven D. Levitt, Stephen J. DubnerA modern alternative to SparkNotes and CliffsNotes, SuperSummary offers high-quality Study Guides with detailed chapter summaries and analysis of major themes, characters, and more.
Summary
Chapter Summaries & Analyses
Key Figures
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Important Quotes
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“The modern world demands that we all think a bit more productively, more creatively, more rationally; that we think from a different angle, with a different set of muscles, with a different set of expectations; that we think with neither fear nor favor, with neither blind optimism nor sour skepticism. That we think like—ahem—a Freak.”
This is as close as the authors come to defining what a “Freak” is. A back-formation from the word Freakonomics, the term is used liberally throughout the text to describe someone who approaches problems in a unique way, relying on data and realistic observations. Given the word’s common definition, which has a slightly negative connotation, its use here is also part of the authors’ playful and quirky tone.
“Our thinking is inspired by what is known as the economic approach. That doesn’t mean focusing on ‘the economy’—far from it. The economic approach is both broader and simpler than that. It relies on data, rather than hunch or ideology, to understand how the world works, to learn how incentives succeed (or fail), how resources get allocated, and what sort of obstacles prevent people from getting those resources, whether they are concrete (like food and transportation) or more aspirational (like education and love).”
This passage further refines what is meant by thinking like a so-called Freak. Overwhelmingly, the emphasis is on data and objective observation—that is, the actual rather than the hoped for, the realistic rather than the ideologically or morally pure. The authors want to teach people to think about the world as it truly is, not as they think it should be.
“When asked to name the attributes of someone who is particularly bad at predicting, Tetlock needed just one word. ‘Dogmatism,’ he says. That is, an unshakable belief they know something to be true even when they don’t. Tetlock and other scholars who have tracked prominent pundits find that they tend to be ‘massively overconfident,’ in Tetlock’s words, even when their predictions prove stone-cold wrong. That is a lethal combination—cocky plus wrong—especially when a more prudent option exists: simply admit that the future is far less knowable than you think.”
The authors describe the research of Philip Tetlock, who studied the predictions made by people considered to be experts. The results showed that “dart-throwing chimps” would be almost as accurate (24). Even though almost all the experts in the study had postgraduate training, their predictions were less accurate than a computer algorithm also used in the study. The authors include this in a discussion of why people refuse to admit when they don’t know something.
“If the consequences of pretending to know can be so damaging, why do people keep doing it?
That’s easy: in most cases, the cost of saying ‘I don’t know’ is higher than the cost of being wrong—at least for the individual.”
This is an early example of incentives. The authors explain that when someone makes a prediction that turns out to be wrong, they rarely pay a price for it, perhaps because too much time has passed. Complex situations can also be hard to interpret accurately and blame hard to assign. People know this and act in self-interest: If they’re right, they take credit for it, and if they’re wrong, nothing happens. Incentives thus lead people to make predictions.
“But a lot of obvious ideas are only obvious after the fact—after someone has taken the time and effort to investigate them, to prove them right (or wrong). The impulse to investigate can only be set free if you stop pretending to know answers that you don’t. Because the incentives to pretend are so strong, this may require some bravery on your part.”
Part of thinking like a Freak is breaking free of the obvious. Most people have a herd mentality; they go along with others, afraid to take a risk and be different. We often make assumptions and pretend to know things we don’t. Thinking like a Freak means having the courage to break this pattern.
“Here is the broader point: whatever problem you’re trying to solve, make sure you’re not just attacking the noisy part of the problem that happens to capture your attention. Before spending all your time and resources, it’s incredibly important to properly define the problem—or, better yet, redefine the problem.”
This passage touches on the theme of seeing a problem clearly. The authors note at the beginning of this chapter that we often get our ideas about something from the media or because it’s something that affects us personally. It’s easy to rely on the obvious, but a problem can never truly be addressed unless it’s understood correctly—which means properly defined. Otherwise, you’re wasting your time and money barking up the wrong tree. Takeru Kobayashi, the competitive eater, understood this when he redefined the problem in the hot dog eating contest.
“All of us face barriers—physical, financial, temporal—every day. Some are unquestionably real. But others are plainly artificial—expectations about how well a given system can function, or how much change is too much, or what kinds of behaviors are acceptable. The next time you encounter such a barrier, imposed by people who lack your imagination and drive and creativity, think hard about ignoring it. Solving a problem is hard enough; it gets that much harder if you’ve decided beforehand it can’t be done.”
This refers to the artificial barriers that often prevent people from solving a problem or improving their performance. Note the emphasis the authors place on “imagination and drive and creativity,” which are hallmarks of thinking like a Freak. Levitt and Dubner again remind us of the importance of thinking differently and seeing things from new angle. Kobayashi, the champion hot dog eater, didn’t break the record by a few more hot dogs, he doubled it. Likewise, it was once thought impossible for humans to run a mile in under four minutes—until Roger Bannister did it.
“But the big problems that society cares about—crime and disease and political dysfunction, for instance—are more complicated than that. Their root causes are often not so nearby, or obvious, or palatable. So rather than address their root causes, we often spend billions of dollars treating the symptoms and are left to grimace when the problem remains. Thinking like a Freak means you should work terribly hard to identify and attack the root cause of problems.”
This is part of the theme of seeing a problem clearly. A problem can’t be solved until the true cause is known. The example of ulcers is one case that shows this very well. Billions of dollars were spent worldwide every year treating ulcers. Their true cause, however, remained unknown until the 1980s—and was only discovered due to the persistence of one researcher.
“Once you start looking at the world through a long lens, you will find many examples of contemporary behaviors that are driven by root causes from centuries past.”
This is a reminder to look past the obvious and close at hand. Many issues have origins that are far removed from contemporary factors. Examples given in the book are higher rates of heart disease for African Americans (traced back to the slave trade), inequality in Germany (traced back to the division between Protestantism and Catholicism in the 16th century), and declining crime rates in the United States (traced back to Roe v. Wade).
“To Borody and a small band of like-minded brethren who believe in the power of poop, we are standing at the threshold of a new era in medicine. Borody sees the benefits of fecal therapy as ‘equivalent to the discovery of antibiotics.’ But first, there is much skepticism to overcome.”
This reference is a follow-up to Barry Marshall’s discovery of the bacterium that causes ulcers. That led to an entirely new field in medicine having to do with gut microbes, and today fecal transplants are used to treat various medical conditions. The passage is another example of the authors’ irreverent writing style, which parallels the quirky thinking process of Freaks.
“To think like a Freak means to think small, not big. Why? For starters, 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. Such problems are intractable, hopelessly complex, brimming with entrenched and misaligned incentives. Sure, there are some truly brilliant people out there and they probably should think big. For the rest of us, thinking big means you’ll spend a lot of time tilting at windmills.”
This passage helps define what it means to think like a Freak. Despite the authors’ success in their work, they focus on small rather than large phenomena, and they encourage others to do so as well. It’s part of their advice to think like a child, which helps you see a problem clearly. Many problems are too large and complicated to be addressed in a one-size-fits-all manner, so tackling individual aspects of them is a smarter way to go.
“Here’s another cardinal rule of thinking like a child: don’t be afraid of the obvious.
The two of us are sometimes invited to meet with a company or an institution that wants outside help with some kind of problem. Walking in, we usually know next to nothing about how their business works. In most instances in which we wind up being helpful, it is the result of an idea that arose in the first few hours—when, starting from complete ignorance, we asked a question that an insider would never deign to ask. Just as many people are unwilling to say ‘I don’t know,’ nor do they want to appear unsophisticated by asking a simple question or making an observation that was hidden in plain sight.”
Somewhat counterintuitively, seeing a problem clearly often means starting from a place of ignorance rather than knowledge. This gets back to thinking like a child, or seeing things with fresh eyes. An insider begins with all sorts of assumptions and expectations, whereas an outsider has none. The words “afraid,” “deign,” and “appear” indicate that this is largely about feeling foolish in front of one’s peers, and having a herd mentality (as most of us do) often sets the boundaries of the debate. Children, on the other hand, plunge right in and say what’s on their mind; this is the spirit of openness that the authors encourage.
“Perhaps the arena most in need of a fun injection is public policy. Think about how policymakers generally try to shape society: by cajoling, threatening, or taxing people into behaving better. The implication is that if something is fun—gambling or eating cheeseburgers or treating the presidential election like a horse race—then it must be bad for us. But it doesn’t have to be that way. Rather than dismiss the fun impulse, why not co-opt it for the greater good?”
Another aspect of thinking like a child is having fun. Adults, the authors argue, rarely have fun the same way, probably to their detriment. First, having fun allows you to work harder: People who love what they do stick with it. Those who treat a job as just a job are probably not as invested. More important might be how fun works with incentives. As the authors explain in Chapter 6, moral incentives don’t often work (and can even backfire). Just after the passage quoted above, they describe a savings plan based on the same principles as the lottery, which allows people to save and have fun at the same time. Soberly telling people the benefits of saving money likely wouldn’t be as effective at getting them to do it.
“If there is one mantra a Freak lives by, it is this: people respond to incentives. As utterly obvious as this point may seem, we are amazed at how frequently people forget it, and how often it leads to their undoing. Understanding the incentives of all the players in a given scenario is a fundamental step in solving any problem.
Not that incentives are always so easy to figure out. Different types of incentives—financial, social, moral, legal, and others—push people’s buttons in different directions, in different magnitudes. An incentive that works beautifully in one setting may backfire in another. But if you want to think like a Freak, you must learn to be a master of incentives—the good, the bad, and the ugly.”
This passage clearly shows the importance the authors place in incentives, which are central to their way of thinking. Discovering what makes people act in any given situation is essential to understanding a problem well enough to fix it. The tricky part is that not everyone responds the same way to the same incentives, and their response can change over time. Likewise, incentives can backfire if not applied properly.
“No matter how much fun you have at work—and no matter how often you hear a professional athlete swear he’d play for free—few people are willing to work very hard without getting paid. No CEO in the world, therefore, is so delusional as to expect his employees to show up every day and work hard for no money. But there is one gigantic workforce asked to do exactly that. In the United States alone, they number nearly 60 million. Who is this massive, underpaid throng? Schoolchildren.”
This is a clear-eyed look at the role incentives play in education. The authors explain what motivates people to do work and ask why we expect students to work for free. It’s a good example of thinking like a Freak because most people wouldn’t give the issue a second thought; paying children to do their homework is just not done. However, seeing a problem clearly includes asking the obvious—in this case, “Why not?” Research has been done on this issue, which shows mixed results, but the point is to examine every angle, no matter how crazy or obscure it may seem.
“Cash incentives, with all their limitations and wrinkles, are plainly not perfect. But here’s the good news: it is often possible to elicit the behavior you want through nonfinancial means. And it’s a lot cheaper too.
How to do this?
The key is to learn to climb inside other people’s minds to figure out what really matters to them.”
The authors stress that while cash incentives are an obvious choice and can often be used effectively, other incentives can work just as well. The only barrier is discovering exactly what works. It’s not enough to ask people, as the study on energy conservation that follows this quotation shows, because people often say one thing but do another. Running some kind of test or experiment is the best way to learn which incentives will be truly effective.
“Does Cialdini’s research depress you? Perhaps it suggests that we humans are incorrigibly felonious, hell-bent on grabbing our fair share and then some; that we are always looking out for ourselves rather than the greater good; that we are, as the California energy study showed, a big fat pack of liars.
But a Freak wouldn’t put it that way. Instead, you’d simply observe that people are complicated creatures, with a nuanced set of private and public incentives, and that our behavior is enormously influenced by circumstances. Once you understand how much psychology is at work when people process incentives, you can use your wiles to create incentive plans that really work—either for your own benefit or, if you prefer, for the greater good.”
This explains a key aspect of thinking like a Freak: seeing things objectively. Several times in the book Levitt and Dubner caution against allowing one’s “moral compass” or any kind of dogma to interfere with analyzing a situation. The fact is that people are complex and often respond in surprising ways. To solve any problem, one has to see things as they actually are, not as one thinks they should be.
“A person who is lying or cheating will often respond to an incentive differently than an honest person. How can this fact be exploited to ferret out the bad guys? Doing so requires an understanding of how incentives work in general (which you gained in the last chapter) and how different actors may respond differently to a given incentive (as we’ll discuss in this one). Certain tools in the Freak arsenal may come in handy only once or twice in your lifetime. This is one such tool. But it has power and a certain elegance, for it can entice a guilty party to unwittingly reveal his guilt through his own behavior.
What is this trick called? We have scoured history books and other texts to find a proper name for it, but came up empty. So let’s make up something. In honor of King Solomon, we’ll treat this phenomenon as if it were a lost proverb: Teach Your Garden to Weed Itself.”
Game theory is a topic covered in Chapter 7, and it’s part of the theme of shaping behavior. It’s different from usual incentives in that it plays a role in identifying people who are actively trying not to be identified. By anticipating their thought process, you have to try to get them to act in a way others would not. Once they introduce the saying in the last line—“teach your garden to weed itself”—the authors use it throughout the chapter as a kind of mantra as they give examples of how game theory has been used.
“The solution, the story goes, was in the beer. The British officers had complained that the beer at the kibbutz was too warm; they preferred it chilled. Their Jewish friends, eager to please, made a proposal: The next time you plan to visit, call us beforehand and we will put some beer on ice for you. Done and done! According to kibbutz legend at least, this warm-beer alarm worked like a charm: the British officers never again pulled a surprise visit to the factory, which went on to produce more than two million bullets for use in Israel’s War of Independence. The kibbutzniks had cannily appealed to the Brits’ narrow self-interest in order to satisfy their own much broader one.”
This is a story of how game theory was used in Israel at the end of World War II. Israelis expected war to break out with Palestinians when the British left, but under the existing law, it was illegal to manufacture ammunition. The Israelis did so anyway, creating a secret factory below ground, under the laundry facility of a kibbutz. Once a British soldier dropped by unannounced, and a close call was averted only when he was ushered into the dining hall for a beer at the last minute. The above describes how this scenario was cleverly avoided in the future by the Israelis anticipating any future visits.
“Here’s how Herley put it in a research paper: ‘The goal of the e-mail is not so much to attract viable users as to repel the non-viable ones, who greatly outnumber them. […] A less-outlandish wording that did not mention Nigeria would almost certainly gather more total responses and more viable responses, but would yield lower overall profit. […] [T]hose who are fooled for a while but then figure it out, or who balk at the last hurdle, are precisely the expensive false positives that the scammer must deter.’
If your first instinct was to think that Nigerian scammers are stupid, perhaps you have been convinced, as Cormac Herley was, that this is exactly the kind of stupid we should all aspire to be. Their ridiculous e-mails are in fact quite brilliant at getting the scammers’ massive garden to weed itself.”
The authors explain the rationale behind the spam messages sent out to elicit money (often by someone claiming to be Nigerian). On the face of it, the emails are absurd, but the authors see things differently through the perspective of game theory. The scammers appear to be stupid only to find people gullible enough to perhaps fall for it. It would be a waste of time to communicate with people who don’t follow through, which is most people. If the email seemed too plausible, many more people would respond, and the scammers would need to weed them out one at a time. However, the approach they take does the job for them, so they can spend their time cultivating those dumb enough to actually send them money.
“Our best advice would be to simply smile and change the subject. As hard as it is to think creatively about problems and come up with solutions, in our experience it is even harder to persuade people who do not wish to be persuaded.”
These two lines come at the beginning of Chapter 8 and are somewhat surprising given the authors’ apparent brilliance and insight into various phenomena. Surely they must be able to persuade just about anyone of their point of view. It’s actually another example of their clear-eyed realism in seeing things as they are, not as we wish them to be. Research has shown that persuading people who are not open to the possibility is nearly futile. At the end of Chapter 1, the authors give an example of this from their own experience with former British Prime Minister David Cameron.
“When someone is heavily invested in his or her opinion, it is inevitably hard to change the person’s mind. So you might think it would be pretty easy to change the minds of people who haven’t thought very hard about an issue. But we’ve seen no evidence of this. Even on a topic that people don’t care much about, it can be hard to get their attention long enough to prompt a change.”
The authors explain why persuasion is so difficult as to almost be impossible. Most of us think a solid argument and foolproof logic are enough to change someone’s mind, but the truth is those things are not influential factors. Research shows that people with or without strong opinions are unlikely to change their minds, mostly due to the strength of ideology and herd mentality.
“A recent survey found that only 14 percent of U.S. adults could recall all Ten Commandments; only 71 percent could name even one commandment. (The three best-remembered commandments were numbers 6, 8, and 10—murder, stealing, and coveting—while number 2, forbidding false gods, was in last place.)
Maybe, you’re thinking, this says less about biblical rules than how bad our memories are. But consider this: in the same survey, 25 percent of the respondents could name the seven principal ingredients of a Big Mac, while 35 percent could name all six kids from The Brady Bunch.
If we have such a hard time recalling the most famous set of rules from perhaps the most famous book in history, what do we remember from the Bible?”
The answer to the question posed in the last sentence of this quotation is that stories like Adam and Eve or Cain and Abel are what we remember. The point being made here is that stories catch people’s attention, so they are one of the best ways of trying to persuade someone of something. People often rely on facts and statistics when building a logical argument, but it turns out they are less effective. Stories include facts, but they also show progression through time and allow people to envision themselves in the story, making a stronger impact.
“The message is unequivocal: failure may be an option but quitting is not. The American version goes like this: ‘A quitter never wins, and a winner never quits.’ To quit is to prove oneself a coward, a shirker, a person of limited character—let’s face it, a loser. Who could possibly argue with that?
A Freak, that’s who.”
This passage deals with the theme of failure and quitting. The authors first explain how strong the impulse not to quit is in our society before upending the narrative by disagreeing. It’s another example of how thinking like a Freak often goes against the grain by taking an unusual or surprising perspective. Quitting, they argue, actually makes a lot of sense sometimes, which they go on to explain.
“Now that we’ve arrived at these last pages, it’s pretty obvious: quitting is at the very core of thinking like a Freak. Or, if that word still frightens you, let’s think of it as ‘letting go.’ Letting go of the conventional wisdoms that torment us. Letting go of the artificial limits that hold us back—and of the fear of admitting what we don’t know. Letting go of the habits of mind that tell us to kick into the corner of the goal even though we stand a better chance by going up the middle.”
Part of the significance of quitting is what it represents. For Levitt and Dubner, this is cutting oneself free of the boundaries formed by the commonplace, the obvious, the conventional. They illustrate this well by redefining “quitting” as “letting go.” Artificial constraints are obstructions that inhibit too many of us. If you want to think like a Freak, they say, you have to cast off the fear and habits that set these artificial boundaries. Only then can you break new ground and see things clearly enough to fix problems and get answers.