Dedication For ELLEN, who has been there for everything, including the books. —SJD For my sister LINDA LEVITT JINES, whose creative genius amazed, amused, and inspired me. —SDL Contents Dedication 1. What Does It Mean to Think Like a Freak? An endless supply of fascinating questions . . . The pros and cons of breast-feeding, fracking, and virtual currencies . . . There is no magic Freakonomics tool . . . Easy problems evaporate; it is the hard ones that linger . . . How to win the World Cup . . . Private benefits vs. the greater good . . . Thinking with a different set of muscles . . . Are married people happy or do happy people marry? . . . Get famous by thinking just once or twice a week . . . Our disastrous meeting with the future prime minister. 2. The Three Hardest Words in the English Language Why is “I don’t know” so hard to say? . . . Sure, kids make up answers but why do we? . . . Who believes in the devil? . . . And who believes 9/11 was an inside job? . . . “Entrepreneurs of error” . . . Why measuring cause-and-effect is so hard . . . The folly of prediction . . . Are your predictions better than a dart-throwing chimp? . . . The Internet’s economic impact will be “no greater than the fax machine’s” . . . “Ultracrepidarianism” . . . The cost of pretending to know more than you do . . . How should bad predictions be punished? . . . The Romanian witch hunt . . . The first step in solving problems: put away your moral compass . . . Why suicide rises with quality of life—and how little we know about suicide . . . Feedback is the key to all learning . . . How bad were the first loaves of bread? . . . Don’t leave experimentation to the scientists . . . Does more expensive wine taste better? 3. What’s Your Problem? If you ask the wrong question, you’ll surely get the wrong answer . . . What does “school reform” really mean? . . . Why do American kids know less than kids from Estonia? . . . Maybe it’s the parents’ fault! . . . The amazing true story of Takeru Kobayashi, hot-dog-eating champion . . . Fifty hot dogs in twelve minutes! . . . So how did he do it? . . . And why was he so much better than everyone else? . . . “To eat quickly is not very good manners” . . . The Solomon Method . . . Endless experimentation in pursuit of excellence . . . Arrested! . . . How to redefine the problem you are trying to solve . . . The brain is the critical organ . . . How to ignore artificial barriers . . . Can you do 20 push-ups? 4. Like a Bad Dye Job, the Truth Is in the Roots A bucket of cash will not cure poverty and a planeload of food will not cure famine . . . How to find the root cause of a problem . . . Revisiting the abortion-crime link . . . What does Martin Luther have to do with the German economy? . . . How the “Scramble for Africa” created lasting strife . . . Why did slave traders lick the skin of the slaves they bought? . . . Medicine vs. folklore . . . Consider the ulcer . . . The first blockbuster drugs . . . Why did the young doctor swallow a batch of dangerous bacteria? . . . Talk about gastric upset! . . . The universe that lives in our gut . . . The power of poop. 5. Think Like a Child How to have good ideas . . . The power of thinking small . . . Smarter kids at $15 a pop . . . Don’t be afraid of the obvious . . . 1.6 million of anything is a lot . . . Don’t be seduced by complexity . . . What to look for in a junkyard . . . The human body is just a machine . . . Freaks just want to have fun . . . It is hard to get good at something you don’t like . . . Is a “no-lose lottery” the answer to our low savings rate? . . . Gambling meets charity . . . Why kids figure out magic tricks better than adults . . . “You’d think scientists would be hard to dupe” . . . How to smuggle childlike instincts across the adult border. 6. Like Giving Candy to a Baby It’s the incentives, stupid! . . . A girl, a bag of candy, and a toilet . . . What financial incentives can and can’t do . . . The giant milk necklace . . . Cash for grades . . . With financial incentives, size matters . . . How to determine someone’s true incentives . . . Riding the herd mentality . . . Why are moral incentives so weak? . . . Let’s steal some petrified wood! . . . One of the most radical ideas in the history of philanthropy . . . “The most dysfunctional $300 billion industry in the world” . . . A one-night stand for charitable donors . . . How to change the frame of a relationship . . . Ping-Pong diplomacy and selling shoes . . . “You guys are just the best!” . . . The customer is a human wallet . . . When incentives backfire . . . The “cobra effect” . . . Why treating people with decency is a good idea. 7. What Do King Solomon and David Lee Roth Have in Common? A pair of nice, Jewish, game-theory-loving boys . . . “Fetch me a sword!” . . . What the brown M&M’s were really about . . . Teach your garden to weed itself . . . Did medieval “ordeals” of boiling water really work? . . . You too can play God once in a while . . . Why are college applications so much longer than job applications? . . . Zappos and “The Offer” . . . The secret bullet factory’s warm-beer alarm . . . Why do Nigerian scammers say they are from Nigeria? . . . The cost of false alarms and other false positives . . . Will all the gullible people please come forward? . . . How to trick a terrorist into letting you know he’s a terrorist. 8. How to Persuade People Who Don’t Want to Be Persuaded First, understand how hard this will be . . . Why are better-educated people more extremist? . . . Logic and fact are no match for ideology . . . The consumer has the only vote that counts . . . Don’t pretend your argument is perfect . . . How many lives would a driverless car save? . . . Keep the insults to yourself . . . Why you should tell stories . . . Is eating fat really so bad? . . . The Encyclopedia of Ethical Failure . . . What is the Bible “about”? . . . The Ten Commandments versus The Brady Bunch. 9. The Upside of Quitting Winston Churchill was right—and wrong . . . The sunk-cost fallacy and opportunity cost . . . You can’t solve tomorrow’s problem if you won’t abandon today’s dud . . . Celebrating failure with a party and cake . . . Why the flagship Chinese store did not open on time . . . Were the Challenger’s O-rings bound to fail? . . . Learn how you might fail without going to the trouble of failing . . . The $1 million question: “when to struggle and when to quit” . . . Would you let a coin toss decide your future? . . . “Should I quit the Mormon faith?” . . . Growing a beard will not make you happy . . . But ditching your girlfriend might . . . Why Dubner and Levitt are so fond of quitting . . . This whole book was about “letting go” . . . And now it’s your turn. Acknowledgments Notes Index About the Authors Also by Steven D. Levitt & Stephen J. Dubner Credits Copyright About the Publisher CHAPTER 1 What Does It Mean to Think Like a Freak? After writing Freakonomics and SuperFreakonomics, we started to hear from readers with all sorts of questions. Is a college degree still “worth it”? (Short answer: yes; long answer: also yes.) Is it a good idea to pass along a family business to the next generation? (Sure, if your goal is to kill off the business—for the data show it’s generally better to bring in an outside manager.*) Whatever happened to the carpal tunnel syndrome epidemic? (Once journalists stopped getting it, they stopped writing about it—but the problem persists, especially among blue-collar workers.) Some questions were existential: What makes people truly happy? Is income inequality as dangerous as it seems? Would a diet high in omega-3 lead to world peace? People wanted to know the pros and cons of: autonomous vehicles, breast-feeding, chemotherapy, estate taxes, fracking, lotteries, “medicinal prayer,” online dating, patent reform, rhino poaching, using an iron off the tee, and virtual currencies. One minute we’d get an e-mail asking us to “solve the obesity epidemic” and then, five minutes later, one urging us to “wipe out famine, right now!” Readers seemed to think no riddle was too tricky, no problem too hard, that it couldn’t be sorted out. It was as if we owned some proprietary tool—a Freakonomics forceps, one might imagine—that could be plunged into the body politic to extract some buried wisdom. If only that were true! The fact is that solving problems is hard. If a given problem still exists, you can bet that a lot of people have already come along and failed to solve it. Easy problems evaporate; it is the hard ones that linger. Furthermore, it takes a lot of time to track down, organize, and analyze the data to answer even one small question well. So rather than trying and probably failing to answer most of the questions sent our way, we wondered if it might be better to write a book that can teach anyone to think like a Freak.* What might that look like? Imagine you are a soccer player, a very fine one, and you’ve led your nation to the brink of a World Cup championship. All you must do now is make a single penalty kick. The odds are in your favor: roughly 75 percent of penalty kicks at the elite level are successful. The crowd bellows as you place the ball on the chalked penalty mark. The goal is a mere 12 yards away; it is 8 yards across and 8 feet high. The goalkeeper stares you down. Once the ball rockets off your boot, it will travel toward him at 80 miles per hour. At such a speed, he can ill afford to wait and see where you kick the ball; he must take a guess and fling his body in that direction. If the keeper guesses wrong, your odds rise to about 90 percent. The best shot is a kick toward a corner of the goal with enough force that the keeper cannot make the save even if he guesses correctly. But such a shot leaves little margin for error: a slight miskick, and you’ll miss the goal completely. So you may want to ease up a bit, or aim slightly away from the corner—although that gives the keeper a better chance if he does guess correctly. You must also choose between the left corner and the right. If you are a right-footed kicker, as most players are, going left is your “strong” side. That translates to more power and accuracy—but of course the keeper knows this too. That’s why keepers jump toward the kicker’s left corner 57 percent of the time, and to the right only 41. So there you stand—the crowd in full throat, your heart in hyperspeed—preparing to take this life- changing kick. The eyes of the world are upon you, and the prayers of your nation. If the ball goes in, your name will forever be spoken in the tone reserved for the most beloved saints. If you fail—well, better not to think about that. The options swirl through your head. Strong side or weak? Do you go hard for the corner or play it a bit safe? Have you taken penalty kicks against this keeper before—and if so, where did you aim? And where did he jump? As you think all this through, you also think about what the keeper is thinking, and you may even think about what the keeper is thinking about what you are thinking. You know the chance of becoming a hero is about 75 percent, which isn’t bad. But wouldn’t it be nice to jack up that number? Might there be a better way to think about this problem? What if you could outfox your opponent by thinking beyond the obvious? You know the keeper is optimizing between jumping right and left. But what if . . . what if . . . what if you kick neither right nor left? What if you do the silliest thing imaginable and kick into the dead center of the goal? Yes, that is where the keeper is standing now, but you are pretty sure he will vacate that spot as you begin your kick. Remember what the data say: keepers jump left 57 percent of the time and right 41 percent—which means they stay in the center only 2 times out of 100. A leaping keeper may of course still stop a ball aimed at the center, but how often can that happen? If only you could see the data on all penalty kicks taken toward the center of the goal! Okay, we just happen to have that: a kick toward the center, as risky as it may appear, is seven percentage points more likely to succeed than a kick to the corner. Are you willing to take the chance? Let’s say you are. You trot toward the ball, plant your left foot, load up the right, and let it fly. You are instantaneously gripped by a bone-shaking roar—Goooooooooal! The crowd erupts in an orgasmic rush as you are buried beneath a mountain of teammates. This moment will last forever; the rest of your life will be one big happy party; your children grow up to be strong, prosperous, and kind. Congratulations! While a penalty kick aimed at the center of the goal is significantly more likely to succeed, only 17 percent of kicks are aimed there. Why so few? One reason is that at first glance, aiming center looks like a terrible idea. Kicking the ball straight at the goalkeeper? That just seems unnatural, an obvious violation of common sense—but then so did the idea of preventing a disease by injecting people with the very microbes that cause it. Furthermore, one advantage the kicker has on a penalty kick is mystery: the keeper doesn’t know where he will aim. If kickers did the same thing every time, their success rate would plummet; if they started going center more often, keepers would adapt. There is a third and important reason why more kickers don’t aim center, especially in a high- stakes setting like the World Cup. But no soccer player in his right mind would ever admit it: the fear of shame. Imagine again you are the player about to take that penalty kick. At this most turbulent moment, what is your true incentive? The answer might seem obvious: you want to score the goal to win the game for your team. If that’s the case, the statistics plainly show you should kick the ball dead center. But is winning the game your truest incentive? Picture yourself standing over the ball. You have just mentally committed to aiming for the center. But wait a minute—what if the goalkeeper doesn’t dive? What if for some reason he stays at home and you kick the ball straight into his gut, and he saves his country without even having to budge? How pathetic you will seem! Now the keeper is the hero and you must move your family abroad to avoid assassination. So you reconsider. You think about going the traditional route, toward a corner. If the keeper does guess correctly and stops the ball—well, you will have made a valiant effort even if it was bested by a more valiant one. No, you won’t become a hero, but nor will you have to flee the country. If you follow this selfish incentive—protecting your own reputation by not doing something potentially foolish—you are more likely to kick toward a corner. If you follow the communal incentive—trying to win the game for your nation even though you risk looking personally foolish—you will kick toward the center. Sometimes in life, going straight up the middle is the boldest move of all. If asked how we’d behave in a situation that pits a private benefit against the greater good, most of us won’t admit to favoring the private benefit. But as history clearly shows, most people, whether because of nature or nurture, generally put their own interests ahead of others’. This doesn’t make them bad people; it just makes them human. But all this self-interest can be frustrating if your ambitions are larger than simply securing some small private victory. Maybe you want to ease poverty, or make government work better, or persuade your company to pollute less, or just get your kids to stop fighting. How are you supposed to get everyone to pull in the same direction when they are all pulling primarily for themselves? We wrote this book to answer that sort of question. It strikes us that in recent years, the idea has arisen that there is a “right” way to think about solving a given problem and of course a “wrong” way too. This inevitably leads to a lot of shouting—and, sadly, a lot of unsolved problems. Can this situation be improved upon? We hope so. We’d like to bury the idea that there’s a right way and a wrong way, a smart way and a foolish way, a red way and a blue way. 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. Our first two books were animated by a relatively simple set of ideas: Incentives are the cornerstone of modern life. And understanding them—or, often, deciphering them—is the key to understanding a problem, and how it might be solved. Knowing what to measure, and how to measure it, can make a complicated world less so. There is nothing like the sheer power of numbers to scrub away layers of confusion and contradiction, especially with emotional, hot-button topics. The conventional wisdom is often wrong. And a blithe acceptance of it can lead to sloppy, wasteful, or even dangerous outcomes. Correlation does not equal causality. When two things travel together, it is tempting to assume that one causes the other. Married people, for instance, are demonstrably happier than single people; does this mean that marriage causes happiness? Not necessarily. The data suggest that happy people are more likely to get married in the first place. As one researcher memorably put it, “If you’re grumpy, who the hell wants to marry you?” This book builds on these same core ideas, but there is a difference. The first two books were rarely prescriptive. For the most part, we simply used data to tell stories we found interesting, shining a light on parts of society that often lay in shadow. This book steps out of the shadows and tries to offer some advice that may occasionally be useful, whether you are interested in minor lifehacks or major global reforms. That said, this isn’t a self-help book in the traditional sense. We are probably not the kind of people you’d typically want to ask for help; and some of our advice tends to get people into trouble rather than out of it. 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). There is nothing magical about this way of thinking. It usually traffics in the obvious and places a huge premium on common sense. So here’s the bad news: if you come to this book hoping for the equivalent of a magician spilling his secrets, you may be disappointed. But there’s good news too: