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Freakonomics (2010)
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So I wanna sell my home and I put on the market for 300,000 dollars It's a lovely home you have I'm the agent Alright so let me start over, that was my ... i'm sorry Alright I wanna sell my home I put on the market for 300,000 dollars I get an offer today for $290k The question is if I wait a week and get the offer for the full $300k Would I rather wait that week and get the full price? Or take the offer today for $290k Ah you want to take it now I'll be the real estate agent I'm telling you want to take it right now because because a bird in the hand is worth two in the bush... The market is starting to really soften up with these things you just can never tell If you get a good offer, I really think it's the right thing to take it And I'm not speaking out of self-interest cuz I'm the real estate agent and our interests are aligned cuz I'm getting a commission out of your sales I want you to get as much as you can for this house I really do When you think about the incentives that the current contract set up between the home seller and the agent representing them, they are not well alligned But can you ever prove that? Interestingly, if you look at the sales data on real estate agent own homes It's not their client's home when they sell their own homes They get more money than they sell the same home for their client Now why would that be? What we find in the data is that agent hold out for better price and leave their own homes on the market for longer an average for 10 days longer But when it comes to your house The agent has the incentive to sell right away Why? Cuz sometimes that $10k into his or her pocket -Only $150 -I only get $150 Because if you take that $10k that goes to him Half goes to the buyer's real estate agent So I get half of that six percent But then I have to kick back half of that to my agency So I only get one and a half percents So really, in order for me to help him gets the extra $10k I personally only gets $150 But I have to work for an extra week I have to buy all the marketing I could be off to another client trying to get another whole commission on another house So I have a strong incentive to say to him this is a great offer It's the best offer you can get I really think you should take it So no matter what the real estate agency says I would rather wait a week and pick up the extra $10k The agent wouldn't It's not that real estate agents are bad It's just that they're human beings and human beings repsond to incentives If there's only one element that I say is that almost everything we do is the idea that incentives matter and if you can figure out what people's incentives are you have a good chance to guessing how they're gonna pay it New prents look at successful families and successful parents and they just want to copy them and so they try to do the things they think that they did to get their families so smart and good and whatever which is really just a ... can be a bad mistake of correlation cuase isolagi You're gonna take your kid to ... you know ... every mommy and me music class and you gonna take him to the museum and start looking at all the dreaken roman sculptures you probably already playing mozart in the worm to get the brain really stimulated and it turns out; that the best that we can tell from looking at data of actual parents and children along these dimensions that that stuffs don't really matters that it just dones't make your child...better so it might make you happier, might even make 'em happier, might also make 'em miserable but it turns out that those are not causo-elements I always said you can teach a kid just as much as in a grocery store you can as in a museum, maybe more My entire academic life has been devoted to figuring out tricky ways to get a cause-eality because the world just doesn't offer you a cause-eality okay, what you see in the world is correlation So what the world gives you is - things are moving together or they aren't But to be useful, you need to dive down be able to strip away what's causing what, what's not causing what The data we looked at suggests that, by the time you actually have a kid most of the choices that you make will make you a good parent you've already made them. So if you go to the bookstore and buy 10 parenting books, It's probably not really gonna help the kid that much But the fact is that you are the kind of person who as a parent cares enough to buy 10 parenting books even if you dont' read 'em. That probably means you are a pretty good parent Just don't think the books are gonna have a magic effect Ah parents, we wanna believe so much that everything we do is going to make a difference in our children's lives. What they eat, where they go to school, who they hang out with But before any of that takes place, parents are confronted wth the one single ominous decision that could shape the entirety of their children's future what is going to be their name?! These days, there's an entire industry devoted to naming your baby. And business is booming There's magazines, books, websites There's even high profile baby naming experts. I'm a baby name expert I study names, I ask the parents how they choose names for their children and I look at how names are changing, because baby names are changing today faster than ever before. Names are important, because they have a lot to do with your family, your heritage. Names represent huge, you know what I mean, street creditbility all of that. Names are definitely a big part of meeting someone A name can make you popular, and a legend. Without a name, u're nobody you've got to have a name. It tells your whole identity. But just how important can name really be? I mean, unless you're Rockefella or Gates Can your name have some sort of magical power over your entire destiny? Not convinced? What about the following stories? Once upon a time, there was a young mother who thought she was naming her daughter after her favorite actress on the Cosby show The smart and firery Tempestt Bledsoe This is the most humiliating moment of my entire life and there had been many But having never seen the way it was spelled The young mother mistakenly named her new born daughter Temptress Well, little Ms. Temptress didn't have an easy life growing up -I don't even know -What do you mean? As a teenager, she became sexually promiscuous Got into a whole bunch of trouble Back here you little shit That's right. I better not let me catch you And ended up in court All Rise! Leaving the judge to ask her mother Is young temptress just living up to the expectation of her name? Was that just one little misplaced 'T' and 'R' all that stood the life of ease and huxtable success, verses those long hard days in court ... and 'juvie' Harvard professor Dr. Roland Fryer was determined to find out just that What happened to Temptress has NOTHING to do with her name, has everything to do with where she grew up It turns out, Temptress grew up in a poor black neighborhood The kind of neighborhood Dr. Fryer has been studying for years As a world leading renowned economist and an leading expert on race in America Fryer has been long been interested in what he calls Cultural Segregation The gap between White Culture and Black Culture One embodiment of that culture is what you name your kid is probably one of the few cultural items that we can really measure precisely What we did was we looked at the effects of your kid's first name on their life outcomes Dr. Fryer analyzed the naming records of every baby born in the states of California over the last forty years and those names tell an unmistakable story African American parents are more likely than any other ethnic group to give their children unique names There is definitely a distinction between names ... ... for white people and names for black people Black names will be Molique, JAQuan, NayShan, Naheem -TaSha and Shamika -Shaniqua and NaShan and KayShan I know this girl, her name is "treasure", TREZURE struck me as typically that's more like an african american name I like the names that begin with SHA, like Shaheem, Shahee, Shamur Shakeem, ShaKoor You know - Oprah. It's popular It was actually in the fifties and the early sisties that we saw huge overlaps in the naming patterns of blacks and whites So people name their kids John and Michael and names like that And what you saw was around 19 ... in the 1968 or so kind of the black power movement actually you saw distinct biofabrication with black names getting more disctinctively black and a lot of them are islamic names Because the black power movement is about identity - who are we? Who are you? Are you part of us? It wasn't until the late 80s and 90s that we started to get you know, kind of the ... made up, concatenated names that you see now This is generation today, they saw the change the whole name change concept they have names that are 30 letters long you know Everybody try to do something, um ... how do you say, unique they try to name their kids over something different you know We had 228 unique versions of the name "Unique" Again, my favorite was ... UNEQQEE another one of my favorite was UNEEK ah ... so there are a lot of people trying to be unique So what happened to all these uniquely named kids? Kids like poor little temptress I think it's not the name that's doing the damage to temptress It's that they grow up in the type of situation where someone would name their kids Temptress The person would actually names their kids that probably has a host of other issues that are influcing their kids' lifetime outcomes Not just the name itself What kinds of issues? Let's look at a boy with the most studied white name and a boy with the most studied african american name The person who gives their kid a distinctively biased name on average is more likely to live in poverty and to be kind of on the lower wrongs of the socio-economic ladder You see, this is where Jake lives and this is where Deshawn lives The schools are not functiong - the teachers in those shcools aren't the same quality as would be in Jake's neighborhood In those neighborhoods, 80% of the households are female headed only and what we found is that, names don't matter so much they type of mother you have, the type of family you have the type of community you grow up in those things matter a lot but what they name you, just doesn't matter So name doesn't define your destiny? Maybe if you name someone destiny, I don't know But ... No. I mean your name doesn't define your desinty A name may not define your destiny But it can dictate the ways other people perceive you Meet Harvard professor Dr. Sendhil Mullainathan I'm very familiar with Roland Fryer's work We both worked on the impact of names I think Roland has emphasized that people who choose names that are very black are different from other people that choose names that are not very black whereas, we emphasize that holding everything else cosntant that people who end up with very black names are treated very differently We know that in the data African Americans earn a lot less We are interested in how much of that earning less is simply they find it harder to get a job are all African Americans treated very differently in the labor market than whites Dr. Mullaninathan conducted his own study This time in Boston and Chicago What we did is we made up 5,000 resumes Half of them we put an African American name, half of them we put a White name Otherwise, the resumes were the same. And we send them out And we said, which gets callback more? What we found was that the same resume when it had an African American name was about 33% less likely to get an interview than it had a white name It means that, if a White person searching for jobs for 10 weeks an equivalent skilled African American will search for 15 weeks and those are 5 long weeks if you were unemployed You can judge somebody by their names It's not right, but people do it They assume that, just because your name is Monique or your name is LaVongue,or Shenanig, or that that you're African American and you are not qualified because your name has an ethnicity to it. One time, there was a girl name LaKeisha talked on the phone and I thought she was black but when I met her I was totally shocked that she was a white southern girl When I picture LaShandra, yea she's black The names we used in our studies were names like Lakisha, Jamal, Tyrone Based on the results, it raises a question I'm an African American parent, I'm thinking naming my child Tyrone sounds like a very good name, I might have a grand father named Tyrone Should I name my child Tyrone? Yes, name your kid Tyrone, you've made it harder for him in the labor market On the other hand, should you give in to that? Should I give in to the prevailing norm, or should I express my individuality? as I want It's a bit of an ethical quandary My friend got a drug dealer named Tyrone and I assume it's a black guy Todd is a white name, Tyrone is a black name I mean that's sort of how it goes, right? You might choose a distinctively black name as a way to signal something about yourself and about your commitment to the black community and that's the way to show other African Americans look I am really black and I think there're distinctively black names already tell you that there's a cultrual divide at some core, visible, noticeable level and we see it sometimes in clothings, we see it in names and in fact that's true, there're quite a few distinctively white names names like Emily, Brandon, ... ah ... ... forgetting what those ... if you give me a minute I can count the others White names are like Sarah, Megan Mariah, Mary Billy Beckys, Johns Tadd Joe, Mike Ryan, Sam Chester My brother and I were talking about how we have white sounding names He's Abner, I'm Harper Stone, Stone Phillips, that's like perfectly sutited for a white guy that's the best white guy name you can have. We live in different cultures and your name is largely determined by your culture and the difference in the incident of LaKeysha among African Americans vs. white might be a good way to understand how truely there are different culutures African American inhabit and white inhabit Today, there is more evidence than ever that the cultures we come from influence the names we choose Just ask the baby naming expert More and more today, you see parents choosing a namealmost as if launching a product that you're tryint to position a child for the best chance of success in the global market place So in an oversaturated market place which names garner the most attention? Are some names destined for the top self, while the others are headed for the bargain basement? Let's take a look at the two product lines Turns out, there is a such a thing as a knock off name The top 5 middle class white girls names from Fryer's studies are: (in order of popularity) Ashley, Lauren, Jessica, Emily and Sarah While the top 5 lower income white girls names are: Brittney, Samantha, Amanda, Jessica and Ashley So what happens to Ashleys?! She's fast loosing popularity in the middle class list But she's no.1 in the WalMart crowd As those wealthier folks see their names popping up everywhere they quickly discard them in favor of less merchandise And just like that, Today's high end Ashley, becomes tomorrow's low rent Trashley On the lower strung of the ladder, are the names that most signify lower class parents. Like Misty, Destiny, Bobbi, Brandy or Cyndi Now if you are over 40 and actually remember a time these names did't belong up here on stage You're right! Years ago, these names wouldn't be caught dead in a place like this But the years have not been kind to a name like Bobbi And even though she once was at the top of the social-economic ladder Today, she's just clinging to her former glory Please don't name your kid Barbie or Bambi or anything like that, they might end up being a dancer one day because of it And if you do end up with a name that's bound for stripperdom at least you can change it I mean, hey, it works in Hollywood Think about it, would John Wayne has been as tough if his name is Marion Morrison? Would we think Marilyn Monroe as beautiful if her name was still Norma Jean? And would we think as Ice Cube rocking the crowd if his name is still O'Shea Jackson Actually, I always wanted to change my names to Max Powers cuz it seems like a name that everybody like once they hear that they're like this guy must be really cool I want to change my name when I was younger, I never liked it If my name was, um, Henry O'Barma You know what I mean? I think that would mean something to people and I would have more doors opened for me I did want to change it but now I'm sort of cool with it You just sort of like jumps on your back and rides along with you through life you know As much as you may hate your name, at least your dad isn't this guy Meet Robert Lane He has two sons. He named his first son Winner. So Winner and Loser Lane set off in the world to claim their destinies And what happened? Well, Loser went to prep school on a scholarship Graduated from college, joined the NYPD and eventually became a detective. And then, a sergeant He goes by Lou now And his brother? Well, the most note worthy achievement of Winner Lane is the sheer length of his criminal record Nearly 3 dozen arrests for burglary, domestic violence, trespassing and other mayhem Is there one name that you can give a kid that guaranteer that won't become screwed up? No Sorry, there's not one name that you can give a kid that guaranteer they won't become a screw up And there's not one name that you can give a kid that guaranteer they will become a success You know, it is a crab-shoot when it comes to names I don't think there's any name that can guaranteer success, at least none that we found The world is full of ... ... excellent people and terrible people with all sorts of names The vast majority of the reason people choose is left unexplained It's like, why did you choose your child's name? Sounded nice Who really knows what parents are thinking when they choose a name Maybe your parents went with something traditional Or something bohemian Something unique Or something perfectly trendy And maybe your parents didn't have the best taste and you can't stand your names Or maybe, they got it just right Actually, my name means intelligent hero So, that describes me to the fullest I was actually named after a horse . My dad is a horse trainer. My middle name is comfort, because an angel came down to comfort my mother and told her she's gonna have a daughter with dark hair and blue eyes who would be a great comfort to her The prophet Mohammed My name says that I'm named after my grand father who was named after his great grandfather that was it says In the end, most parents just want the best for their children and if they believe a particular name they give can give their kid the extra edge Then why not?! I mean who konws? It just might work CHEATING As W.C. Fields once said, "A thing worth having, is worth cheating for." Or as Mark Grace of the Chicago Cubs once said "If you ain't cheating, you aint trying." Everybody understands why a kid would want to cheat on SATs right? They have huge gains of ... get into Harvard and have a good life as a result of cheating on a test What's hard to think is why would a teacher cheat? for a kid on a test And, when you go to Chicago and goes back a few years ago We find that lots and lots of teachers were cheating Why would they cheat? Well, because there was tremendous pressures on the teachers to produce high test scores so their schools wouldn't get into troubles First of all, to a very expedient ... to go to the end of the test Cuz at the end of the test, a lot of the kids've left them blank So instead of having to erase something and fill it back in, you can just fill in the answers It might look kind offunny cuz how often would kids take a test and they answered the first 20 questions, leave 17 questions blank, and then fill in the last 8 questions maybe be even a little funnier when they fill out the last 8 questions and they all all the questions right and those happens to be the hardest quesitons on the exam THE EVIDENCE When I got the data from this guy from public school I mean we are talking about millions and millions of answers thousands of kids, over years and years and I looked at the data, I couldn't see anything. How can you see anything?! If you can think like a teacher who cheats, and look again at the sea of data These patterns come to light Patterns, which are suttle. Burried under mounts and mounts of data When looked at through the varied length, suddenly It just as clear as day. And when you know what to look for You can't help but say it has to be cheating What he's really good at, is pretend he's a cheater a criminal, a thief, a cheat, all these things because cuz really he's not far from it; I mean if you really think about what an economist is the line between an economist and criminal is terribly thin -And what about journalists? -Um, no line Because he can put himself in the shoes of someone who would behave criminally or who's a cheater then you can back up the process and reverse engineer it And that's what you have to do. Because unless you are in the room with cheaters, it's really hard to catch them It's not that some people cheat at every second or some people never cheat We all cheat sometimes and others Everyone got their own moral encompass to determine what they'll do and what they won't do Economic tries to be a pure science in an impure world Economists imagine men and women are rational actors In a market place that hides nothing from buyers and sellers But what happens to market when people cheat? and I was in Washington DC I remember just seeing a little blur in the Washington Post that said there have been allegations of cheatings in Sumo Wrestling My view has always been, if some insiders come forward and say there's cheating, probably there's something to it If you had said, where is a sport where you would not find cheating I'd have said Sumo Wrestling, one's that got 2,000 years of history it's all about purification, ritual and honor It's located in a culture, which on all of the rankings of corruption across the country is really really low The ancient sport of Sumo Wrestling, is the essence of pure competition Two naked men, fighting in a sandpit Under the watchful eyes of a referee, dressed as a Shinto priest Shinto, means ways of the Gods A religion that celebrates the purity and harmony of men and nature In Sumo, you do your ceremonial stuff One is the clapping of the hands as to awake the Gods Two is when we show our hands and flip our hands over and stuff to show that we have no conceal weapons You come here and you want to fight fair with your bare hands and to tell the Gods you're coming in with a fresh and clean might and heart vessel. The stomping of the feet in the Shinto religion is to stomp out evil spirits and throwing of the salt is purify I think purity is a good mask, for corruption, perhaps most so it discourages inquiry. It's true that Sumo might seem to be immune from corruption because of its purity, history, and so on On the other hands, the stakes are high When stakes are high, and when there's an incentive to cheat A small percentage of people always will Just as in medieval Japan The wrestlers, known as Rikshi or strong man spent years in apprenticeship Living together around the clock and training in stables or Biar Subject to strict moral and physical displine If you're a Sumo Wrestler in the top ranks Your life is very very good and you can live like a king Once you fall belows those ranks or never attained those ranks, your life is not very good at all So, it's a very steep pyramid, at the top life is great, and there's lots of people down below life is not so great But there are so many of them, because they're all aspired to get to the top obviously It's a battle 24/7, being a Sumo Wrestler It's not just two big fat guy trying to ... ... to kill each other but it's a lot of work to be big and at the same time active you have to wrestle with injuries they throw you in a jungle and see how you can come out alive The objective of the game is to push your opponent outside of the ring or pushing him into the ring But how can you tell if a Sumo Wrestler is cheating? Is it a slip on purpose? Is the fall rigged? It's hard to tell unless you look at patterns over time People who are actively corrupted always try to cover their trails So corruption, by its nature is hard to identify, hard to prove Murders are really great, cuz almost always when someone is murdered, there's always a corsp You might say "How would you know someone's cheating?" and the answer is - look in the data I don't have to ever seen a sumo match I can look into data, I can look at it And I can tell you, with almost complete certainty, that there's rampage cheating going In professional Sumo touraments, the wrestler fights one bout per day for 15 days If you win 8 out of the 15 matches, you can move up in rank - half a slot The difference of half a rank can be maybe 5,000 dollars in paychecque a month The respects you get in the Sumo Association So when you talk about stuff like that, that 8 win is real critical A Rikshi entering a tourament final 15 match with a 7 and 7 record, has far more to gain from a victory than an opponent, say 8 and 6 has to loose If a wrestler has 8 wins under his belts, he's guaranteed to advance Even if he looses that last match So he could afford to take a fall In Japan, there's a term for match rigging - YAOCHO Many suspected that Sumo matches might be rigged But it's nearly impossible to prove, unless you look closely at the numbers When 1 of them needs the eigth win and the other doesn't The one who needs it wins 75% at a time Rather than 50% a time That's a huge deviation I (8-6 wrestler) let you (7-7 wrestler) let you win this deciding match cuz you my friend gonna fall down the pyramid if you don't In return, the next time those 2 guys meet Lo and Behold, the 8-6 wrestler almost always wins those matches "Honne" is Real Truth and "Tatemae" will be the surface of things, the faced They are unusually important in Japanese culture That's why the Japanese have given them names But being human, living in any society, I think we can all understand the concepts themselves That Tatemae's going to be a great spectacle of honest competition but in the surface of creating that pleasing faced the actual players are engaging in a form of corruption To have the "Honne" exposed produces discomfort When you think of the financial scandals That have racked America recently A lot of people who were supposedly to be not just incredibly wise but incredibly honest, has been exposed as neither Those of us who have looked looked to the self-interest of lending institutions to protect shareholder's equity, myself especially, are in the state of shocked disbelief. That produces a kind of dissolution, in any society that formerly looked to those people or those institutions ... ... are somehow representatives of what's best in our society Sumo would be an example of that in Japan While I would not put the Bernie Madoff pre-arrest reputation, I wouldn't necessarily call that one of purity The way we would talk about Sumo Wrestling, or the way we might talk about the Catholic Cleregy The S.C.C. had an image of this guy - that was almost sacred saint in that he's running the exchange, he'd been a market maker. His reputation was so large that it discourages them from coming in with a bias toward corruption, and instead, they brought a bias against it. Mr. Madoff, what do you have to say for yourelf? What do you have to say to the public, your investors? The realm of high finance and the world of sumo both demonstrate the illusion of purity cannot only hide corruption, it can help to make it possible. In Sumo, when whistle blower step forward to expose corruption they were not treated kindly. In 1996, two summo vetrans, including a recently retired stable master, collaborated in a tell-all expos that was serialized in the Shukan Post The Sumo Association dismissed the allegation as lies, told by a revengeful stable master seeking to cash in on publicity. To defend their claims, the whistle blowers decided to hold a press conference. But two weeks before the press conference, both men died. In the same hospital, on the same day From the same ... myterious respitory illness. Yet no one questioned the way they died, there were no autopsies The police did not investigate the sudden and simultaneous deaths. "It's a very good hospital", a police spokesman told reporters. So, there were no grounds for suspecison. Concerns about the sport resurfaced when another mysterious death haunted Sumo This time it was a young "Rikichi" in training named Takashi Saito Whose corpse showed visible signs of assault and multilation. Hiromasa Saikawa took note of the death of the young wrestler Sakawa is one of the nation's most vocal critics of how murders are investigated in Japan. He quit his post on the Tokyo Police Force When the gap between the "Honne" (the hidden truth) and the "Tatemae" (the facet propriety) had grown too wide The job of any police force is to help keep crime at low enough levels so that society can properly function. The "Tatemae" of the police force is to be seen doing that If the police can tell society, we solved 96% of crimes, they have certainly fulfilled their "Tatemae" function. In comforting society, making society feel safe. But to achieve that level of "Tatemae" The police might select only cases for investigation that they think they have an extremely high chance of solving Despite clear evidence of brutality, the police declared that the young man died of natural causes. And the stable master quickly asked for the young boy's body, so it can be creamated. But the angry father of the young man insisted autopsy, which revealed that he has been burned with cigarettes; and beaten to death with beer bottles and baseball bats. The young boy has died at the hands of fellow wrestlers who're ordered by the stable master to punished the boy for trying to run away from the world of Sumo Sumo counter-criticism with lawsuit against Takeda and his magazine Juries ruled against Takeda in cases where he accused individuals of match rigging But Sumo had no defence against the revelation of violence. To defend its reputation, the Sumo Association shores up its image By building on notions of purity from Shinto that are essential to be what it means to be Japanese Publicly, it insists that Yaocho is a myth. I hope ... there was none of that going on in the bottom ranks. But where I was ... No. A retired Rikshi who wrote to Komosubi - the 4th highest ranked in Sumo. Keisuke Itai came forward, and publicly admitted to fixing many matches. And named names of others, who did the same. In Japanese media, there's a certain form of self-censorship giving interviews in japanese, the media will not quote me if I use the word "Daraku" which is corruption in japanese and they'll change it instead to something like "Konran" - confusion. We certainly have the very same thing in America today. The New York Times, for example, will not use the word TORTURE to describe anything that's been carried out by Americans ... ... operating in our prison system and the war on terror. However, if it's the Chinese who've done these things to an American airman, the NY Times has no compunctions about calling those things TORTURE The only way to combat corruption, to Steven Levitt, is to change rules to undo corruption incentives Unleash more investigative reporters and develop strong protections for whistle blowers. But that's easier said than done when cultural slogans in American and Japan that we are honest, straight-forward and fundamentally good. Those who expose corruption are challenging the very nature of who we imagine we're supposed to be The irony of our Sumo Wrestling was when it became public, the Sumo Wrestlers stopped cheating. and they're not for good, they actually stopped cheating for a year or two and once people stopped thinking about it, they went back to it. but that I think is the answer how you stopped cheating. Louis Brandeis said that sunlight was the best disinfantant. What keeps us from seeing corruptions are our illusions that our economy is a rational system. A free market, opened to all The fact is that rigging markets and matches is good business If the rigging is hidden from all but a few In Shinto, the mirror is an important symbol reflecting a sense of who we are In that mirror, the bad heart is a hidden heart The pure heart is the one that hides nothing Looking at the numbers and accept what they tell us is a way of wiping dust away from the mirror Hi there boys and girls this is Captain Kangaroo Say, I like you to meet a friend of mine say, you know it's a lot and lot of fun to have a pet that you can run, jump and play with, isn't it? But did you know there're kids that cannot run, jump and play? It's all because a thing called Polio When I think of bad historical assumptions about correlations and causeality, I think of Polio 100 years ago. When it was this horrible mystery that claiming a lot of lives And it was really scary cuz it mostly struck children. And there was a strong line of resarch that suggested ice-cream cause polio, that ice-cream consumption cause Polio. Here comes Mr. Softy, the soft ice-cream man. The reason that correlation was thought to be causal was that Polio spiked in the summer time For reasons, that weren't really understood, but it did. And ice-cream sales spiked in the summer time. So, these researchers're seeing that whenever a lot of ice-cream are being sold, and consumed, there was a lot more Polio. And that was literally the beginning of ice-cream prosecution to try to stomp out Polio. And it sounds rediculous, but you see it all the time now - people try to fight against or build up something that they're sure that's connected to something else, but turns out it just isn't. We have a crime problem that is not out of control -all over the country -I am pro-choice extremists bombed more than 30 clinics across the country People like you allows baby ... When I started studying crimes in the early 1990s, it was rough at its peak the highest it's ever been in the history of United States and all the experts expect it to go higher and higher The warnings are everywhere. But then, to everyone's surprise, something happened. I don't know, I guess you're right Supposed it'd be better off never been born at all. -What did you say? -I said, "I wish I have never been born." Homocide rate went up in half of the nation's cities (Christmas, 1989) 373 homocides last year up 65.7% over 1987 Murder is a national problem - up an average 11% across the country. In Bucharest tonight, the post communist leader Nicolae Ceauseascu and his wife, had been executed. Pictures of the former communist dictator lying in state -excuted by the firing squad -Crime and violence are now ... the top concerns of many Americans. You've been given a great gift George. A chance to see what the world would be like without you. As the 1980s drew to a close, law enforcement experts predicted that the crime rate that has been preceeding decades would continue to rise. Would be the decade of the mega criminal There was only one problem ... it didn't happen. Across America, the crime rate is down. The FBI has some good news about crime, it's down. It's clear the numbers are dropping, what's not clear is why. What's behind this dramatic change? Primarily it's the Police, the police strategies. We've incarcerated our criminals and thus taken out the population. With those people, who did the crimes. Experts and officials lined up to offer explanations for the drop in crime Community police officers, better prevention Their explanation included more innovative policing, harsher criminal sentences, changes in the crack market, increase gun control, a strong economy, more police on the streets But economist Steven Levitt examined these explanations. Evaluated the most popular ones. When you looked at the data carefully, it's just not clear that they really have the impact people suspected. By ananlyzing the reasons most often cited by those in the press, Levitt was able to separate the more likely factors from the less likely ones The crime drop explanation most often cited was that innovative policing strategies had been introduced to some cities. NY City, for example, implementeded sweeping law enforcement changes from Police Chief Willam Bratton's ComStat System to Mayor Rudolph Giuliani's crack down on small street crime The reductions in crime that has been taken place in NY City are pretty close to miraculous NY City, had among the biggest declines in crime of any city in the country. So, there's an enormous amount of fan fair ... ... given to the strategies of Guliani and Bratton. But crime felt everywhere, it's hard to find any city in United States where crime didn't plunge. And also, crime was down 20-30% before Gulian ever took office. So, a number of things make me suspecious that it was really the Placing Strategies. The second reason most cited for the crime drop, was an increase in reliance on prisons. We've locked up a million more americans since the 1990s There are now 2 millions americans in prison, and that's got to reduce crime. Levitt recognizes that in prison more people will ... in short term, bring crime rate down. By my estimate, about 30% of the decline in crime can be attributed to the fact that we got very tough on crime in terms of locking up criminals. This is crack cocaine The 3rd explanation for the crime drop, most often cited in the press, were changes in the crack market. Now experets say, crack cocaine may finally be on the decline. The peak of the crack epidemics came in at the late 80s and the early 90s At that time, an enormous amount of the homocide in particular can be attributed to the crack. But for various reasons the amount of violence that has been associated with the crack trade really faded. That's not the move no more So that can explain 15% of the decline in crime. Other possible reasons for the crime drop examined by Levitt include: tougher gun laws. the 1990s economic boom and an increase in police nation wide. So Levitt did not entirely discount these He sees these only account for a small fraction of the overall crime drop There are millions factors that drive crime, but how do you determine the particular competition? Overall, what Levitt found from all these reasons was taken together, they only explain half of 1990s crime drop. The other half remained a mystery. So what happened? Well, let's remind to what many Americans may have seen as irrelevant incident in a far away place. When Romanian dictator Nicolae Ceausescu was executed by his own people on Christmas Day 1989, it marked the end of the brutal totalitarian rein that has lasted 24 years. In his earliest days, Ceausescu's Romania faces struggling economy and he sought to vastly increase the workforce. To achieve this, Ceausescu outlawed abortion in 1966. Agents known as the Montrose Police rounded up women to give pregnancy tests and attacks the infertiles. Across Romania, women were forced to have children and they could no longer choose whether it was right to do so. Romania's birthrate doubled. But more and more births across the country were, not surprisingly unwanted. And result in trouble up bringing. Of the infants forcibly born in the first year, more disenroll school, suffered more job performance, and with thus more likely to become criminals, than those born of the previous year. Even controlling for the aids, income, health and education of the mother But what do winds in Romania a long time ago, have to do with crimes in US in 1990s? According to Steven Levitt ... a lot. You've been given a great gift George, a chance to see what the world would be like without you. What I believe to be true and the evidence supports it, is a hypothesis which many people find jarring and disturbing. But nonetheless, I think it's probably right. Good evening, in a landmark ruling that Supreme Court today legalize abortions. In 1973, in a case called "Roe V. Wade" the Supreme Cort rules that abortion, which has been only legal in 5 US states, would now be legal nation wide. Precisely the opposiste of what happened in Romania, The legalized abortions in 1970s, was one of the prime reason why crime felt in the 1990s. Because the whole generation of unwanted children were never born, because of legalization of abortion. If you fast-forward 20 years to the point in time when they were going to be their peak crime ages, they simply weren't there to do the crime. You see George, you really had a wonderful life. Don't you see what a mistake it would be to ... throw it away? The trouble, of course, is that life isn't like the movies. For so many children who without "Roe V. Wade" would have been born in 1973, their lives might not have been a wonderful life that've been born in a loving family, in yesterday's small town America. Rather, they'd be a far harder road - been born into a potentially unwanted household in American's crumbling little cities, or forsaken heartland. Levitt's conclusion: "As much as half of the 1990s crime drop, was an unintended consequence of Roe V. Wade." The theory behind it was quite simple, Unwanted children, have been shown to be at high risk for crime. With legalized abortion, fewer unwanted children were born. Therefore, the theory would be that there'd be less crime in 15-20 years later. When those quahogs reach their peak crime ages And the data support that hypothesis,quite strongly. If you follow the data, there were 5 states that legalized abortions, 3 years before "Roe Vs. Wade" and about 15 years later, their crimes begins to fall, Then if you look at states where abortion was not just legal, but is available to people who wanna get them ... ... 16, 17 years after "Roe Vs. Wade" you see a 30% difference between the states doing a lot of abortions and ones that are doing very few. Finally, all of the effect we see in a in a diverse in crime, all of that is concentrated among people under the age of 25. People young enough to have been exposed to legalized abortion. People older than 25, here's no difference whatsoever between the high abortion state and the low abortion states. And I think in some way that's the best evidence we have, that legalized abortions is responsible for a big chunk of the decline in crime. Levitt's controversal theory has provoked strong reactions among critics. Is he, for example, avocating abortions as a crime fighting tool. In no way, would I take this as advocacy in favor of legalized abortion. I don't think anyone's opinion about whether abortion should be legal or not should be affected by our result. Some of Levitt's critics suggested that his theory holds what might have been classed a racial implications. He argues though that raising class has nothing to do with the matter. That his theory targets no specific group, other than mothers-to-bes of all backgrounds. And since, as Levitt points out, women who're led to abort go on to become child bearers consistent with the general populations. Levitt's argument could thus be undertood to suggest that legalized abortion does not so much prevent birth, as delay it. This turns an unwanted birth by a too young mother, for example into a wanted birth by that mother when she feels more ready. So, if Levitt is not advocating abortion as a crime fighting tool, what is he advocating? Well, whether one is pro-life, pro-choice or somewhere in between there's a meaningful and today unpeached connection between giving women the right to choose and the reduction in crime. We started offin a normal interview post and now you're lying down, swinging a pillow aaround What ... What's going on here? If I give you a slice of juicy fruit, will you say whatever I want No No?! Wait, I heard that you'll do anything for a slice of juicy fruit No matter how smart you are, and I kind of think they're pretty smart, you come up with some incentive scheme that you think is a perfect one to enties the behavior you have in mind. And you send an army of people with nothing to do all day but to figure out how to beat this incentive scheme -and absolutely it'll be beaten -Well, tell me about ... ... about Amdanda This is a long story I'll give you an example, so We were trying to potty train Amanda and my wife went books and did all the things you're told to do Amanda had been potty trained and she just decided she wouldn't use the toilet ... anymore. And this went on for months, my wife was frusttrated. And I said, I'm an economist, I understand I'll take over. And I got right down on Amanda's level on my knees and I knew what ... she likes more than anything else, she's about 3 years old, were MMs. And I said,"If you go pee pee in the potty, I'll give you a bag of MMs." she said,"Right now?", I said "Yeah". said,"Ok"; and she hopped on the potty went, went to the bathroom I turned to my wife and said,"Let the economist handle it, you know." And indeed, for the next couple of days, it worked to perfection. And everytime she has to go bathroom, she announced it. She went to the bathroom, we gave her the MMs. Everything had gone great. But 3 days later, she said "I have to go to the bathroom" She went and took a lot of few drops, I gave her the MMs She got off, she said "I have to go again" She sat down the potty, taking a few more drops, I gave her the MMs. "Got to go again" Basically, in 3 days she's gone from someone with no blatter control to a pro that she can complete control the flow at a whimp And had a 3 year old had basically come up with a way to beat the incentive scheme I had developed ... ... within 3 days. In a million years I would never have imagined. If an economist can't trick a 3 year old for more than 3 days, What hope does an economist have tricking the whole country for even 3 hours? So, that's kind of the beauty of incentives You don't really know what works and government think they know what works and they spend a huge amount of resources establishing incentives and they gonna do all these things seem to make lots of sense it sounds really great and may work out well in some measure But they're gonna backfire in so many different ways That we can't predict yet. And people will claugh and people will cry. And that's what incentives are. CAN A 9TH GRADER BE BRIBED TO SUCCEED? ITE103 What you guys putting in this? Get it right over there, you wanna do it right now. Right now you stupid ass. Clear! It's going That was nothing Make another one. I know I can do good in school but I don't I have a reputation of bad child Parents are way too uptight in kids' business, like ... Where you gonna go? What you doing? When are you coming home? It maybe like "Hey you have homework?" and I'll say "No" or "I forget my books, I'll do it in the morning." -That works? -Ah huh Gets them off my dick What's up? Hopefully, I'll mkae it to highschool if I fail I guess I'll try to get a GED through the millitary or something I have no clue ITE104 In the modern economy, not graduating from highschool, is like an economic death sentence. When you talking about highschool kids, what matters to them is what happens today, a month from now or 6 months from now. You have a very forward looking mindset I think ... most kids are dull In designing incentives to help kids get through school, we've got to have that conundrum in mind The idea was for the University of Chicago to see if students could increase their test scores simply by giving them a financial ... incentive. If it works for 1 student, then it's good enough for me because we have no stake in it financially. The University of Chicago is picking up the tab. Why wouldn't we at least try it? I'm thinking, it's going to work. Opportunity - you'll always miss 100% of the shots you don't take. And, that's my message to the students. I don't need to put my degrees up on the wall, I already have those. I want them to get those. How has it been starting a new school? It's actually not that bad, I like it here -Yea? -It's really easy -Oh the classes are really easy? -Oh, yea Let's see, pull out your report card and see how you're doing right now. -So, we can see your grades -Yea, not that good Alright, so what do you need to improve on? Everything Ok, but you know I'm seeing grades go up a lot so ... ... so you'd probaly wanna know what to get right, if you ... do meet the monthly achievement standards?! -Sure -Ok, so open up your folder Fifty bucks? Yea, you get the $50 every month as long as you keep your grades up Alright I think a lot of people here are gonna do their homeworks then -Yea, what about you, why you? -$50 can buy a lot ...ah -It can buy -You know, it can pay for my skateboards So then I could get sponsored, get free clothse and stuffs. Till I graduate -How's school today, ok? -Amazing -Good Kevin came home from school and says, "Mom ..." " ... if I do really good, I can get paid for it." Mom, I could really make money. I'm like, "Fine, Kevin, go for it." I said, "And I'll tell you what, you keep your grades up ..." "you're gonna get the money, .... mom will double it." Whatever they give you, mom will match it. -Alright -Then you'll have double the money. -If the grades go up -Right A little bit of bribery? What parent doesn't do that?! We all bribed our kids one way or another -One, two, three, four,five -Bribery works for my kids They love to be bribed -Eight, nine, ten For 50 cents, I can buy whatever I want in my household Oh I forgot this dollar The closest thing to figurig out habbits is that incentives matter Not just financial incentives but social incentives and moral incentives. Our goal was to figure out: Can we cheaply and quickly move the needle at a school? Can we get kids to achieve more as quickly as possible with spending very little money. There are 900 freshmen in our experiment, At the end of every month, we hold a payout event where all kids who got all Cs or above receive $50 in cash. In addition, those who quality are also elegible for lottery, where they can win $500. To win the money, They have to have no more than 1 unexcused absence No all day suspensions And all your grades at the end of the month have to be a C or higher It's great to give them this financial reward, but it's also about having a lot of fanfair around it Giving them this big checque, sending them home in a Hummer limo. You think, there's definitely a limo effect. That is so cool Are you serious?! They got to ride in it?! Aw, that is so awsome! Oh My God! This is awsome! Oh yes, yes, you're getting straight As from me. Yes! There's lot of things I'd do for money I mean I work all year round Hi, I'm a representative of .... we charge $3 for a walkway and $5 for a driveway would you like to hire us for our services today? Hook, line, and sinker They say money doesn't buy happiness, and I agree but I disagree. Depends how you look at it, Because when they say money cannot buy happiness, they're saying materials things cannot make a person happy. Wanna bet? Okay, BPL083, unfortunate that person did not meet the standards this month we cannot give them the money. You know what you need to do next month, right? -Yea -So you think you'll be meeting the standards next month? -Oh yea -Alright -I took a look into the limo thing and I was like ... Oh, you've seen the limosine outside? It was awsome! The lights, the way it was layed out ... Take us home, Jekins ... it's gonna be so cool! These are my halls! These are my halls! Cuz I'm a King that's my last name. The King~ -5 or 7 of prime, so that's ... -Write it! -Show your work -5, you can't break down 5 because it is a prime number Show your work ... I need you to ... do -I'm gonna do 7 through 12 -No, I said 1 through 6 You don't get to pick It's really important for me for him to finish school, because I didn't. He's very intelligent, he needs to focus. They got to find something to get these kids into going to school and get their grades up. Hello? Hi, my name is Eliah, I'm calling on behalf of the Chicago High School Is Guela Lupaia available? Is Hector available? Is Mark available? This is a message for Jessica Richardson, wanted to congratulate her on meeting the monthly achievement this month so she's eligible to win $500 And also, just let you know to have her keep an eye on her math and biology grades cuz they're on a C right now. Hi, this is Sally Sladoth from the University of Chicago, Is Kevin Muncy there? Hi this is Kevin Hi Kevin, I'm looking at your grades, and it looks like you need to bring some of them up, are you doing something to work on bringing up your grades? I'm not gonna lie, I haven't done every assignment, so far So are you going to your teachers and ask if you can make up the missing assignments? Ah yeah, they're actually making a list for me right now. -That's great, so you gonna try to make those up -Yea Cuz the thing is if you can trun in missing assignments, you can bring up the grade a lot. because you go from having no credit for the assignment, to getting some credit or even a lot of credit -that'll make your grades bounce up a lot. -Yea -So, you going to get the $50 for this month? -Are you gonna be doing your best? -Yea Alright, that's what I like to hear -Alright, take care, have a good day. -Alright, you too, bye. -Bye Huh, what? what? what? what? Go duct tape him. Little drawing over here, chromosomal #21, down syndrome are clear So, if you have normal splitting, this is what happens, we're making sperm here .... -Mr. Garshorn, can you Tyler come help me? -Sure You just wanna copy Lindsey's? No, just tell her to come back here. Lindsey Do you have that? Congratulations, you met the standards Congratulations, you get the $50 this month. -Unfortunately, you didn't meet the standards this month -Great It's just on the grey category, you need to bring up these ... grades to ... to be passing So, let's take a look here ... Algebra you're passing that's good So, what's going on in Biology and World History? Are you missing assignments? His history teacher said he should be in his honor class but the simple fact that he's not doing the work, that's why he's not there. Have to do the work. The trouble between me and my mom is mostly about homework. Because, the way it is with her she's always "When I was in school, ... " ... we have homework everyday." And I'm trying to get her to understand it's 21st century. That was then and it is now. Teachers are now more lenient, and no offence, care less ... Ok, so what do we have? I think the results are great this month, where you see the control at 28, then all the treatment at 36-38 So, that seems great to me, you know ... When you go from 28-37, -Right -I mean you're talking about ... ... close to a 30% increase right? So, seems like we are taking all the D kids to C -and we're not doing anything for the E kids -Right The question is the kids moved from D to C this year, are they gonna have a better life? -Right -I don't think we've the answer to that, overtime we'll find out ... But I've definitely been surprised by how important ... ... how well the parents groups are doing that ... ... parents still make a difference in 9th grades it looks like. Mom, I took a quiz on this book the Maken TerryBerry book, I took a quiz on that Did you read the book? I read the book Did you? I read the book, I read the book, I read the book but I ... -Did you READ the book? -Yes! Cuz we have to search and read to find the answers we have to read the book to find the answers So, stop Did you read the book or you just skim over the book? ... to find the answer to the question that you were looking for? Because, there's a difference We read it as a class, but when we took the test ... he gives out the page and we have to look for the answers. Did you read the book without the class? Did you read the book from cover to cover? -Not from cover to cover -So, you didn't read the book -We have ... -You didn't read the book! -We didn't ... -You didn't read the book You didn't read the book from cover to cover, outside of class, with no help, no instructions from your teacher along with your classmate, you didn't read the book that's why you failed the test. Look, I made a tattoo gun out of toothbrush and I was giving myself a tattoo in class -You have a tattoo? -I'm giving it to myself I only did like a little bit I got to do it a lot better I can't let them see cuz I'll get into trouble, but ... I made it out of toothbrush, and then just turn it on I made it out of guitar string I don't think I'll take money for giving up my social life I wanna be the class clown I'm doing better cuz I went up 6% to ... almost a D He always likes to be the class clown, always likes get the laughing; impressing everybody around him That could be his incentive But you'd think that ... to impress everybody around you, your grade will be with that too. He's got something in the mail that showed the list of all his grades E,E,E,E,E ... and I said, oh he's enjoying 9th grade he's doing it again, so ... Now what I need to do, is ... ... whenever he asks me for money now, he's not gonna get it. End of story. Yea. when the skateboard running out of wheels or getting bad ... Well then, just grinding them down, or hit the books or soemthing Urail, what does it mean to say a genotype is homozygous -When all the "aline" are the same -When all of the Alios are the same This is my last chance to win $500 I'm at the line, I'm splitting ... splitting a hair. My brain's been going up and down. There's always something that'd distract me. You know what I mean?! What's distracting me was ... trying to be cool ... ... trying to keep up with the Johnsons basically. ITE103 Congratulations, you made the standard achivement for the last month. So, here's your report card and the bracelet. Here's the front and here's the back. Congratulations Great grades. If I fail, I'm done, I'm dropping out. Army, marines, coast guard, go to Iraq or something like that. I've no clue. -Urail King -Yes! Take us home, Jekins What are the final results are like? Our program is getting 35-50% more students to pass 9th grade. We sure expect a lot higher rates than that. We hope for a lot higher rates than that. If we give them $50k ... to pass the 9th grade ... what share do you think would pass? Would we move 10% of the kids? 20% of the kids? All of them? I don't know I think we need to, attack the problem at a ... much younger age ... the dollar will be better spent during the earlier years So what are we going to do next year? What about preschool, did they find a preschool yet? Yea, we've got a few perschools lined up and they seem excited. So, we're talking about preschoolers ... are we talking about taking parenting out of the hands of parents? Or teaching the parents how to parent? Or both? It's a little bit of both. That could be fun. The way I see it, learning is like a virus. a virus that most adolesents don't want to catch ... ... until later on in life. Next year, I'm gonna be a sophomore. I'm gonna tell you, I'm doing great and I'm getting As and Bs. Next year when I'm gonna be a sophomore. If not As and Bs then straight Bs ... or Bs and Cs. Hey, that's difficult, that's not as easy as it looks. I can promise you milk and cookies, but if ... ... the oven is broken then you just gonna get milk. ITE104 Our incentives, unlike everyone else's, are to be honest ... If we build our reputation on, we're honest about this issue, and other issues .... ... then people will believe us about everything. The worst thing we could do, the only way we can ruin our reputation ... ... is by starting to take sides and fights. This peculiar beast, which actually has the right incentives, you just seek the truth. And not have an agenda. So, I don't think, anything we've ever written or thought is gonna save ... any lives really, or ... make people better or smarter anyway. But ... ... we kind of give people permission to challenge conventional wisdom sometimes ... And ask a different kind of questions entirely ... and a lot of times the sort of questions you ask his children, and ah, people kind of chuckle at you. But once in a while, they turn out to be rather good. The problem is, as you get older, you ask them as adults in a meeting or friends, they'll laugh at you hard and you stop entirely. And we just kind of keep doing it. We kind of say, what if this thing everybody think is so really isn't. What if that didn't cause this, what if this cause it? I think that's just need to be a lot more permission for people to think like that Total bs, was't it? -=End of movie=- |
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