Saturday, February 26, 2011

Freakanomics, a revolutionary approach?

So I was listening to the mighty 1090AM a few weeks ago when the evening drive guy was going off the reservation and doing a piece on Freakanomics. It was immediately after the Super Bowl. There was nothing in sports worth talking about. This is the infamous dead-zone of sports. Mid-February is the dreaded doldrums of the sports world.

The host was pretty insistent that books like Freakanomics and Scorecasting were fascinating and revolutionary works. I was mildly interested, but not that interested.

Fast forward to last night. I was having a rough time of it after the first dumping event of my post gastric bypass life. I was looking for something--with no food references in it--to take my mind off my guts. Incidentally, a dumping incident occurs when a gastric bypass patient consumes a food with too much sugar in it. The high sugar content causes a nearly immediate dump of the stomach contents into the lower intestines. This causes massive heart palpitations, making you feel like you are having a heart attack. Believe me, it's punishing.

I booted up the PS3, and took a look at the new contents of Netflix. Interestingly enough, there was the Freakanomics video documentary. It just arrived in the shop. I decided to take a look. What did I find?

The hype surrounding this book is utterly hilarious. The foolish hype promises an economist (Steven D. Levitt) taking a 'revolutionary' approach to understanding human behavior at both the individual and group levels. What is this revolutionary approach? Stevie-baby, genius that he is, somehow discovered that people respond to incentives according to their self-interests.

Stop me if I am wrong, but page #1 of The Wealth of Nations begins with Adam Smith saying "It's not to the goodwill or charity of the butcher the baker or the candlestick maker that we owe our sustenance, but to his own regard for his own self interest."

Economics has always been about people responding to incentives according to their own self-interests. It's been that way right since the very beginning. Nothing revolutionary there. This is what they teach you on day #2 of the high school course. What you have is a classic steal-play, with somebody posturing as a revolutionary. The hype is absolutely pure, 100% unadulterated bullshit.

Why, then, did this book gain such a response? It is good question. Well,,, the quality of education varies throughout the nation and the world. Not everyone has his or her antennas up during high school. Perhaps these benighted fools didn't understand what they were being taught in high school economics. Perhaps they were unfortunate enough to attend a lousy school were there was no training in economics. Perhaps these folks were simply ripe for the plucking by a dude who wanted to write a pop-treatise on economics.

I, myself, am laughing like hell at the so-called revolutionary approach. It's about as revolutionary as a common butter knife.