Conventional wisdom held that violent crime would keep soaring through the.Īre we right to accept the opinions and recommendations of experts? Are there perhaps deeper mechanisms at work that might explain why human beings behave the way they do and why events unfold as they do? In fact, much of the conventional wisdom we have come to accept is false. Beware Conventional WisdomĬonventional wisdom is easy to understand, comforting, and confirms our own preconceived notions-it’s not necessarily correct. The key for economists and for those who wish to move public policy in a certain direction is to harness the power of incentives to make them work toward some desired goal. There are economic, social, and moral incentives, and they all exert a powerful grip on human behavior. For example, it might seem like a great idea to hold individual teachers accountable for their students’ scores on standardized tests-until that incentive drives those same teachers to start cheating on behalf of their students! Therefore, proper incentive design is key, and poorly designed incentives often misfire. They are driven by their desire to get what they want, and they will always look for ways to achieve their ends by the easiest or least-costly means. Simply put, human beings are self-motivated creatures. Throughout, the authors emphasize some key themes. This approach to economics is empirical, not theoretical.

They use economics to, as the title says, “explore the hidden side of everything.” They argue that economic motivations determine much of human behavior, and demonstrate that economic analysis can be applied to a wide range of problems in the real world. When most readers think economics, they think advanced math, complicated models, and subjects like unemployment, the stock market, and the trade deficit. 1-Page Summary 1-Page Book Summary of Freakonomicsįreaknomics: A Rogue Economist Explores the Hidden Side of Everything is the book for readers who run screaming at the thought of cracking open a book with the word “economics” in the title.

Freakonomics by steven d