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Freakonomics is a book that has been written by two authors namely Steven Levitt and Stephen Dubner. The book is not a fiction book but rather a study on economics basing on the aspects of incentives through the use of the structure of a novel (Gale, 2016). The book is made up of different types of essays that have been combined to examine a wide range of social phenomena. It has been divided into six chapters which are all brought together to show how the systems are making incentives, asymmetry of information and other models of economics that influence the culture of economics (Gale, 2016).
The authors put up the first chapter to introduce the notion of incentives. According to the book, the concepts of incentives entail the mechanisms of influencing people to do good things and on the other hand do minimal bad things. The book goes on in the first chapter to explore how varied groups have been incentivized into cheating. The books also discuss three kinds of incentives which are economic, social and moral which the authors believe that most of the incentive schemes employ the use of two incentives or more in the course of influencing behavior (Levitt & Dubner 2014).
Information asymmetry is discussed in the second chapter of the book. The authors of this chapter explore the strategies that are employed by the contemporary agents in the real estate industry. In the course of explaining the information asymmetry model, the book provides a story of Ku Klux Klan and how they fell. Information deduced in the second chapter of the book asserts that real estate agents greatly benefit from the theory of information asymmetry. Their benefit is attained through the use of a bigger knowledge base whereby they manipulate real estate owners to sell off their properties at a quicker pace by cheating them that the market is compromised (Gale, 2016).
The third chapter entails a critique of the conventional wisdom that is dealing with drugs is very profitable. Also, within the chapter, they make a comparison of corporate America with an organization that deals with drugs. An analysis of the black gangster disciple nation is made in the chapter, and an explanation of its hierarchy and product distribution presented. In their analysis of the gang, they say that the leaders of the gang earn a lot of money while their subjects earn so little even below the minimum wage. This is the same case with corporate America whereby the highest ranking members in big corporations earn so much profit while the lowest in the rank earn so little (Levitt & Dubner 2014).
The most contentious chapter in the whole book is chapter four. According to the book, the reason for a reduction in the number of crimes in the 1990s was due to abortion being legalized and being made affordable for many Americans. An explanation provided by the book is that many abortions are done because the mothers are unable to cater for the children if born. In occasions whereby these children are born, they would be raised up in poor a background which makes them vulnerable to engaging in crime. Therefore, legalizing abortion and making it affordable eliminated this threat. A controlled study is provided using the case of Romania whereby the government made abortion illegal and a generation later there was a rise in crime rate (Gale, 2016).
In the fifth chapter, the authors explore active parenting through an evaluation of data from the early childhood longitudinal study (ECLS). The data had information regarding 20,000 students. According to the authors in this chapter, what matters most for a child’s success is the socioeconomic status of the parents, age and the level of education but not whether a child joins the head start of some of the other malleable factors (Levitt & Dubner 2014).
The last chapter explores whether a name given to a child has an influence on the child or not. Some of the factors that are used in the course of analyzing the theme in this chapter are the success in employment between people with white names and black names. They found out that children with white names were more often chosen for interviews compared to children with blacks’ names. From this, they also found out that people with blacks’ names came from families with low socioeconomic status and the level of their family’s education was also low (Levitt & Dubner 2014).
In conclusion, Freakonomics is a unique book that has employed a unique style of writing to bring out unique economic situation within the society. Through this book, numerous economic issues are discussed in each chapter though they all have a connection. A major aim of the authors is explaining some of the hard economic questions through analysis of research in the course of explaining social phenomena.
Gale, C. L. (2016). A Study Guide for Levitt & Dubner’s “”Freakonomics. Farmington Hills: Gale, Cengage Learning.
Levitt, S. D., & Dubner, S. J. (2014). Freakonomics: A rogue economist explores the hidden side of everything. New York: Morrow.
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