Freakonomics Rev Ed - Deepstash

An incentive is simply a means of of urging people to do more of a good thing and less of a bad thing.

There are three basic flavors of incentive:

  • Economic

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Freakonomics Rev Ed

Freakonomics Rev Ed

by Steven D. Levitt

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Any incentive is inherently a trade-off; the trick is to balance. For every incentive has its dark side. Whatever the incentive, whatever the situation, dishonest people will try t...

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For every clever person who goes to the trouble of creating an incentive scheme, there is an army of people, clever and otherwise, who will inevitably spend even more time trying to beat it. Cheati...

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Cheating is more common in the face of a bright-line incentive (the line between winning and losing, for instance) than with a murky incentive.

An athlete who gets caught cheating is generall...

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People respond strongly to strong incentives. And there are few incentives more powerful than the fear of random violence - which, in essence, is why terrorism is so effective.

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A group whose power was derived in large part from the fact that it hoarded information - once that information falls into the wrong hands (or, depending on your view, right hands), much of the gro...

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It is common for one party to a transaction to have better information than another party. In the parlance of economists, such a case is known as an information asymmetry. We accep...

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Experts depend on the fact that you don't have the information that they do. Or that you are so befuddled by the complexity of their operation that you wouldn't know what to do with the information...

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It would be naive to suppose that people abuse information only when they are acting as experts or as agents of commerce. Agents and experts are people too - which suggests that we are likely to ab...

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It has become so unfashionable to discriminate against certain groups that all but the most insensitive people take pains to at least appear fair-minded, at least in public. This hardly me...

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  • Taste-based discrimination - one person discriminates simply because he prefers to not interact with a particular type of other person;
  • Information-based discr...

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Just because a question has never been asked does not make it good. Smart people have been asking questions for quite a few centuries now, so many of the questions that haven't been asked are bound...

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It may be sad but not surprising to learn that experts can be self-interested to the point of deceit. But they cannot deceive on their own. Journalists need experts as badly as experts need journal...

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When there are a lot of people willing and able to do a job, that job generally doesn't pay well. This is one of the four meaningful factors that determine a wage. The others are the specialized sk...

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  • You must start at the bottom to have a shot at the top.
  • You must be willing to work long and hard at substandard wages. In order to advance in the tournament, you must prove yourelf no...

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Minor nuisances, if left unchecked, turn into major nuisances: that is, if someone breaks a window and sees it isn't fixed immeiately, he gets the signal that it's all right to break the rest of th...

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A gun is a great disrupter of the natural order. A gun scrambles the outcome of any dispute. Gun advocates believe that gun laws are too strict; opponents believe exactly the opposite.

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The basic reality is that the risks that scare people and the risks that kill people are very different.

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Risks that you control are much less a source of outrage than risks that are out of your control.

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No one is more susceptible to an expert's fearmongering than a parent. Fear is in fact a major component of the act of parenting. A parent, after all, is the steward of another creature's life, a c...

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It's the imminent possibility of death that drives the fear - which means that the most sensible way to calculate fear of death would be to think about it on a per-hour basis.

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That is why experts rely on it; in a world that is increasingly impatient with long-term processes, fear is a potent short-term play.

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If morality represents an ideal world, then economics represents the actual world.

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