"Freakonomics" Mr.Steven D.Levitt,Mr.Stephen J.Dubher Business Classics Presentation

1. FREAKONOMICS
By
TEAM NORDSTROM
(Sangeeta, Dhandabani, Munir, Baibhav, Shushil)
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2. Freakonomics
 A new field of study introduced by Steven D. Levitt
(an economist) and Stephen J. Dubner (an award-
winning author and journalist)
 Helpful to reveal, through real life examples, that the
tools of economic research can be useful in the study
of the relationships that underlie the events and
problems that we encounter every day.
 It works by exploring “the hidden side of everything”.
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3. The Hidden Side Of Everything
The book is based on four fundamental ideas:
1) Incentives are the cornerstone of modern life.
2) Conventional wisdom is often wrong.
3) Dramatic effects often have distant, even
subtle, causes.
4) "Experts" use their informational advantage
to serve their own interests.
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4. What Do Schoolteachers and Sumo Wrestlers
Have in Common?
 Significant percentage of teachers helped their
students to pass the annual standardized tests.
 The system provides incentives to schools and
teachers whose students get high scores.
 Incentives scheme in Sumo wrestling makes it highly
prone to cheating.
 To maintain his ranking, wrestler needs to win at
least 8 victories out of 15 every year.
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5. Ku Klux Klan & Real-Estate Agent
 The Ku Klux Klan and real estate agents have
one thing in common both use information
to gain power over other.
 The Klan was and still is a secret terrorist
organisation, who believed that Black
Americans were inferior and used terror and
violence against blacks, Catholics and Jews to
preserve “ the American way of life”.

6. Ku Klux Klan & Real-Estate Agent
 The real-estate agents always use code words
which have different meanings like KKK.
 Like real-state agents insurance agents also
follow same strategy to use information to
gain power over others.

7. Why Do Drug Dealers Still Live with
Their Moms?
 In a Chicago neighbourhood gang the
leader (who's now in jail) made
$100,000 a year (tax free) over four
years.
 His officers made only $700 a month
and his foot soldiers made only $3.30
an hour, less than the minimum
wage.
 They had no choice but to live with
their mothers.
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8. Where Have all the criminals gone!!!
 The central theme: To figure out the reason behind
sudden decline in the crime rate!
 Is that because of - Innovative policing strategies,
Increased reliance on prisons, Changes in crack and
other drug markets, Aging of the population,
Tougher gun law, Strong economy , Increased
Number of police or Other measures like increased
use of capital punishment ?
 It is because of the legalization of abortion which
made the crime rate to go down.

9. What Makes A Perfect
Parent?
 In 1983 T. Berry Brazelton
“Beautifully prepared for the role of
learning about him or herself and the world
all around”
 L. Emmett Holt saying that the baby is not a
“Plaything”

10. More Dangerous
 Swimming pool and Guns
 Flying or Driving
 Risk = Hazard + Outrage

11. Perfect Parenting, Part II; or: Would a Roshanda by
Any Other Name Smell as Sweet?
 The main theme of this chapter circles around the
prevailing African-American culture in the United
States.
 The individuals with distinctively black-sounding
names tend to achieve lower attainment with regard
to education, social class, and economic status
compared to non-black-sounding names.
 “Does the prevailing black culture in America reflect
the economic gap between white and black people
or has it caused the gap to widen?"

12. Perfect Parenting, Part II; or: Would a Roshanda by
Any Other Name Smell as Sweet?
 The authors try to explain how previously obscure
names become popular among white Americans.
“If we only know how to ask the right questions, the
modern world, despite a excess of confusion,
complication and blunt deceit, is not impenetrable, is
not unknowable…”

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