The World Needs More Ninjas

I just finished reading Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. I’d highly recommend it. Freakonomics reminded me a lot of Malcolm Gladwell’s The Tipping Point (which is also a great read).

The basic idea of Freakonomics is that a University of Chicago economist goes through some case studies based on his research that use statistical data to debunk conventional wisdom. For example, based on statistics, a child is almost 100 times more likely to die due to drowning at a house that has a swimming pool than she is to die from being shot at a house that has a gun. So, letting your children play at a friend’s house with a swimming pool is much more dangerous than allowing them to play at a household with guns.

Something else that I found extremely interesting is the economics of drug dealing. He did an extensive study of records kept by a crack dealing organization. Turns out that their system has much more income inequality than nearly any legal capitalistic system. There was a board of directors, each of which makes about $500,000 per year. Below the board were local leaders (think franchisee for a restaurant chain) that bring in about $100,000 per year. Next in the hierarchy were three right-hand men for the local leader whose annual paycheck comes out to about $7 per hour! Then, you have the actual foot soldiers (about 75-100 per local leader) which do the dealing who make…drum roll, please…$3.30 per hour. So a vast majority of those involved in organized drugs are making less than minimum wages even considering that their income is tax-free!

Freakonomics looks at this phenomenon of the drug world in the context of the four significant factors in determining wages for a given job: (1) labor supply, (2) special skills required, (3) unpleasantness of the job, and (4) demand for services fulfilled by the job. (Which, for example, explains why a hooker usually earns more than an architect…for the fourth point, the authors point out that an architect is much more likely to hire a prostitute than vice versa)

They also look at correlations between parenting and the academic progress of elementary school kids. A lot of the correlations are rather rather surprising. The factors strongly correlated with test scores include:

• The child has highly educated parents.
• The child’s parents have high socioeconomic status.
• The child’s mother was thirty or older at the time of her first child’s birth.
• The child had a low birthweight (this is a negative correlation…children with low birthweights do poorer in academics according to the data).
• The child’s parents speak English in the home.
• The child is adopted (another negative correlation).
• The child’s parents are involved in the PTA.
• The child has many books in his home (this is probably an indicator, not a cause, as evidenced in the next list).

And for factors that don’t show a strong correlation with a child’s test scores?

• The child’s family is intact.
• The child’s parents recently moved into a better neighborhood.
• The child’s mother didn’t work between birth and kindergarten.
• The child attended Head Start (the government pre-school program).
• The child’s parents regularly take him to museums.
• The child is regularly spanked.
• The child frequently watches television.
• The child’s parents read to him nearly every day.

Finally, the last thing I wanted to mention was the authors’ study of correlation between names and economic status. It turns our that, many times, children’s names begin in high-education families and then trickle down to being used in lower-education families. So, based on the current list of names that are highly correlated with higher education parents, the book speculates on the most popular kids names a decade from now (the current list is heavily dominated by Hebrew names along with a few traditional Irish ones).

Their speculation for the most popular girl names in 2015: Annika, Ansley, Ava, Avery, Clementine, Eleanor, Ella, Emma, Fiona, Flannery, Grace, Isabel, Kate, Lara, Linden, Maeve, Marie-Claire, Maya, Philippa, Phoebe, Quinn, Sophie, and Waverly (props to all of you who recognize the last name as being from The Princess Bride book ).

Their speculation for the most popular boy names in 2015: Aidan, Aldo, Anderson, Ansel, Asher, Beckett, Bennett, Carter, Cooper, Finnegan, Harper, Jackson, Johan, Keyon, Liam, Maximilian, McGregor, Oliver, Reagan, Sander, Sumner, and Will.

If you found this post interesting, you should check out the book as it has a lot more entertaining data!