freaknomics

Concepts In ‘Freakonomics’Incentives are the corner stones of economic lifeThe conventional wisdom is often wrongDramatic effects often have distant, Even subtle, CausesExperts use their informational advantage to serve their own agendaKnowing what to measure and how to measure it makes life simpler

What we shall discuss….

Incentives‘Snob Effect’Information asymmetryConventional wisdom

Types of incentives“Means of urging people to do more of a

good thing and less of a bad thing”

“Economists love incentives”Economic

People respond to in a market place.Ex:-Discounts ,bonus, Fines etc

SocialUrge people to do things in a way tht is accepted by allPresence of friends effects productivity

MoralAppealing to the sense of a person’s “right or wrong”Advertising,Donations,CSR

snob effect“The snob effect refers to the desire to own

unusual, expensive or unique goods”

These goods usually have a high economic value, but low practical value

Mac usersStarbucksDesigner clothesSports carsStamps,Coins

Information asymmetry“One party to a transaction has

relevant information where as the other do not”

Buyers > Sellers Sellers > BuyersCredit market in rural India

Local money lenders V/S banks

Correlation V/S Causation

Abortion and CrimeLegalizing abortion reduced crimeWhere all criminals have gone

Olympics Medals and GDP!A university of south Australia analysis found that one gold medal typically costs a country $ 37 million in training funds.

Unemployment VS Global warming“An increase in a state’s unemployment rate is associated with a decrease in the probability that residents think global warming is happeningHigher unemployment rates are also associated with views that we should do less with respect to policies designed to reduce global warming.

Conventional wisdom“Explanations that are generally

accepted as true by the public or by experts in a field”

Especially around the link between legalized abortion and crime rates

large drop in crime rate in the US from the 1980′s to 2000

What Do Schoolteachers and Sumo Wrestlers Have in

Common?

Who cheats? Cheating schoolteachers in Chicago.

In which explore the beauty of incentives, as well as their dark side—cheating

How Is the Ku Klux Klan Like a Group of real-Estate Agents?

Going undercover in the Ku Klux Klan…Breaking the real-estate agent code: what “well maintained” really means…What do online daters lie about?

In which it is argued that nothing is more powerful than information, especially when its power is abused

Why do drug dealers still live with their moms?

Why experts routinely make up statistics

Mitch Snyder about homeless statistics45 homeless people died each secondMeant to say that 1 person died for every 45 seconds.

conclusion

• The fact is that freakonomics-style thinking doesn’t travel in morality.

• Parents matter a great deal in some regards.• A better life standard helps to bring down the crimes in to certain extend.

Thank you