Superfreakonomics_ global cooling, patri - Steven D. Levitt [7]
But humankind has a great capacity for finding technological solutions to seemingly intractable problems, and this will likely be the case for global warming. It isn’t that the problem isn’t potentially large. It’s just that human ingenuity—when given proper incentives—is bound to be larger. Even more encouraging, technological fixes are often far simpler, and therefore cheaper, than the doomsayers could have imagined. Indeed, in the final chapter of this book we’ll meet a band of renegade engineers who have developed not one but three global-warming fixes, any of which could be bought for less than the annual sales tally of all the Thoroughbred horses at Keeneland auction house in Kentucky.
The value of horse manure, incidentally, has rebounded, so much so that the owners of one Massachusetts farm recently called the police to stop a neighbor from hauling it away. The neighbor claimed there was a misunderstanding, that he’d been given permission by the farm’s previous owner. But the current owner wouldn’t back down, demanding $600 for the manure.
Who was this manure-loving neighbor? None other than Martin Weitzman, the economist with the grave global-warming prediction.
“Congratulations,” one colleague wrote to Weitzman when the story hit the papers. “Most economists I know are net exporters of horseshit. And you are, it seems, a net importer.”
The vanquishing of horse manure…the unintended consequences of cable TV…the perils of walking while drunk: what does any of this have to do with economics?
Instead of thinking of such stories as “economics,” it is better to see them as illustrating “the economic approach.” That’s a phrase made popular by Gary Becker, the longtime University of Chicago economist who was awarded a Nobel Prize in 1992. In his acceptance lecture, he explained that the economic approach “does not assume that individuals are motivated solely by selfishness or gain. It is a method of analysis, not an assumption about particular motivations…. Behavior is driven by a much richer set of values and preferences.”
Becker started his career studying topics that weren’t typically germane to economics: crime and punishment, drug addiction, the allocation of time, and the costs and benefits of marriage, child rearing, and divorce. Most of his colleagues wouldn’t go anywhere near such stuff. “For a long time,” he recalled, “my type of work was either ignored or strongly disliked by most of the leading economists. I was considered way out and perhaps not really an economist.”
Well, if what Gary Becker was doing was “not really economics,” then we want to do it too. Truth be told, what Becker was doing was actually freakonomics—marrying the economic approach to a rogue, freakish curiosity—but the word hadn’t yet been invented.
In his Nobel address, Becker suggested that the economic approach is not a subject matter, nor is it a mathematical means of explaining “the economy.” Rather, it is a decision to examine the world a bit differently. It is a systematic means of describing how people make decisions and how they change their minds; how they choose someone to love and marry, someone perhaps to hate and even kill; whether, coming upon a pile of money, they will steal from it, leave it alone, or even add to it; why they may fear one thing and yearn for something only slightly different; why they’ll punish one sort of behavior while rewarding a similar one.
How do economists describe such decisions? It usually begins by accumulating data, great gobs of it, which may have been generated on purpose or perhaps left behind by accident. A good set of data can go a long way toward describing human behavior as long as the proper questions are asked of it. Our job in this book is to come up with such questions. This will allow us to describe, for instance, how the typical oncologist or terrorist or college student behaves in a given situation, and why.
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