SuperFreakonomics: Global Cooling, Patriotic Prostitutes, and Why Suicide Bombers Should Buy Life Insurance

“The economic approach isn’t meant to describe the world as any one of us might want it to be, or fear that it is, or pray that it becomes—but rather to explain what it actually is. Most of us want to fix or change the world in some fashion. But to change the world, you first have to understand it.”

This quote describes the economic approach, the fundamental tool that the authors use to explore all the topics in this book. This approach showcases the curious, nonjudgmental attitude of the authors, who are interested in everyone who engages in the economy, from sex workers to terrorists to doctors to monkeys.

“Much has been said of the Internet’s awesome ability to ‘disintermediate’—to cut out the agent or middleman—in industries like travel, real estate, insurance, and the sales of stocks and bonds. But it is hard to think of a market more naturally suited to disintermediation than high-end prostitution.”

This quote illustrates the authors’ talent for pulling in economic theory in unexpected ways. The concept of disintermediation is quite relevant to earlier problems in this chapter, given that sex workers suffer the most violence when they have to negotiate with clients in person. Ally therefore utilizes the internet as an economic tool to navigate the dangerous world of sex work, and her approach shows the benefits of applying technological innovation to a commonly stigmatized profession.

“Allie has never had any trouble with the police, and doesn’t expect to. The truth is that she would be distraught if prostitution were legalized, because her stratospherically high wage stems from the fact that the service she provides cannot be gotten legally.”

This quote explicates the essential driving force of supply and demand. Scarcity of supply creates higher demand, so Ally benefits from the enforced scarcity of criminalized sex work. However, other sex workers like LaSheena, although competing in the same market, suffer from the criminalized nature of the work, since they are much more likely than Ally to be arrested.

“It is no exaggeration to say that a person’s entire life can be greatly influenced by the fluke of his or her birth, whether the fluke is one of time, place, or circumstance.”

Although the authors acknowledge that birth order, location, gender, and family resources often play a role in success and potential, they also point out that some factors influence success in less obvious ways. As an example, they cite the fact that students whose names are listed toward the beginning of the alphabet often garner greater attention in schools. The authors argue that these flukes of circumstance dictate success more often than people believe.

“Crime is primarily driven by personal gain, whereas terrorism is fundamentally a political act. In his analysis, the kind of person most likely to become a terrorist is similar to the kind of person most likely to… vote. Think of terrorism as civic passion on steroids.”

This quote underlines the authors’ characteristically wry sense of humor. This type of glib reference to grim social disasters is part of their literary style, though opponents of their work criticize them for failing to acknowledge the full severity of their topics of discussion.

“Terrorism is effective because it imposes costs on everyone, not just its direct victims. The most substantial of these indirect costs is fear of a future attack, even though such fear is grossly misplaced. The probability that an average American will die in a given year from a terrorist attack is roughly 1 in 5 million: he is 575 times more likely to [die by] suicide.”

This quote shows the value of the economic approach to emotional motivations. By spelling out the actual risks of dying in a terror attack, the authors imply that the fear most people feel at the prospect is overblown—and by extension, so are the social measures put in place to deter terrorism.

“Such a massive accumulation of data creates other opportunities. It lets doctors seek out markers for diseases in patients who haven’t been diagnosed. It makes billing more efficient. It makes the dream of electronic medical records a straightforward reality. And because it collects data in real time from all over the country, the system can serve as a Distant Early Warning Line for disease outbreaks or even bioterrorism.”

This quote refers to Azyxxi (later rebranded as Amalga), the object-oriented programming project of Dr. Feied. This description of the program showcases the economist perspective towards new technology, which seeks to examine the real life short- and long-term effects on actual human beings’ behavior.

“So it may be that going to the hospital slightly increases your odds of surviving if you’ve got a serious problem but increases your odds of dying if you don’t. Such are the vagaries of life.”

This quote underlines the gallows humor inherent in the authors’ approach. By stating that a hospital visit “slightly increases your odds of surviving,” they deliberately make light of a rather grim issue: the prospect of dying at a hospital. However, their ultimate goal is to point out that most of the time, the statistics indicate that individual decisions do not make much of a difference in the long run.

“If a budding terrorist wants to cover his tracks, he should go down to the bank and change the name on his account to something very un-Muslim (Ian, perhaps). It also wouldn’t hurt to buy some life insurance. Horsley’s own bank offers starter policies for just a few quid per month.”

This quote showcases the disarmingly casual tone that Levitt and Dubner employ throughout their work. This cheerful recommendation to would-be terrorists is clearly meant to have a humorous effect. However, their choice of wording received criticism from readers and reviewers alike. However, in a later book, the authors revealed that this passage was published as part of a social engineering strategy spearheaded by British authorities; it was intended to catch terrorists, not to aid them. This subsequent development shows that the economists not only considered their words carefully, but  they also considered the long-term ramifications of their statements. This follow-up lends confidence to the veracity and responsibility of the rest of their work.

“In March 1964, late on a cold and damp Thursday night, something terrible happened in New York City, something suggesting that human beings are the most brutally selfish animals to ever roam the planet.”

Whenever these authors state a point matter-of-factly, they then go on to demonstrate that each seemingly clear-cut issue is not actually concrete or simple. In this case, they highlight the fact that for years (if not decades), the murder of Kitty Genovese was presented as a simple failure of human empathy. However, the authors reexamine the case to show that this assumption was patently false, and that “simple” explanations for human behavior should always be viewed with skepticism.

“We all witness acts of altruism, large and small, just about every day. (We may even commit some ourselves). So why didn’t a single person exhibit altruism on that night in Queens?”

This quote points out that examples of altruism are commonplace in everyday life. This so-called heartless neglect of Kitty Genovese, when studied more closely, appears to be a huge outlier. However, the authors soon reveal that the witnesses to the murder did attempt to help, but the media sensationalized the case, making the issue seem far simpler than it actually was.

“In a prosperous world, simple and cheap fixes sometimes get a bad rap; we are here to defend them.”

This quote, which is written in the authors’ characteristically concise and glib style, aligns with their broader argument that changes need not be sweeping or impressive in order to make a difference; the authors contend that many of the world’s best innovations are “simple and cheap.” Once again, the authors foreground economic considerations in a way that is designed to challenge common assumptions.

“The cleverest engineer or economist or politician or parent may come up with a cheap, simple solution to a problem, but if it requires people to change their behavior, it may not work.”

The cynical tone of this quote illustrates that “cheap and simple” solutions are not necessarily easy to implement. By implying that people almost never change their behavior, the authors reveal an essentially negative view of human nature, contending that people must perceive a significant personal benefit before they will deign to change their existing behavior patterns. Notably, Feied overcame this obstacle by forbidding other doctors from using his new technology, an example of reverse psychology that prompted them to immediately adopt it. Levitt and Dubner endorse other such subtle behavioral motivations to incentivize change, such as offering money for spare kidneys.

“People are generally unwilling to spend a lot of money to avert a future problem, especially when its likelihood is so uncertain. One good reason for waiting is that we might have options in the future to avert the problem that cost far less than today’s options.”

This quote introduces the problematic optimism at the heart of the human response to climate change. The uncertainty of the future leads people to put off making big changes, since, like medical technology in an ER, innovations that mitigate or even negate the problem could be arriving any minute.

“Once you strip away the religious fervor and scientific complexity, an incredibly simple dilemma lies at the heart of global warming. Economists fondly call it an externality.”

This quote digs to the heart of what Levitt and Dubner argue is the real climate change crisis. The inclination to get past emotional aspects of human behavior and instead look at cold, hard economic facts is characteristic of the authors’ unconventional approach.

“When people aren’t compelled to pay the full cost of their actions, they have little incentive to change their behavior. Back when the world’s big cities were choked with horse manure, people didn’t switch to the car because it was good for society; they switched because it was in their economic interest to do so.”

This quote showcases the problem of externalities. Although negative externalities can cause a problem for the whole world, individuals do not feel compelled to negate them until these factors threaten the individuals themselves. The authors contend that economic interests, though less inspirationally altruistic, are a foolproof method of convincing people to change their behavior.

“What if some foolish people thought Pinatubo could perhaps serve as a blueprint to stop global warming? The same sort of fools who, for instance, once believed that women didn’t have to die in childbirth, that world famine was not foreordained? While they’re at it, could they also make their solution cheap and simple?”

This quote illustrates the “economic approach” endorsed by Levitt and Dubner. The thrust of their research as economists involves focusing on solving small problems that have huge implications.

“The economic reality of research funding, rather than a disinterested and uncoordinated scientific consensus, leads the models to approximately match one another. It isn’t that current climate models should be ignored, Wood says—but, when considering the fate of the planet, one should properly appreciate their limited nature.”

This quote shows the essential drawback of the current scientific funding model, suggesting that the model depends on what can garner the most positive attention from potential donors. For this reason, less popular ideas are dismissed even when they could be revolutionary.

“Certain new ideas, no matter how useful, are invariably seen as repugnant.”

This quote illustrates the main problem faced by innovators like Semmelweis. Convincing humans to adopt new behavior is a complicated prospect, even when such a change is beneficial. The authors also contend that changing human behavior is almost impossible when the benefits are more subtle.

“There is a whole different breed of economist out there—microeconomists—lurking in the shadows. They seek to understand the choices that individuals make, not just in terms of what they buy but also how often they wash their hands and whether they become terrorists.”

This quote underlines the importance of the research in this book. Microeconomics is often overlooked as a field, since its focus on small issues offers less of a promise of understanding the nature of humanity or the world. However, although microeconomics does not cover topics such as Wall Street bailouts or global depressions, it nonetheless reveals key aspects of human behavior through which the larger world can be more accurately viewed.

“In economics, as in life, you’ll never find the answer to a question unless you’re willing to ask it, as silly as it may seem.”

The authors advocate for their own economic approach through this quote. They favor small-scale, practical studies and experiments for gathering data and coming to conclusions. Likewise, they have a less favorable view of abstract economic theory that may be more elegant and encompassing but can miss crucial, unexpected details that shed light on human motivations.

“The most basic law of economics—that the demand curve slopes downward—held for monkeys as well as humans.”

This quote shows the eerie ways in which the monkeys’ economy of grapes and tokens mirrors the larger macroeconomic world. This quote underlines one of the basic premises of the book: that small economic forces are just as enlightening as large ones.

“The data generated by the capuchin monkeys, Chen says, ‘make them statistically indistinguishable from most stock-market investors.’”

This quote points out one of the central aspects of the authors’ research: namely, that many of the strategies humans use to manage the more abstract aspects of the economy fare little better than random guessing. The authors use the example of the capuchin monkeys to suggest that at a certain point, humans have very little control over their own systems.