Freakonomics (Magnolia Pictures, PG-13)

If you can figure out the incentive structure—the real one, not the one that is supposed to be in operation—you can figure out where to look for people breaking the rules.

I’m not sure how economics went from being the dismal science to being the supercool science that explains everything, but one factor was the 2005 publication of Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. The somewhat unexpected best seller by University of Chicago economist Steven D. Levitt and journalist Stephen J. Dubner also met with critical acclaim, and it had sold over 4 million copies by 2009. Levitt and Dubner have since branched out to write a Freakonomics blog for the New York Times, and now there’s a Freakonomics movie as well.
I’m a huge fan of Freakonomics, the book, because it embodies a point I’m always trying to make to my students: statistics is not a just a set of mathematical equations intended to torture them; it’s also a way to explore the world and answer interesting questions. The film retains this same approach, revisiting some of Levitt and Dubner’s most interesting questions. For example, does good parenting (e.g., taking your kids to the museum) really matter? Does giving your child a “recognizably black” name like Shaniqua or Dewayne hamper his or her chances in life? Does paying students to raise their grades really work? And perhaps most controversially, did legalizing abortion lower the crime rate in the U.S.?
The experience of watching Freakonomics lies somewhere between attending an illustrated, freshman-level lecture by a superstar professor and watching a brainy but popular television anthology show. The real subject of the film is not economics per se but ways of thinking about important issues and testing different explanations of real-world phenomena.
Freakonomics has four main segments, each written and directed by different filmmakers, plus introductory and transitional segments that introduce related topics and often feature Levitt and Dubner discussing their ideas. Seth Gordon wrote and directed the introduction and transitional segments, which are the most information-packed and cleverly presented parts of the entire film.
I was less impressed with Peter Bull and Alex Gibney’s segment on cheating in Sumo wrestling. It’s a polished piece of filmmaking but repetitive and much too long. Their major point is that people respond to incentives (which is the major point of the entire film as well). It follows that if you can figure out the incentive structure—the real one, not the one that is supposed to be in operation—you can figure out where to look for people bending or breaking the rules.
For Sumo wrestlers, success depends largely on performance at a few tournaments in which winning 8 or more out of 15 matches raises your standing. So it would be logical to think that wrestlers who had won 7 matches going into their final match would have greater motivation to win that final match than wrestlers who had already won at least 8 matches. Sure enough, the historical record shows that those with more on the line actually do win their final match more often. Lest you think that this result was merely due to the 7-win wrestlers trying harder, those wrestlers were also far more likely to lose the next time they faced the same opponent, which clearly suggests match-fixing. Freakonomics ties in several other instances of cheating in response to an incentive. These include schoolteachers changing answers on their pupils’ tests and Japanese police departments keeping their rate of unsolved murders low by only declaring cases as murder if they are fairly sure they can be easily solved.
Jeremy Chilnick and Morgan Spurlock examine the popularity and implications of first names and their influence on a person’s success. It’s a clever segment, but it’s heavy on anecdotes and man-on-the-street interviews and light on hard information. Like Bull and Gibney’s segment, this one is also marred by statements of the obvious—among them that in the U.S. certain names “sound black” and others “sound white,” and that while a name may influence one’s destiny, it is not the whole story.
The most effective segment was written and directed by Eugene Jarecki, who cleverly incorporates the film It’s a Wonderful Life into an examination of Levitt’s research on the drop in U.S. crime rates in the 1990s. Many explanations were offered, including aggressive policing, lengthy prison sentences and the waning of the crack epidemic, but even taking those explanations and more into account left a good deal unexplained. The overlooked factor, according to Levitt’s analysis, is the legalization of abortion in 1973 (earlier in some states). This reduced the number of unwanted children—children who had an above-average probability to commit crimes as young adults. Levitt offers several convincing arguments: the crime rate dropped first in states that were early legalizers of abortion, and the drop was only seen in the under-25 age group (which would have been affected by changes in the abortion law). He also points out that moral beliefs about abortion have nothing to do with a statistical relationship seen in the data.
Finally, Rachel Grady and Heidi Ewing take a look at the effectiveness of financial incentives to improve student performance at a high school in Chicago Heights where ninth-graders are given $50 a month if all their grades are Cs or better. The filmmakers wisely focus on two students, giving this segment a Hoop Dreams quality, and show a real knack for capturing the reality of teenage life among the underachievers. Case in point: a hilarious segment where one boy insists he read To Kill a Mockingbird, when it turns out he only skimmed it to find the answers to his homework questions—and that he really doesn’t understand the distinction. This segment comes to the conclusion that financial incentives can have some effect (the school average does increase) but that the gains are limited and should perhaps be tried in the earlier grades before so many bad habits have taken root.
If you’ve already read Freakonomics, you’ll probably want to see this film even if, like me, you’ll find it more a pleasant diversion than an eye-opener. If you haven’t read the book and have any interest in how people behave, you should definitely see it; the probability is high that it will introduce you to a whole new way of thinking about the world. | Sarah Boslaugh

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