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The Logic of Life: The Rational Economics of an Irrational World

The Logic of Life: The Rational Economics of an Irrational World

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Author: Tim Harford
Publisher: Random House
Customer Rating:   37 Reviews
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Editorial Reviews

Amazon.com Review
A Message to Amazon Readers from Author Tim Harford

Give yourself a pat on the back. You're not as stupid as everyone says you are, and now there's a book that proves it.

When I first conceived of The Logic of Life, my aim was to show that a world full of smart people--people like you, that is--doesn t necessarily look logical on the surface. We eat too much and worry about being fat; drink too much and cringe when we remember; spend too much at Christmas and worry about the bills in New Year. And that s just the small stuff: what about crime, racial segregation, divorce, big-money politics?

And yet underneath it all there is a hidden logic. It isn t always pretty, but it s there if you know how to see it. That is what The Logic of Life is all about.

But when I'd finished the first draft, my editor told me that he didn't think that people were as logical as I'd said. He wanted me to prove my point.

At first, I thought it was my editor thinks people are illogical because he works in the publishing business. Of course life looks illogical if you do that. (In fact, life looks crazy in most offices: see "Why Your Boss is Overpaid," chapter four.) But then I realised he was right. I'd left the most important step out.

So I went back and made sure that I laid out all the amazing evidence. I looked at single women hitting the dating scene in American cities; I looked at juvenile delinquents across the US; I looked at Mexican prostitutes; I looked at traders at a convention in Disney World; I looked at professional poker players in Las Vegas and professional soccer players in Europe. I looked at violent spouses, alcoholics, and school bullies.

In every case I discovered a story of hidden incentives and unexpected logic. And through the process of writing--and living--the book, I discovered that this crazy world of ours makes more sense than you might think.




Product Description
Life sometimes seems illogical. Individuals do strange things: take drugs, have unprotected sex, mug each other. Love seems irrational, and so does divorce. On a larger scale, life seems no fairer or easier to fathom: Why do some neighborhoods thrive and others become ghettos? Why is racism so persistent? Why is your idiot boss paid a fortune for sitting behind a mahogany altar? Thorny questions–and you might be surprised to hear the answers coming from an economist.

But Tim Harford, award-winning journalist and author of the bestseller The Undercover Economist, likes to spring surprises. In this deftly reasoned book, Harford argues that life is logical after all. Under the surface of everyday insanity, hidden incentives are at work, and Harford shows these incentives emerging in the most unlikely places.

Using tools ranging from animal experiments to supercomputer simulations, an ambitious new breed of economist is trying to unlock the secrets of society. The Logic of Life is the first book to map out the astonishing insights and frustrating blind spots of this new economics in a way that anyone can enjoy.

The Logic of Life presents an X-ray image of human life, stripping away the surface to show us a picture that is revealing, enthralling, and sometimes disturbing. The stories that emerge are not about data or equations but about people: the athlete who survived a shocking murder attempt, the computer geek who beat the hard-bitten poker pros, the economist who defied Henry Kissinger and faked an invasion of Berlin, the king who tried to buy off a revolution.
Once you’ve read this quotable and addictive book, life will never look the same again.



Customer Reviews    Read 32 more reviews...
  Insubstantial filler   January 2, 2009
Colin M. George (New York, NY)
I agree with everything Gertrude Whitman said, but I won't be able to say it as well as her. If you've read anything at all about behavioral economics before, there is nothing for you in this book. I bought it because it was on The Economist's list of best books and I often like their recommendations, but I was quite disappointed. Flipping through it, I found myself saying over and over "Heard that before ... read that on a blog months and months ago... Don't see why that's supposed to be illogical in the first place."

You read this book and you just cannot shake the impression that Mr. Harford's publisher really had to squeeze the 272 pages out of him. Its full of casual, page-consuming asides about where he's sitting when he's writing the book and how lucky we are to be reading it. It should have been published as an article in Wired or something, but even then it might not have enough original content.

It certainly has its merits. Its breezy and covers a variety of interesting topics, but this book would never have been published without the success of Freakonomics or Mr. Harford's first book. Three of the four economists quoted praising the book on the back cover are featured in chapters that describe their work in glowing terms. I don't mean to question their credibility, but its a little fishy that the publishers couldn't find anyone who didn't stand to gain from the book's success.

The paperback could make a pleasant, quick read, but do not buy the hardcover and do not expect anything truly novel.



  Engaging and thought-provoking   December 7, 2008
John S. Fry (Menlo Park, CA USA)
This book is Harford's second contribution to that lucrative contemporary genre of pop-economics inaugurated by Levitt and Dubner's megabestseller Freakonomics and by Harford's excellent debut, The Undercover Economist.

The goal of this book, like its predecessors, is to apply rational choice theory and evidence-based economic analysis to all kinds of conundrums and social forces that are familiar from everyday life. This time, the topics tackled include divorce, teenage sex, gambling, racism, and workplace politics. The point is that even seemingly irrational phenomena like racism, poverty, and exuberant executive "compensation" can be explained (though not justified, Harford emphasizes) in rational terms if we analyze them in the harsh light of economic incentives.

While I'm sympathetic to this view in general, I think that Harford, Levitt, et al. sometimes give short shrift to alternative hypotheses in their rush to explain everything in terms of the rationalizations of Homo economicus. For example, many "irrational" behaviors like drug abuse, teen suicide, antisemitism, and religious awakenings are cyclical in nature, like hemlines or musical fads. They spread like social viruses (memes). Cocaine was popular in the 1880s and the 1980s, but not in the 1950s. Understanding why requires understanding the workings of social networks and trends, not just plans and incentives.



  Welcome to The Service of the Free.   December 3, 2008
Jane Stevens
Swing from a branch on an irrational tree?
Yes, I think you might, but should you?
Ah, Now you see. You will and you will probably actually enjoy it. Truer words?

-Jane Stevens
Tao Cycle Therapy: Natural Happiness via Self Directed Cure for Chronic Anxiety & Depression



  Well written, but contentious   November 24, 2008
Bob Sanchez (Australia)
1 out of 1 found this review helpful

I enjoyed 'Freakanomics' & Harford's earlier book, 'The Undercover Economist'.

This was an enjoyable read with topics including poker tournaments, divorce, workplace politics, neighbourhood effects, racism, geographic agglomeration, voting and long-term economic growth.

I have some queries about the racism section though, and Harford's query "Why bother to get a degree or work experience if you are young, gifted, and black?". Bryan Caplan has looked at this and wrote:

"I tested these claims using one of the world's best labor data sets, the NLSY. The results directly contradict Tim's self-fulfilling prophesy story. Blacks actually get a substantially larger return to education than non-blacks! The same goes for experience, though the result is not statistically significant. The real lesson of the data is that if you are young, gifted, and black, you should get a ton of education, because it has an exceptionally large pay-off."

Also, I wonder if Harford considered Dr Satoshi Kanazawa's paper "The Myth of Racial Discrimination in Pay in the United States" (2005, Managerial and Decision Economics. 26: 285-294).

Overall, an interesting addition to the growing number of 'pop economics' books on the market, but not quite up to the predecessors.



  Logic and Rationality is Not Really What This book is About   October 26, 2008
Kaz Darzinskis (Downers Grove, IL)
The book is interesting and worthwhile to read, because it reveals studies and statistics (mostly by others) that illuminate why individuals and why society behave like they do. For example, it was surprising to learn how conclusive are the data supporting the idea that criminals actually are deterred by the severity of punishments specified by law. So we learn that criminals are more rational than many expert criminologists who argue for shorter jail sentences and condemn the irrationality of the death penalty.

The book does not prove that people are mostly rational or that people are not mostly rational, but simply that if one is clever or lucky about finding data, one can pinpoint a reason behind any observed behavior. For example, the evidence is convincing that black people in the USA have a disadvantage getting jobs measured against whites of similar qualifications. The author concludes it is rational for blacks to give up on education or, at least, devalue it and to adopt the social norm that getting an education is "acting white".

I disagree with how the author's uses the words, rational and logic. Just because there is a reason for a behavior does not mean the behavior is rational or logical. To take another example, short men and ugly men statistically have a great disadvantage gaining financial success. Men who are short or ugly men thus have a reason to abandon their personal efforts to compete with other mean, but it would not be rational or logical to do so.

That people have reasons for what they do is no great insight, so the author overreached when he selected the title of the book. But it was still interesting to read of some totally unexpected reasons the world is like it is.



Product Specifications


Media: Hardcover
Edition: 1
Pages: 272
Number Of Items: 1
Shipping Weight (lbs): 1.1
Dimensions (in): 9.4 x 6.4 x 1.2
ISBN: 1400066425
Dewey Decimal Number: 339
EAN: 9781400066421
Publication Date: January 15, 2008



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