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- [00:00]
A
Hello, everyone. It is my pleasure to welcome you to the London School of Economics for this event with Freakonomics co author Stephen Dubner. My name is Tim Harford. I am a journalist for the Financial Times, broadcaster with the BBC, author of books such as the Undercover Economist. It is my duty to tell you all kinds of tedious things such as don't let your phone ring in the middle of the conversation, but please do tweet incessantly. I mean, I actually disapprove of tweeting while listening to talks. I would suggest that you take notes and then tweet afterwards, but it's really up to you. The hashtag is LSCdubna. The fire exits are basically where you came in. They're up there. They are there. This may possibly be podcast with a bit of luck. If the technology works out. I'm legally not allowed to say there will be a podcast because otherwise the LSE might get sued. I'm supposed to tell you what department of the LSE represent, actually all of this kind of stuff. They sent me a whole stack of stuff. Even the MMs, the brown M&Ms, they send me loads of details. And I'm also supposed to tell you about the order of ceremonies. So I am going to ask questions of Stephen for about half an hour and then you are going to ask questions of Stephen for about half an hour. We are going to finish promptly at 6 o' clock because there is another event here. And that event, by the way, in case you wish to stay for the double bill, features Lord Desai talking, talking about his book why Economists Failed to Predict the Crisis and How to Prevent the Next One. In discussion with Tim Besley, Stephen King and Charles Goodhart. Tim Besley, actually LSE professor, member of the Monetary Policy Committee, went to my school. So not only am I not the most successful economist to go to my school, I'm not even the most successful economist called Tim to go to my school. There we go. But enough of my troubles. We are here. We're here to talk to Stephen Dubnow about his troubles and about his book when to Rob a Bank, which he's written with Stephen Levitt. They have written a number of books under the Freakonomics brand. After the discussion, Stephen will be signing copies of the book. Sure, ideally, if you pay for them, but, you know, you can steal them as well. I'm sure Levitt would approve of that, even if you wouldn't. Dubner. About 12 years ago, there was a profile published in the New York Times Magazine of a Chicago Economist called Stephen Levitt. This was back in the day when nobody really paid any attention to economists for good reasons or for bad. The profile was absolutely masterful. It was, as a writer, exciting to read. It made Stephen Levitt seem like a very exciting person to know. And out of that profile, which was written by Stephen Dubner, the man who sits here, came Freakonomics, Super Freakonomics, Think Like a Freak, the Freakonomics blog, Freakonomics podcast, the Freakonomics T shirts, and various other Freakonomics related things. Stephen, it has been a long time.
- [03:29]
B
This feels funereal somehow. Am I since you first met?
- [03:32]
A
Well, you know, laudatory, perhaps, not funereal. Do you remember the first time you met Levitt, and were you excited about meeting him at first?
- [03:41]
B
Oh, absolutely not. No. So, yeah, so I'll tell you the story. So, first of all, thank you for being here, and I'm really pleased to be here with Tim, who. Whom I've known almost as long as I've known Levitt. We actually met via a Levitt piece that you were writing not long after the events that you just described. So can you hear me okay? Yeah. So I was working. Excuse me. I was working on a book at the time about sort of about economics. It was about what I called the psychology of money. And I was very taken with the notion that money is one of those things that people have very emotional responses to and often make decisions about that are not purely rational. And so I would put money in a category, kind of religion. Ish. Sometimes kind of sex, sometimes these things that we think we know the way they work, but we often make decisions that run contra to that pure knowledge. So I was working on this book, and I was spending a lot of time with economists and psychologists and people like Danny Kahneman and Richard Thaler, who have become, you know, these. These pillars of what's now known as behavioral economics with a lot of other people as well. And my editor at the New York Times Magazine asked if I would write a profile of this economist at the University of Chicago named Steve Levitt, who had just won an award, the John Bates Clark Medal, which is a very prestigious academic award, kind of a junior Nobel. It's quite predictive of Nobel winners. And I knew Levitt's work a little bit. He'd written a very controversial, newsworthy paper about the relationship between legalized abortion and crime, which had been in the newspapers in the States a couple years earlier. But he had nothing to do with money at all, which was what I was focusing on. So in my infinite wisdom, I turned down the assignment from my editor not once, not twice, but three times. He kept asking me, so this is how responsible for my own success I am, which is to say zero. It's all luck. And then I was going to be out in Chicago anyway for a different purpose, and I thought, you know, that's where Levitt is. Let me look up a bunch of his other papers and read them. And I began to read Steve Levitt's other papers that were bizarre and interesting. And he was curious about the world in a way that I as a journalist, always like to think of myself as being curious about the world and didn't really seem to care much whether other people thought that his stuff was interesting. He was interested in it.
- [06:06]
A
There's things like sumo wrestlers cheating.
- [06:09]
B
Exactly. Baby names, estate agents, you know, stuff that I wouldn't have recognized as economic. So I went out there to write about him. The way Levitt tells the story is totally not true. Let me just say, if you ever hear Levitt tell a version of the story, he'll say that I lied by saying that I. I wanted to interview him for a couple hours. Actually, I probably did say that, but I left it open ended. Anyway, I went out. He thought it was going to be a kind of quick in and out newspaper interview, but I was writing a magazine profile, which, if you write a magazine profile of a person, you'll often spend several months on it, interviewing the person several times, other people related to them and so on. So I spent about three days with him that first time. And I remember calling my wife back at home in New York after the first night, maybe the second night, I think the first night. And I remember telling her, you know, I don't know if anybody's going to care at all about this article that I'm going to write, but it's going to be a blast because, you know, as a writer, there are. You can write about things, you can write about people, you can write about places, you can write about events like politics and crime. But writing about ideas is what's exciting. And Steve Levitt was like I was as a writer. He was into ideas within an economic framework. So after that first few days, I was very, very excited, even though I hadn't planned on being excited. Then I wrote this article that you described. People were interested in a book and me writing a book about him, which I thought would have been silly because I just wrote a magazine piece. I wouldn't want to write a book about an economist. Other people wanted him to write a book about his work. He didn't want to do that because he's not a writer. So the two of us teamed up, and that was, you know, a little over 10 years now. And honestly, it's been kind of easy going since then.
- [07:55]
A
I mean, it has kind of dominated your life, or it seems from the outside, it's dominated your life. And, I mean, you did a lot of interesting things before you met Levitt. You were writing New York Times Magazine pieces, I think New York magazine pieces. You were. You were in a rock band. And then since then, just stuff like that, you know. Since then, you've written a children's book and some of it. But you wrote a couple of books as well before Freakonomics that were. At least one of them was quite successful. Do you feel it's kind of. Are you done with it? Because it's been 12 years now, and it's almost impossible to do anything other than Freakonomics books.
- [08:34]
B
Yeah. So I can see why people would think that. It seems like a long time to do a thing like, you know, if I were, you know, a director, writer, or an actor on a TV show that was running for 10 years, I'd say, like, God, get me off, you know, anything but this. But. But. So the short answer is no, although it has taken different forms. So now, honestly, I spend most of my Freakonomics energy these days on our podcast, Freakonomics Radio, which I'm just curious. I know in the States it's popular. Do people. How many. Raise your hand if you know the podcast. Okay. Wow. Okay. A lot. So it's good, isn't it? Yeah. All right, so thank you, first of all, and I really like that. And so I don't know if. So you guys would be a good audience to ask, since you're Freakonomics fans and you listen to the podcast. Do we do a good job of making it seem that Levitt likes doing the podcast more than he actually does? So what I mean by that is, so, look, Levitt and I really love him. We have a great partnership, we have a great friendship, but we have pretty separate lives. A, I live in New York, he lives in Chicago. But also, he doesn't want to be a writer. He doesn't want to do radio. He wants to do economics and consulting and play golf. Golf is a shared passion. But the way the podcast works is. So I kind of do the podcast. Like, I kind of come up with the ideas and then figure out who we're going to have on them, and Then interview the guests, and we edit and write the script. It's very labor intensive. And with Levitt, I'll interview him, like, basically once a month for an hour on, like, three or four or five different topics. But he's so good that even 10 minutes of him on one topic is better than most people's. An hour on that topic. And then we slice him into all these episodes that make it seem as though he's really working hard on the podcast. So plainly, we have you fooled. Yeah.
- [10:20]
A
So the question is, can you tell? Put your hands up if you can tell. Okay.
- [10:26]
B
He seems like a real.
- [10:27]
A
I can tell, but I know Levitt, so. Yeah.
- [10:30]
B
You also know how sausage gets made, generally. A little bit. Editorial sauce. A bit. But in answer to the question. Sorry. So Freakonomics Radio, to me, is really fun because. Because it's applying this idea or this worldview to any topic. But also, I am starting a new show. So there is a podcast episode that we put out called Tell Me Something I Don't Know, which was a game show that we piloted last year. It's actually going into the podcast stream again tonight as a repeat, because I'm here and we couldn't do a new show while I'm here. And so that's something that I really want to. It is very much in the spirit of British panel shows and chat shows. And that will be. It's not related to Freakonomics, but to me, it's a little bit derived from the DNA of it, so that's different enough for me. Yeah.
- [11:17]
A
Do you get a kick out of the fact that you have played with these different formats? You've got the children's books, but even within the Freakonomics sphere, you've got the book, the blog post, you've got the podcasts and speeches. Does that keep it fresh?
- [11:31]
B
Yeah, it does. I mean, I, like a lot of people, get easily bored, so. Also, writing books is hard. I mean, you write books. It's writing a. Trying to write a good book. I mean, everybody tries, obviously, to write a good book. You're not always successful, but trying to write a good book is an extremely. I was going to say rigorous. That's not quite the right word. It's a draining experience because it's such a big piece of writing that your mind always has to be in gear. You really need to keep the parts related to each other quite well. And it's the kind of commitment of a year or two or three years that is unlike anything I've ever done. Parenting, I think is also very challenging and hard, rewarding. But there are many more ebbs and flows, whereas the book just feels like a big pile of rocks that you carry on your shoulders and in your brain. And then finally you get to set it down, hopefully in a little bit better shape than when it started. So writing books only would really kill me. And I've always liked having. I also am a big believer in quitting things when they. Like the minute you start to feel like you're not as good at them as you used to be or that it's stale for you. So I did. I was in a rock band. That was my first career, and I quit that right about six months after we signed a record label. So, like, I worked on it for five years and got successful and.
- [12:57]
A
And you talked to Bruce Springsteen.
- [12:58]
B
I did talk to Bruce Springsteen, yeah.
- [13:00]
A
And he told you to quit?
- [13:01]
B
He didn't quite tell me to quit, but he was one of the people who were successful that I got to talk to as we were rising, and I got to observe what that life is actually like. And that was when I realized that fame, which is this thing that would seem to be appealing to most people and that would seem to be wonderful if you get it, is, in fact, very costly. Now, power and money, those things are a little bit different. But fame itself, I think is very, very, very costly. And it wasn't like we were guaranteed to become famous if I stayed in the band, But I just decided I didn't want that life. So I quit after doing that for five years, and I got to the New York Times, which I loved, and I did that for four or five years. And I quit because, honestly, I quit there because I didn't want to be an employee anymore. It was a great job as a journalist, but I didn't like being someone else's employee. I wanted to be my own thing. And so that's when I started to write books. So, yeah, I think that everybody should quit all the time, what they're doing if they're not. Not successful, Happy as long as. I mean, it's easy to say that as long as you're not leaving a bunch of broken hearts or stray children or animals in your wake.
- [14:19]
A
But we don't talk about that. Tell us about the new book.
- [14:24]
B
So the new book is a compilation of the greatest hits of our blog for 10 years. So when we were getting ready to publish Freakonomics, we had no idea. We assumed it would fail because most books fail. I mean, if you could meet on the Street 100 authors, we would be two of the few whose books happen to not fail. Now, I would argue that some of it, no offense to you, is luck, because a lot of people write very, very good books. Most of my friends in New York are writers, and they're very good, they're very well educated, they work very hard. But there's something like 250,000 books a year published in the States. So how many? You know, even if you're a big reader, you read maybe 100 books a year. So you personally are failing those 249,900. Right. So when Freakonomics came out, we expected it to fail, but we thought, until it fails, let's pretend that we're really trying hard to support it. So we set up a website, because that's what you do. And we had some chapter excerpts and so on. And then the webmaster who set up the website said, you know, there's a blogging function on this website. I think it was WordPress at the time, or Blogger. It was Blogger at the time, maybe. And we said, what's a blogging function? So I kind of knew a few blogs. Marginal Revolution was around then, and a few others. And so we started blogging. And once the book came out, we really loved blogging because people then write to us and say, I read the thing you wrote about baby names or about estate agents, and here's why you're wrong, or here's a story I have that supports what you wrote. And it was so fun to have a live forum on which to interact with readers. And then it quickly became more than that, where Levitt and I would just routinely, daily, often we'd write three or four or five posts a day. We would just write whatever we felt like it. And we did this for 10 years. And at the end of 10 years, which is now, there were 8,000 blog posts, which is enough to publish probably about 30 really bad books worth of blog posts. So rather than publish 30 bad books, we decided to triage down to one, hopefully good one. So we ended up editing. I think there are 132 blog posts out of the 8,000 that range from everything we've ever written about. Crime, politics, baby names, sex, a little economics along the way, sports, cheating in praise of cheating.
- [16:44]
A
I seem to remember the first blog post, maybe not the first blog post, but the first blog post, once you went onto the banner of the New York Times, was Levitt brainstorming about how to stage a terrorist attack on the United States dates and asking for ideas. And.
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B
That Was a very popular post. Yeah, yeah.
- [17:06]
A
Got some attention. Sometimes I wonder, you guys just trolling? I mean, is it you just. Just looking to wind people up?
- [17:16]
B
You know, it's funny.
- [17:17]
A
Or does it come naturally to Levitt?
- [17:20]
B
I actually think. I don't know. For Leavitt, it's funny. I haven't read the original article I wrote about him in a long time, but I saw recently a chunk of it, and there was a line where I described him as something like, he looks nothing at all like that. He's an intellectual flamethrower, but he doesn't appear at all. He's the most boring looking human. He just looks so average. He doesn't look angry, his eyes don't bulge out. He's not disheveled. He doesn't particularly care what anybody thinks about him or how he looks or anything. He's just very. Just very kind of unassuming in every way. And you wouldn't think that he's at all a flamethrower type. And yet almost every other thought that comes out of his mind runs contra to what everybody else believes in the world right now. Part of that is training, like an economist, where you're trained to look for efficiencies and optimization and so on, but you're also trained to not really factor in all the soft, squishy things that so many people, including politicians and the media, are consumed with, like emotions. Right. So if you can turn off all emotions, you can have some really unique ideas. And I think that's really what he. What he taps into. So with the post about terrorism, like, he couldn't understand why is it a big deal? It's like, if we're the US and we're under some terrorist threat, wouldn't it be nice to have a better idea of what kinds of attacks there might be? Well, there aren't that many terrorists out there. There are a lot more good people, honest people, readers of Freakonomics blog, than there are terrorists. Why don't we just ask all of them what their ideas for terrorism would be if they were a terrorist, and we could assemble that into a body of knowledge that we could then treat as kind of, you know, something worthwhile, Some data that you. But again, most of the world didn't see it that way?
- [19:20]
A
No. Were there any blog posts that you. Or even book chapters or things that you wrote that you, in retrospect, wish you hadn't?
- [19:33]
B
Do you have any in mind, perhaps? I can't think of anything. You know, I'll tell you one. I'll tell you one, and this is a weird one. This is like a double. This is like a double whammy. So in our first book in Freakonomics, we wrote maybe half a chapter, maybe a third of a chapter, half a chapter about this guy named Stetson Kennedy, who was a civil rights activist in the early days of civil rights in the United States, so starting during the late 1930s, I guess. And he was a white Southerner who was very against racism. And he ended up doing a lot of things toward that end. And one of the things that he did was he went undercover in the Ku Klux Klan. You guys know the Ku Klux Klan? Yes, even. Yeah, he went undercover in the Klan and later then disseminated a lot of their secrets, essentially, and their procedures and wrote a book about it all in an attempt to declaw them, defang them. And we wrote in this chapter for economics, we wrote about him, Levitt and I, and another economist named Roland Fryer, who's a fascinating, very, very brilliant young economist, went and spent some time with Stetson Kennedy in Florida. And we wrote about him in a chapter, I think, called something like, what do real estate agents in the Ku Klux Klan have in common? Or what do estate agents in the Ku Klux Klan have in common? Which, believe me, one as many more enemies from real estate agents than from members the of to the Ku Klux Klan. And the argument was very simple. It was a chapter about information asymmetry. It was about the fact that when there are two or more parties in a transaction and one party knows a lot more than the other, you can exploit that or abuse that in some way if you want to. So estate agents, the data seems to argue, do that. And what Stetson Kennedy did was by disseminating the secret information about the Kuwait Ku Klux Klan, their passwords, the way they operated, the way they gathered dues, the way they made money and so on, we argued that that robbed them of their information asymmetry, essentially. It took away the secret power of all that they did. And it kind of helped bring them down. It wasn't the only thing, but it helped. So anyway, this is what we wrote. This was based largely on interviews with Stetson Kennedy, books that Stetson Kennedy had written, but a bunch of other histories of the Ku Klux Klan that had been written that included Stetson Kennedy. Well, shortly after the book was published, I heard from a fellow who was a writer in Florida, a journalist, a very good journalist who'd been working on a project with Stetson Kennedy related to civil rights, but not having to do with the Klan per se. And he told me, he warned me, that Stetson Kennedy had exaggerated a lot. And he encouraged me to reconsider what we'd written in Freakonomics and that it wasn't 100% kosher, that it wasn't 100% truthful. And as I began then to peel further, I realized that all the history books about the Klan that I had relied on, that their source was also Stetson Kennedy himself and Stetson Kennedy's own books, which is, unfortunately, the way it often happens in history. And then I began to go to all different sets of archives, some in New York and some elsewhere, because he'd been a kind of double agent for a number of law enforcement and civil rights agencies. And it turns out that what he seemed to have done was not himself infiltrated the Klan, as he said, but befriended someone who did. And then this someone fed him information. And then when he, Stetson, wrote a book about it, he acted as if he were the one who did it. So on the one hand, you could say he's still heroic because the aim was to change the power structure of the information, or you could say he was a little bit fraudulent because he pretended to be the hero himself when he really wasn't. So this was very disconcerting to discover it. And so I did what you do in this situation when you're a journalist, which is you call up. Actually, I wanted to talk to him about it in person. So I flew down to Florida and I met with him. It was very uncomfortable. And I ran this whole scenario by him, and I got a bunch of very, very, very unsatisfactory answers. And this guy was 80, 82 years old. Now he's like a state treasurer in Florida. And ultimately, because his answers were very, very unsatisfactory and couldn't convince me that he hadn't been embellishing a lot, we decided that the right thing to do would be to write a column in the New York Times that said, here's what we wrote in our book and here's what we believe really happened and let the record be corrected, that was the right thing to do. But I remain conflicted about it to this day because I think it ended up causing him more pain than he deserved, if that's the right word. I don't think there was any optimal solution out of that. But in my zeal to correct what I think I felt was seen as our mistake, I launched a corrective address that I think assaulted him more than was warranted. And that's something I don't feel great about. He died a few years later.
- [25:00]
A
So you regret the correction more than the original story?
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B
I regret the medium of the correction, the New York Times. You know, in retrospect, what I wish we had done is in future editions of the book, just shifted the language to make his claims of heroism seem less so. But I felt, you know, the book came out. It was a very, very, very prominent book. I felt the right thing to do was to correct the record as prominently as possible. And I'm still not sure I'm wrong. I'm just saying, if you ask me if there's anything I regret writing, that's one that I still think about a lot. Because the pen or the typed word is still remarkably. It's a huge amount of power and privilege and leverage that we have, those of us who write for, whether it's established media, our own media, your own Twitter and so on. It's remarkable how much leverage the printed word has. And you just have to take it very, very seriously. And that's the case where I took it seriously and I maybe zigged a little bit where I should have zagged.
- [26:00]
A
It is an interesting debate in journalism. There have been a number of high profile cases of writers and journalists who have been caught committing journalistic sins of various severity, from absolutely fabricating stuff to lifting chunks of their own material and kind of regurgitating it or lifting chunks of other people's material. And every time we had the recent case in Rolling Stone of a report of a college campus rape that later turned out couldn't be verified according to one source.
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B
It was a single source story, which is what we had too, by the way. I mean, that's.
- [26:45]
A
You had a single source, Joan Oleira, whose books were pulled after he was caught basically ripping himself off. But also then it turned out he made up something that the Dylan, Bob Dylan hadn't said.
- [27:00]
B
It's almost hard to make up anything that Bob Dylan hasn't said. He said so much.
- [27:03]
A
Yeah, yeah. So I'm trying to figure out, have we got too precious about this? It seems every time this happens, it's very important to get your facts right. Every time this happens, somebody says this is all Malcolm Gladwell's fault. Even though I've never found Malcolm Gladwell to have got anything major wrong. But this idea that the story has become more important than the truth in writing. Do you think people write.
- [27:33]
B
I think that's a very narrow and modern notion. I mean, look, we're a couple hundred yards away from Fleet Street. I mean, you think that the articles that were in the fleet street newspapers 100 years ago are any more factual than what's in a nonfiction book today? Absolutely not. I mean, journalism. I mean, look, I love journalism. It's what I did for many years. It's what I consider. I still do. I just don't write for a newspaper. But no, I think the standards and ethics of journalism generally are excellent and have mostly gotten better over the years. I think it's a little. It's just when people get all agitated about these instances of plagiarism, even if it's self plagiarism, many of which are not. Though I think it's a little bit naive when people get super excited and treat it as if it's A, necessarily a cardinal sin and B, something we haven't seen before. But that just plays into the. That's just the way we treat a lot of news these days. We get overexcited about things that aren't really that big a deal. So it's wrong to plagiarize without question. But I don't think it's indicative of any great intellectual collapse on the part of all Western writers.
- [28:37]
A
That's reassuring to hear. I'm going to turn to the audience and ask for questions in a second. But before I do, I just want. I imagine that there are various people who've come here because they admire your writing and would like to become writers themselves. And I wondered if you had any. This is a really cliched question, but one, it's a cliche because it's a popular question. Would you have any advice for someone who perhaps is interested in economics and would like to turn that into a career as an economics writer or an economics journalist?
- [29:09]
B
Well, if that's. Is there anybody that describes in here who's willing to raise their hand? Never mind that.
- [29:18]
A
Nobody'S interested. You know, that's a good response. No one's interested.
- [29:23]
B
I do find that whenever I talk about writing, which I care about a lot. Nobody cares so.
- [29:29]
A
Well, people do care about sports.
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B
Yeah.
- [29:32]
A
And so I have to ask you before I turn to the audience, there appears to be.
- [29:37]
B
Oh, yeah, yeah.
- [29:39]
A
Something behind you, and I want to explain this.
- [29:41]
B
Can I just tell you a quick story that's slightly tangential, but not so. We get a lot of emails sent to the Freakonomics address and we read them, read them all. Don't respond to, you know, all of them. Can't do that. But, you know, we really and it's a great. And I'm guessing that there are those of you in the room who've written to us and I hope that maybe we responded, but it's a great, It's a thrill. People write with their questions, with their problems, with their complaints, whatever, and sometimes with their proposals. And most of the proposals are ridiculous. It's, you know, will you write my son's high school graduation speech? Because he really likes your book but he's lazy, so that's gonna be a. That's going to be enough. And then sometimes the proposals are so absurd that they turn out to be great. And so I'd like to tell you about one such case where I got an email a couple six, eight months ago from a fellow in England who said that he is the social media director for a football club called FC Dun Cow, which is in Shrewsbury, which is, I believe, a fourth division Sunday league club. And he said that they were looking for a new sponsor for their football club and would Freakonomics or Freakonomics Radio be interested. So my initial reaction was probably nah, because, you know, my initial thought, you know, so I'm not an economist, but I've hung around them long enough to have to think like them a little bit. So initial thought is what's in it for me? So what's in it for me to sponsor, you know, a fourth tier Sunday league football club? Probably nothing, but I have a son who, who is a football nut. Okay, absolutely a nut. And his main team is Barca, but he follows British football quite closely. So I thought, you know, maybe it'd be something worth thinking about. So I wrote back to this fellow and I said, well, what are you looking for? And he said, £1,000. I thought £1,000 to sponsor a club for a year is not outside the realm of, you know, sanity. And then we began to communicate a little bit more about this club. And then as it turns out, my son and I were going to be in England to watch some football on our spring break. So I asked if we could get together with this fellow from Shrewsbury and he said, well, I'm coming down to the same match they were coming, the same match we were coming to, which was England Lithuania at Wembley, the Euro qualifier. So we met there.
- [32:12]
A
Similar standard to FC Dunkow.
- [32:16]
B
I think Dunkow could take Lithuania, actually. They're very tall, but they really don't move without the ball at all. All. And so as it turns out, the fellow who had written to me, his name is Alex Simpson and he was only a Year or two older than my own son and he is the social media director and assistant linesman of Dun Cow. And his dad, Paul is the manager of Dun Cow. So first of all, they are here today. Alex and Paul, where'd you end up? Here we go, right here. Alex and Paul now. And when I realized that Alex had written to me, how old were you when you were 15 or 16? What do you know? I'm still 15. You're still 15. So Alex, who is still 15. So I thought if a guy like that can be so industrious to track down a guy like me and say, hey, do you want to sponsor a club? And he's 15. You know, I think a lot and we write a lot about Alex. Altruism and charity, you know, what do you do if you're lucky enough to have more than enough to feed your family and so on? How do you think about helping others? And there are a lot of different models. I'm a big believer in helping people who like to help themselves. So I thought, man, if there's a 15 year old kid who is not only a social media director, assistant linesman, but is also lining up sponsorships for his football club, I want to get me some of that. So I am proud to say that as of the new season, beginning in September, Freakonomics Radio is the official sponsor of Gun Cow Football Club. Okay, so well done, Alex and Paul. And today, just moments before I came on stage, I was presented with the jersey. Okay, so we'll see what you. Here we go.
- [34:20]
A
So can you play yourself, Stephen?
- [34:23]
B
I can play myself, yeah, if you need the aging hobble. So seriously, I'm just. Look, I'm happy it worked out. I like these guys a lot. But I think it is a lesson, like if you have something that you want to accomplish, even if it seems absurd, perhaps objectively absurd and maybe absurd to everyone around you, give it a shot. You never know what's going to happen. So I'm sure some of you are students who are getting ready to go out into the job market. Write the letters to the people that you really, really, really, really want to work with because you just never know what might happen.
- [35:00]
A
Write to Steven. Don't mind to me. Now it's time to take questions. Maybe we could take two or three because we haven't got loads of time and we'll cluster them. If you, if you would like to put your hands up if you have a question you would like to ask Stephen about geoengineering, about sumo wrestlers, about the business of podcasts, prostitution, anything really. So we've got a question there. If we get a microphone, there is a lady up there. So here and then there. Thank you.
- [35:37]
C
Hello.
- [35:38]
B
Thank you for the talk. It was very enlightening. So I was wondering, like, clearly you.
- [35:43]
C
Talk in your books and podcasts about.
- [35:45]
B
Loads of different stuff. How do you come up with all.
- [35:48]
C
These different bizarre things to talk about?
- [35:50]
B
And as you, as time goes on.
- [35:52]
C
Do you find it difficult to keep.
- [35:54]
B
Finding, like, varied topics to write about?
- [35:59]
A
Let me take another question. So, yeah, where do you get your ideas from? And lady with the mic. Yeah.
- [36:05]
D
May just say that rebroadcasting the podcast about failure and, you know, accepting failure just before exam time in the UK is not the best idea ever. Aside from that, obviously with Freakonomics, you're trying not to just give us packets of knowledge that we can take home. You're trying to teach people a way of thinking. And I see a trend in trying to almost debunk knowledge that is already we take for granted and we think that it's done, it's over with, we know it's tradition, it's a way it works, etc. So obviously the Freakonomics crowd and the fans of Freakonomics are a self selected group of people who think in a certain way. The problem is you have a series of podcasts about how the medical profession works in the US and how it's not working. And even though it's continuing to be the same way as it always was, how do you go out in the world and actually change people's minds? How do you kill those ideas as you put it in your podcast?
- [37:07]
A
Thank you very much. And there was one more question right at the back. If we could pass the microphone to the gentleman at the back. Yeah, yeah, just behind you there.
- [37:18]
C
Hello, my name is Petros and I'm a student here at lse. I had a quick question with regards to your background. I find it fascinating that you've kind of delved into this whole world of economics without necessarily having an economics background. And my question is, now that you're surrounded with economists and now that you deal with this field every day, what are some issues that you have with the field itself and critiques, I guess, for aspiring economists or individuals who study it.
- [37:48]
B
Great. Yeah, I like all those questions. So since those are really good questions and maybe we'll even get to another batch, I'll try to give relatively quick answers to each in terms of issues I have with the field. So, yeah, so I've learned A lot about economics by working with Lev and even the book that I was doing before, the research on, not enough to make me remotely an economist, but enough to understand at least a lot of concepts and applications in terms of the issues I have. I think that the field of academic economics does not really communicate well what it knows and what it doesn't know. So I feel that. And I'm not sure if that's the field of economics or just the way it works into the media, but I feel as if most, most average people who are not academics, not economists, not in the media, they hear economists talk about the economy and they want to believe that they know what they're talking about, and they just don't. They really don't. So the macro economy as a kind of instrument that can be well described and predicted, we're just not there yet. And I prefer much more. The reason I like behavioral economics of the last 30 years with Kahneman and Thaler, Kahneman and Tversky, Thaler and stuff like that is because to me it harks back much more to the original economics of Adam Smith. I mean, Adam Smith was a moral philosopher. Let's not forget that. It wasn't about being a mathematician, it wasn't about being a statistician, it wasn't about being a theorist. It was about trying to understand how people's lives are affected when there are big changes. In that case, the industrial revolution. That's the value that I think economics can bring. But I think that way too often. And again, I'm not sure if this is the fault of economists or economics. Economics, it's treated as more a blend of finance and macroeconomic description. And I wish that weren't true in terms of where the ideas come from. You know, I don't have a job. This is what I do. So, I mean, you laugh, but that's really the way it works. So if I were a painter, you know, I would probably spend 80% of my time thinking about the picture and some doing. If I were, you know, whatever. If I were a musician, I'd spend a lot of time thinking. You know, I'm going to practice, I'm going to write, but there's a lot of just thinking. And so really what I do is I just walk around the world thinking about stuff. And I do like to. You know, I was the youngest of eight kids in my family, still am, and I didn't get to talk that much when I was little. So I've been making up for it ever since. Right. But I just Loved listening to the conversation at the table. And even when I was little, I was way too shy to even ask my brothers and sisters questions about something they said. But I just love to try to figure it out. And I think that's the way we all are. We love to figure out the way the world works. So the reason I became a writer is because it gives you permission to go up to total strangers and ask them the kind of questions that you wouldn't be able to ask them in polite company at all. But this is what I do. This is my job. So really I do. I guess I have a lot of ideas relative to you guys. That's because you're all busy doing actual work. If you had no job like me, I'm sure you'd have as many ideas as I do. And the second question.
- [41:06]
A
Question about how you actually change the world.
- [41:10]
B
Oh, yeah. So.
- [41:11]
A
And I have a supplementary question to that, which is, do you think that you have managed to change the world in any important way?
- [41:17]
B
I think we've changed the world in two significant ways, which is paving the way for more books about economics to be published and slightly raising the profile of academic economists. I think those. And maybe encouraging more people study economics in university. But then once they get there and they realize that economics in university is nothing like freakonomics, they become sociologists or psychologists. But in terms of changing the world. So the bad news is, I think we change very little. The good news is we don't really care because that's, you know, because I think the reason that we're able to do what we do, to really be honest, to act as honest brokers. We don't have horses in any race. And the reason we're able to do it the way we do it is because we don't really. We're not trying to advocate for policy necessarily. We don't have a lot of ideologies, we're apolitical and so on. So it's not our intention. You know, if we wanted to. There was one point where I wanted to kind of start a think tank. The Freakonomics Institute, it would be called. But even that wasn't going to be at all ideological. It was going to be a kind of nonpartisan think tank for when there was a big policy issue of the day and the left and the right are fighting about it. We would be the guys to march in and say, okay, let us try to do some research and find out what's really going on. But there was zero appetite for that from anybody, including Steve Levitt. I was the only. It would have been me with my flag. So in terms of whether we've actually influenced anyone substantially, I can't really answer the question. You know, last night I was in the green room of a TV show, Newsnight.
- [42:48]
A
Newsnight, yeah, we've heard of it.
- [42:51]
B
And I was the last guy to go, so they were saving me for the last like 90 seconds of the show. If it didn't work out, it would have been okay to send me home anyway. And so in the green room, right before me was an MP who is standing for head of the Labor Party election, okay? And she was chatting, she was a very good politician. She came up, shook my hand, said, you know, what are you gonna go on? What are you gonna talk about? Da, da, da. She said, what do you do? I said, I write books. What books? Freakonomics. Said, oh, yeah? She said, I read Freakonomics. And she said, shithead, right? And I said, huh? And she said, shithead, the name, the kid's name. I said, oh, Shatid, right? And. And so we had written about how parents sometimes give their children names that are kind of ridiculous, right? And in this one case it was pronounced Shatid. And she said, yeah, shithead. And it was that whole bit about how the name you give your child will really screw up the child's life forever, right? And I just nodded and shook hands. Then she went on to be on the show. So as it turns out, she was. Was totally wrong. What we wrote in that chapter is about how the name you give your child doesn't affect a life's outcome. So here we have an MP who's running for leadership of your country. And what she takes away from what I wrote is Shithead, and it matters on your life when in fact it's Shatid. And it doesn't matter.
- [44:27]
A
So we got a little more time. Any more questions? There is a question there. Can we get a microphone to that lady, please? Anybody else? There's a gentleman there. Anybody else? Otherwise? And this gentleman up there as well. Next, a young lady.
- [44:43]
B
Oh, you're there already? Yeah.
- [44:45]
E
Thank you for your very enlightening lecture. I come from India and we have a huge population that reads Freakonomics. And I understand from reading our books that there's also a deep sociological understanding along with the economics aspect of it, obviously the understanding of the society on which you write. So I was wondering if there's any long term vision of writing something about the eastern society, because there'll be a lot of interesting case Studies. If you look at Japan, China, India, Bangladesh. So is there any long term vision.
- [45:19]
A
Beyond writing about sumos and speed eaters? Could you please pass the microphone to the lady just there? Thank you.
- [45:27]
E
Hello. Just because I think we're all dying of curiosity, is it now a good time to rob a bank? Actually.
- [45:33]
A
Okay.
- [45:34]
B
They're closed, so I'm going to say no, it's not mornings. Mornings are best, FYI.
- [45:39]
A
Very good. Okay. There was a question there. Yeah, hi. A lot of your podcasts and stuff talk about changing behavior. I was just wondering what's the most counter intuitive thing you found out that you've ended up recommending?
- [45:53]
B
Recommending.
- [45:57]
A
There was one more question there. If you could just pass the microphone to the gentleman in the. In the dark shirt. I was wondering, why do you think people misremember or misunderstand the name chapter? Because that's come up before, I think.
- [46:13]
B
In the film as well. Yeah. Okay, so let me answer the Asia question first. Do we have a plan, do we have a plan to write about more, More about the sociological divisions and so on? No, and I kind of regret it. I don't know Asia well at all. I wish I did. I think that if I lived in Europe I probably would write about Asia all the time. But being in the States, I just don't like. We end up writing about Europe quite a bit because we're only one continent removed and there's enough interchange and I'm here enough and I know enough people from here. And I agree with you that what we do is, as some people like to criticize. Well, that's kind of like sociology. And I'm like, thanks, I love sociology. I should also say that Levitt's probably, I don't know about his biggest influence. One of his biggest influences was Gary Becker, the great economist at the University of Chicago, who died not long ago and who did a lot of work, very similar, that really inspired the work of Levitt. And he wanted to be a sociologist first. And the reason he did, excuse me. Is because he thought sociology was better poised to help more people. Simple as that. If you're going to be an academic studying the way people live, you want to figure out how they earn, spend, live with each other, get in fights, love, hate, and so on. He thought sociology was the way to go. The reason Gary Becker left sociology is he didn't feel it was rigorous enough. He didn't feel it was empirical and mathematical enough. And that's why he went into economics. And so I really do think of what we do as very much a blend of economics, sociology, psychology, and those.
- [47:50]
A
Things I read recently. I think it might have been a Krugman essay from years ago, that there's this sort of sense of this hierarchy with the physicists at the top, and then further down you've got the economists, and then further down you've got the sociologists. And the physicists seem to have made the most progress. And it's not because further down the pyramid, the people are getting stupider. It's because the problems are getting harder and harder.
- [48:12]
B
Sociology is the hardest. I consider some of the problems that physicists try to solve pretty hard. But that's because I'm not a physicist. It's funny, I always think of physics as the kind of physical science version of economics in a way, in that they're both a little bit about the engineering of things, about the really understanding.
- [48:27]
A
Physicists would really laugh at that, I'm sure.
- [48:29]
B
Well, you know, Nathan Myhrvold, for instance, who is trained as a physicist, he. I mean, maybe. Maybe my thinking is inspired by him because that's the way that they approach solving a problem, which is kind of figuring out how a system works, what's failing. You're measuring inputs, you're measuring outputs, you're trying to isolate cause and effect and so on. So I do see similar areas there, but I may be totally wrong. Okay, what else do we have?
- [48:52]
A
So we had. Why do people misremember stuff? What is your most counterintuitive recommendation? And then right at the end, I do want to you to talk about robbing a bank.
- [49:00]
B
Sure. So what was the most counterintuitive recommendation? I like that question a lot, but I don't know. I don't know if I. Maybe you guys know better since you listened the podcast, because you probably have listened to the episodes more recently than I made them. Like quitting, I would say was fairly counterintuitive. Hitchhiking, we tell people they should go out and hitchhike. That's not dangerous at all, though. I don't want to get sued if somebody does that and something terrible happens.
- [49:31]
A
Does merely expressing your desire not to get sued protect you against.
- [49:35]
B
Seemed to for you when you were giving the LSE disclaimer at the very beginning. You know, I guess this is not that counterintuitive. We did a little episode, radio episode about what's the best exercise, the answer to which is anything that you don't hate. Because the biggest problem is most people who get to the point where they feel like they should exercise they try to do what they feel they should do, but they hate it, so then they stop it. So basically, anything that you're willing that you like, you'll do, and anything that you do is better than the ones that you won't do. So for me, it's golf, which, even though I'm not a very good golfer and it's not very labor intensive, but to go out and do something for four hours, that's a little bit labor intensive, I figure equals, like, 10 minutes of good exercise. That's the way I justify it, at least.
- [50:22]
A
So I actually remember that podcast. I remember that podcast, but I remember it differently. So I remember the conclusion being squats, because they're big muscles. They. They burn a lot of energy. But also, fundamentally, what do you really. What is your ultimate goal?
- [50:36]
B
To be 80 years old, to be able to get out of your chair. Exactly right.
- [50:39]
A
Go to the toilet, climb the stairs, get out of the chair. And so squats are the best exercise. Which brings us to, I guess, this question of Ms. People misremembering things, because you and I have remembered.
- [50:50]
B
That's right. That's right. So the reason that I. So, first of all, the names thing, I would say that probably 60% of the people who write to us or say something about the names thing misremember it, which is remarkable considering that it's not that hard to remember. It's like, yes, no. And we said no, but they say yes, so it wouldn't seem to be that hard. Okay, so there are two things going on. One is that the film itself. There was a documentary film made called Freakonomics that we. We didn't make it, but we participated in it. And we, you know, we participated in it, and it was. It was produced by one guy. Then there was an overall director, but then four different documentary filmmakers each made one short section, and there was one section on names in that. And that was made by Morgan Spurlock, who made Super Size Me most famously and a bunch of other things. And he's very good, very clever, very funny, very, very charming. So in his version of the film about names, it implied quite strongly that your name really, really does matter. And when we watched the rough cut. So one of the arrangements when you're making a film like this is, you know, you don't get any money or anything. You just say to the people, just don't make us look like total idiots, and let us see it before it goes too far so we make sure there's no mistakes and in it. So in Each of the pieces, there were some things that we asked to be changed. And in none of the cases did the filmmakers actually make any changes. And that's when you realize where you stand in a pecking order. So when you're making a film, the writers, even though we didn't write the script, we were just the writers of the book. Zero leverage. So we said to Morgan, just so you know, the thing where you say that the name really matters, it doesn't. So if you want to, you might want to think about changing that. And he's like, okay, thanks a lot. And nothing got changed. So I think that if people have seen the movie more than read the book, that's one reason why they misremember. But I think the bigger reason that people misremember is because people remember or think or believe what they want to be true. And that, I think, is really at the nub of a lot of our behavioral issues, which is, if you believe that carbs are better for you than anything because you're a bread lover, then you're going to find a way to find evidence that backs that up. If you believe that as a parent, you have the ability to affect your child's entire life outcome merely by selecting the right moniker for that child, then that's what you're going to believe. And so I think, I mean, this goes back to your question about how much change have we been able to affect in the world? I think it's really hard. I think the best you can do is to work hard, be an honest broker, show your homework, and encourage people to think hard and think for themselves. But, you know, the whole notion that we can be puppet masters over other people, even over ourselves sometimes, is very, very hard. And so I think no matter what kind of work you're going to do, if it's going to be at all related to this, I think the single biggest thing you need is a very low threshold for disappointment. Because, you know, as much as I say the printed word has power and leverage, which I believe to to be true, institutions like governments and health care systems and education systems that have been doing the same thing for hundreds of years and that have many, many, many, many vested interests and trillions of dollars of payroll that nobody wants to go away, it's very hard to effect change within them, which makes me very sad on a daily basis. But I kind of understand it and accept it more on a macro. That said, I think as a species, we're doing okay. I think we've been gradually improving. We kill each other less than we used to. We have fewer wars than we used to. We live longer than we used to. We die of fewer stupid preventable diseases than we used to. We feed more people than we used to. I think we're actually slowly marching toward the right place, but it doesn't happen quickly. And I think we've played zero role in any of that.
- [54:44]
A
So there are, however, a small subset of people who are not doing okay, and they are bank robbers. And you have about 150 seconds.
- [54:57]
B
Okay, great.
- [54:58]
A
To tell us what you discovered about bank robbers, and hence the title of the book went to Robber Bank.
- [55:03]
B
It's a deal. So this post was inspired by a story I heard when I was in Iowa, which is right in the middle of the United States, about a woman who had embezzled from a bank for years and years and years. It was actually the bank was owned by her father and she stole about $2 million. This was in 1960, when $2 million was a lot of money. And the way she was caught finally was because she had a kind of breakdown. And the reason she had a breakdown was because she hadn't taken a vacation or a sick day in like 10 or 15 years. And it turns out that the way she stole the money was by embezzling it, keeping two sets of books. And the way that she kept the second set of books hidden was by never taking a vacation to allow anybody else to look at the books. So after she went to jail and came back, she started working for, for law enforcement and teaching them that one of the best things to look for in any organization, whether it's a bank or any kind of firm, is people who have unusual vacation patterns because there's a good chance that they may be doing something that they don't want discovered. So then we began to look at proper bank robbery data. Turns out that in the UK bank robberies go home with about three times as much money per robbery as the US which has to do, I think, more with available funds on site, maybe about $15,000 on average, maybe 12 versus about 4 or 5,000 in the US and that the average bank robber in the US and the UK gets caught after only three robberies. So your chance of getting caught is 1 in 3. So if the idea is when to rob a bank, the short answer is never. It's a terrible, terrible return on your investment. You know, if you're going to be a thief, embezzle, don't rob banks because. And then you go to jail. But if you really really, really, really, really. Still want to rob a bank, you ask? You know, the most common time of bank robbery is afternoon. And yet the data, if you can get them, which we looked at, are very clear. The more successful time to rob a bank easily is morning. So plainly the bank robbers are not looking up the bank robbery data or they wouldn't be working in the afternoon. Either that or they just can't wake up the at in the morning, period. If they could, they wouldn't have to be robbing banks for a living, presumably. So There you go. 90 seconds.
- [57:09]
A
90 seconds. And so that is when to rob a bank. Stephen will be signing copies of when to Rob a Bank in the atrium outside. I'm sure they will make excellent gifts. Christmas gifts, Mother's Day gifts, whatever, especially signed. Before you go out and snap up your copy and ask him to sign them, I would like you to join me in thanking the London School of Economics.
- [57:35]
B
Before you finish that, can I say one thing? I'd love it if you tweet something. If you're prone to tweet, even though Tim warned you not to tweet, you can tweet soon.
- [57:42]
A
Tweet now.
- [57:42]
B
Yeah, but feel free to tweet about Tim and me, Freakonomics, whatever. But we get tweeted about reliably. Duncow fc. Okay. Free Economics Radio, Duncow fc. Thank you.