Freakonomics

Freakonomics

A Rogue Economist Explores the Hidden Side of Everything

Steven D. Levitt and Stephen J. Dubner

Proxy Trap

Metrics become mirages when optimized directly.

The final outcome of the Chicago study is further testament to the power of incentives: the following year, cheating by teachers fell more than 30 percent.
Polite Conspiracy

Silent agreements to avoid uncomfortable truths.

The agent does not want to come right out and call you a fool. So she merely implies it—perhaps by telling you about the much bigger, nicer, newer house down the block that has sat unsold for six months. Here is the agent’s main weapon: the conversion of information into fear.
Hidden Meters

Building observability changes what you see.

The fee would be added to the parents’ monthly bill, which was roughly $380. After the fine was enacted, the number of late pickups promptly went…up. Before long there were twenty late pickups per week, more than double the original average. The incentive had plainly backfired.
Information Edge

Knowing what others don't creates competitive advantage.

As Supreme Court Justice Louis D. Brandeis once wrote, “Sunlight is said to be the best of disinfectants.” Information is a beacon, a cudgel, an olive branch, a deterrent—all depending on who wields it and how. Information is so powerful that the assumption of information, even if the information does not actually exist, can have a sobering effect.