Freakonomics

Freakonomics- Steven D. Levitt & Stephen J. Dubner

I first read Freakonomics when I was still in secondary school, and I think it may have been the catalyst of the revival of my interest in books. It challenges conventional wisdom and other assumptions we have about our world, in a fun, light-hearted and leisurely manner.

“I just don’t know very much about the field of economics. I’m not good at math, I don’t know a lot of econometrics, and I also don’t know how to do theory. If you ask me about whether the stock market’s going to go up or down, if you ask me whether the economy’s going to grow or shrink, if you ask me whether deflation’s good or bad, if you ask me about taxes- I mean, it would be total fakery if I said I knew anything about any of those things.”

Levitt is being humble and self-deprecating- but the truth is, nobody else really knows whether the stock market’s going to go up or down, or whether deflation’s good or bad. It’s far too complex for any individual to wrap his head around. He’s embodying a sorely lacking Socractic wisdom here- acknowledging his own limitations. Nassim Taleb would approve!

Economics is a science with excellent tools for gaining answers but a serious shortage of interesting questions.

The fundamental idea that seems to be expressed in Freakonomics is that incentives matter, that people respond to incentives, though almost always not in the way that we intend or expect them to.

Together, Levitt and Dubner describe how crime rose in the 90’s, attributed to the “superpredator” teenage criminal- and how everyone predicted that it was going to get a lot worse. Crime fell dramatically instead, and explanations attributed ranged from the economy, gun control laws and better policing. Levitt and Dubner argue that it was legalized abortion that did it- that the people most likely to have abortions were those most likely to otherwise raise children in an adverse environment- children who’re apparently more likely to become criminals. So criminals simply stopped being born.

Do real estate agents really want the best for you? Surgeons don’t operate on themselves, and we don’t have records of mechanics

Real estate agents will hold out for the best offer when selling their own homes, but will push you to accept the first decent offer that comes along- the additional money they get on commission from a better offer on your house isn’t enough incentive to get them to stick around longer- they prefer faster turnovers, selling more houses.

Is it money that wins votes, or is it a candidate’s appeal that wins both money and votes? There’s actually a way to test this out- by holding the candidates constant, and changing the spending. This actually happens all the time- candidate A runs against candidate B in consecutive elections. And it turns out that a winning candidate can cut his spending by half and lose only 1% of the vote.

Incentives are the cornerstone of modern life. Understanding them, or ferreting them out- is the key to solving just about any riddle, from violent crime to sports cheating to online dating.

Conventional wisdom is often wrong.

Dramatic effects often have distant, even subtle, causes. (This is interesting to explore in parallel with Malcolm Gladwell’s The Tipping Point or Seth Godin’s Unleashing The Ideavirus.)

“Experts”- from criminologists to real-estate agents- use their informationa advantage to serve their own agenda.

Knowing what to measure and how to measure it makes a complicated world much less so.

It is worth remembering that Adam Smith, the founder of classical economics, was first and foremost a philosopher. He strove to be a moralist, and in doing so, became an economist.

At a daycare center, some parents would be late in picking up their children at closing time. This was troublesome and wasteful for the teachers. A $3 fine per incident was added, to a monthly bill of about $380. The number of late pickups doubled- people used to try not to be late out of social obligation, but now that there was a financial cost to it, being late no longer made parents feel guilty. When a small financial stipend is given to blood donors, they tend to donate blood less- a noble act of charity becomes a painful way to earn a few dollars. What would happen if the late-coming fine were much higher, or if blood donors were paid a lot more? In the first case- latecoming would drop, but so would enrollment- you’d generate lots of ill-will. In the second- blood donations would skyrocket, but people would try to exploit it- perhaps stealing blood at knifepoint, use fake IDs to circumvent donation limits. Whatever the incentive, whatever the situation, dishonest people will try to gain an advantage by whatever means necessary.

White collar crime presents no obvious victim. Smaller communities have less crime than larger ones.

Why don’t we commit a lot more crime? Every one of us regularly passes up opportunities to maim, steal and defraud. Jail is a strong disincentive, of course (described here as economic penalties- losing your job, your home, your freedom). But when it comes to crime, people respond to moral and social incentives the most. The idea of being labelled as a criminal is worse than actually going to jail. If you could go to jail without anybody ever knowing, you’d probably be more likely to commit a crime.

My Mass Effect Experience

I want to talk about Mass Effect. I first started when I played Mass Effect 2 on my friend’s Playstation 2. As with Dragon Age, I wasn’t supposed to care. I wasn’t supposed to get emotionally invested. I never cared for Star Wars or Star Trek, so I figured maybe space and sci-fi wasn’t really my thing.

Oh boy, how wrong I was! My story began with a custom character in ME2- a male Shepard that I made to look like me. In the story I wrote in the DLC where you choose what happens in ME1- I saved the council, romanced Ashley and then sent her to die, killed the Rachni Queen, chose Wrex over whoever else. I think I was a Spacer War Hero (or perhaps sole survivor). I quickly and naturally fell into a predominantly Paragon path. I did everybody’s loyalty missions. I let Kasumi keep the box. I left Zaeed to die for being such an asshole. I didn’t allow Garrus or Mordin to kill their targets. I helped them find redemption instead. Destroyed the Collector Base. I was romancing Miranda all along. When I found Jack, though, I didn’t have enough Paragon meter to get them to seek compromise. I had to choose between one or the other. I chose Jack. I thought Miranda was being overbearing- as Commander, I expect my crew to look out for each other, or at least leave each other alone. I felt that Miranda was being the aggressor, which I felt was a direct assault on my principles. Siding with Miranda would be clear favouritism, too. I imagined that Miranda would understand where I was coming from.

Bollocks- I lost both her romance option and her loyalty! Women’s logic prevails. I was really upset about that, but I felt like it was the right thing to do, given the situation. (Given that I wasn’t man enough to get both of them to listen to me.) My favourite ME2 moments- drinking brandy with Dr Chakwas was one. Eavesdropping on the engineers. Getting closer to the crew- I liked how my Shepard and Jacob became bros later in the game. I enjoyed conversations with Thane and hearing Garrus’s funny sex stories. I was intrigued by Samara’s mysticism. I loved Kasumi’s depth and humour- I wish she was more than DLC. I found Tali to be kind of like a cute little sister type character. I enjoyed eventually helping to soften Jack.

Mass Effect 2 felt like a great buildup to Mass Effect 3. Unfortunately, I had lost my ME2 save- it was on a friend’s PS3, which subsequently got fried. So I ended up starting ME3 from scratch. (I decided to play FemShep instead, because she’s absolutely amazing.) It was a tad depressing, because I had watched many of the videos on Youtube about what happens when you DO carry your characters over- the romance options, the backstory. So I had to play those things in my head. I had to imagine Jack was around (my eventual, genuine romance option), when she wasn’t. It was painful to know that Thane was already dead, and it was kind of sad that I didn’t get to see Legion or Samara. The most painful thing for me was that I couldn’t save Tali. See, in ME2, I had the best possible outcomes for both Tali and Legion. In ME3, Tali is exiled by default. I made a silly mistake- I initiated the final Quarian mission without first rescuing the Admiral. This denied me the opportunity to broker peace, a ceasefire between the Quarians and Geth. I had to choose the Geth. The Geth had just recently attained self-awareness and self-actualization, and they had only acted in confusion and self-defence. The Quarians, in comparison, were insecure, needy and generally fucked up. Tali was their only saving grace. When forced to choose between the two, I had to pick the Geth. Tali- my old friend, who I had been through so much- committed suicide in horror.

I was shattered. I knew what the possible outcomes were in advance, but I wasn’t expecting to have cornered myself into a situation where I would have had to pick one or the other. It was like the Miranda/Jack situation again. I accepted this as a part of my story, my playthrough. I made a bad call- I should have gone for the Admiral. I’m not sure if that would have changed anything, if I would have been able to seek compromise, and brought Tali with me to the end. Some people online suggest that it’s impossible to get that best option without porting over an ME2 save. Oh well.

I remember being genuinely emotionally distraught after Tali’s death. I found myself thinking that I ought to stop playing the game altogether. How much loss should one have to sit through? I had already witnessed the deaths of countless people- Turians, Asari, Humans, Krogans- all of whom made the noblest of sacrifices just so that me and my crew would have the slightest glimmer of a chance, at hope.

They died so that we might TRY. But at that moment, I found myself thinking- how much more could I possibly take? It was Garrus who pulled me through. After Tali’s death (and knowing, especially, that Garrus and Tali would have had a romance if you romanced neither), I confided in him that I was losing faith, and losing hope. And he told me- “and this is when your best friend in the galaxy picks you up and tells you that you’re the most fantastic commander…”. It wrenched my heart, it really did.

We have to carry on for those who are still alive, who are still fighting. I have a lot more to say, but I’ll leave it at this for now.

What are your opinions on foreign talent in Singapore?

I got asked this question on EDMW“What are your opinions on foreign talent coming into SG? Do you think they are “stealing jobs from locals” like what majority of people are saying? (Basically your entire view on FT and what you think of the majorities view of the issue)”

That’s a really big question! To be honest, I haven’t completely made up my mind yet.

I think that foreigners coming to Singapore is normal and to be expected, and I am not against it in any way- but I also think that maybe we can oversee the process in a better and more equitable way. I think this is more than just the role of the government.

I think the government might have fucked up by allowing such a dramatic inflow of immigrants, and that maybe there would be less problems if it had been more slow-and-steady. Lots of people in government underestimated the social impact of such change. Or perhaps they were aware of it, but chose to go through with it anyway.

I think there’s a rejection of silent evidence here- by which I mean to say that perhaps in measuring all that we are to gain, we have overlooked what we have lost- because we can see the new successes, but we don’t notice when some of our most promising Singaporeans give up and migrate overseas. Just how many Singaporeans migrate every year? I think we need these statistics displayed prominently for all to see.

I don’t buy the “stealing jobs” argument. Jobs don’t belong to anybody. If we want to complain about others stealing our jobs, we have to acknowledge that we must have been stealing jobs from others for the past 30 years or so. And, taken a logical step further, the entire developed world is living the high life at the expense of the developing world- we have access to opportunities that kids in Africa just don’t.

Foreigners are willing to do the same jobs for less pay because they’ve spent their lives living with even less. I think we’re just lacking perspective, here. Maybe if we spent a year living in the hometowns of the PRCs and Pinoys we wouldn’t feel like they’re stealing our jobs. Maybe we’d wonder why there is such gross inequality in the world to begin with.

That said- I think the Singaporean response of unhappiness and frustration is completely justified. Nobody likes to have their way of living threatened and upset. It’s easy to say “change is the only constant”, “we must constantly upgrade ourselves”, etc- but the worst hit are always the oldest, weakest and poorest- who can’t do anything about it. I volunteer at Changi Prison on Saturdays and I meet good-hearted prisoners- older men who’ve been in there for years and are just eager to get their lives back on track. But how are they going to do it? Who’s going to hire a Singaporean ex-convinct over a cheaper foreigner? (Well, I would, but I’m not running a corporation.) Some people are going to go hungry. Is this the price of progress? It seems a little brutal. I’d like to imagine that civilized society can do better than that.

Perhaps “They’re stealing our jobs!” is too dramatic. Perhaps it might be more accurate to say, “They have a right to my job too, but if you let them in so fast, I can’t adapt, I can’t move on, and then you’re just swapping one person for another and there is no growth. His employment comes at my unemployment. Win-lose, rather than win-win.”

I have to concede that it does make sense from an “evolutionary standpoint”… but if we had that sort of cold-hearted reasoning, we’d also let our disabled and invalid die, and to be stricken by debilitating illness is a death sentence if you’re not financially secure. What kind of a society would we have, then, if people have to live in constant fear of the unknown? A little fear is good, it keeps you on your toes and gets you making pragmatic decisions- but paralyzing fear? Sometimes it feels like there’s two kinds of middle-class Singaporeans- the ignorant, and the terrified. Makes you wonder which is better.

I also think it’s bloody frustrating to have to go through all that is difficult about life- waking up, commuting, working, etc- while also having to deal with harsh and inconsiderate attitudes from others. Life is hard enough without assholes making it harder for everyone else.

I don’t want to single out any particular group of people, but my anecdotal experience has been occasionally frustrating. I notice Singaporeans are increasingly starting to stand on the left on escalators, and we’ve matured enough to avoid crowding in front of the train doors (it seems, lah) but some of the foreigners don’t seem to get it. I’m not saying all foreigners are fucked up- I have some great relationships with the PRC folk at the coffeeshop near my house, and I’ve seen some pretty cute instances of Singaporean/foreigner friendship- but there are always a few idiots who have to spoil it for everyone.

I don’t think the government can do much about this, I think this is a social problem that needs social solutions. I wonder how we can reach out to these folk. I’m thinking it begins with us reaching out to those who’re already kind of settled-in and “Singaporeanized”, and then we have to use these as proxies to reach out to the crazy ****ers.

TL;DR:

1: Foreigners are a fact of life, everywhere in the world. Inescapable. I’d try to adapt to it rather than reject it or be resentful about it.

2: The rate of inflow of foreigners might have been too high. Government may have ****ed up. We have to clean up the shit. It’s not fair, but it’s still our country. Vote better next time. 

3: If foreigners are stealing our jobs, we’ve also been stealing jobs for decades. Someone’s always getting screwed over. I think it’s good to keep that in mind, to give ourselves some perspective.

4: Even if it’s normal for jobs to go elsewhere, we could surely afford to make the process less harsh and painful, especially for the old, weak, ill, poor, uneducated, disabled. Change is disruptive, but we could be cushioning the blow better.

5: Some foreigners are really disgusting and inconsiderate in their behaviour, and I think this is a disproportionate source of frustration. I think Singaporeans would be a lot more tolerant of foreigners if they’d make more of an effort to be a part of our society. I think we should try to fix this by reaching out to them somehow.

6: I’ve noticed politicians asking Singaporeans to give more, to do more, to try and help the foreigners integrate. I agree with them, but I also think it’s messed up for someone earning so much more than me to tell me how I ought to be treating other people. I think that’s just a fundamental truth of behavioral psychology. If I were the PM, I’d give everyone a pay cut. “We need to pay for talent” is a bullshit argument that is being heavily undermined by modern psychology/sociology. Here’s a truth that’s even more tried-and-tested than “we need to pay for talent”- If you want to lead, lead by example.

Phew, that was really long. And as usual, my TL;DR also TL;DR.

Time to get back to studying.