The Upside of Quitting (Ep. 42)
You know the bromide: “a winner never quits, and a quitter never wins.”
To which Freakonomics Radio says … Are you sure? Sometimes quitting is strategic, and sometimes it can be your best possible plan.
That is the gist of our latest Freakonomics Radio podcast, “The Upside of Quitting.” This is the last of five hour-long podcasts we’ve been putting out lately. Some of you may have heard them on public-radio stations around the country, but now all the hours are being fed into our podcast stream. (You can download/subscribe at iTunes, get the RSS feed, listen live via the media player above, or read the transcript here.)
To help us understand quitting, we look at a couple of key economic concepts in this episode: sunk cost and opportunity cost. Sunk cost is about the past – it’s the time or money or sweat equity you’ve put into a job or relationship or a project, and which makes quitting hard. Opportunity cost is about the future. It means that for every hour or dollar you spend on one thing, you’re giving up the opportunity to spend that hour or dollar on something else – something that might make your life better. If only you weren’t so worried about the sunk cost. If only you could …. quit.
There is a large cast of characters in this episode, ranging from prostitutes and baseball players to former government officials and a couple of Amish women who left the fold. You’ll also hear Steve Levitt talk about his quitting strategies, and I describe my life as a serial quitter, having abandoned, in order: the rock band to which I had devoted my youth; Catholicism; and The New York Times.
Some other folks you’ll hear from:
Sudhir Venkatesh, the Columbia sociologist (and blog contributor) whose research we wrote about in both Freakonomics (“Why Do Drug Dealers Live With Their Moms?”) and SuperFreakonomics (“What Do a Street Prostitute and a Department-Store Santa Have in Common?”) has lately been doing a lot of research into quitting. So we brought him aboard for this hour to talk to two groups of workers whose skills are perishable and yet have a hard time walking away from their jobs: prostitutes and baseball players.
Along with one of his students at Columbia, a former ballplayer named Justin Humphries, Venkatesh took a look at the socioeconomic background and outcome of the 2001 baseball draft class (which included Humphries) and found that, for many of them, sticking it out for years in the minors amounted to a poor economic decision, at least when compared to observationally equivalent young men:
VENKATESH: “The average player probably looks like an upper-middle-class kid who comes out of college or comes out of high school. And when you follow an upper-middle-class kid for about seven to ten years, they’re probably going to make higher than the median average income. They’re probably going to live in a neighborhood that’s relatively safe. They’re going to have a career. Now, when you take the counterpart among the pool that was drafted, that median kid, that kid looks likes he’s making about $20,000 to $24,000 a year, which is not a lot of money. He’s working probably five to seven months playing baseball, and then struggling to find part-time work in the off-season. Might be coaching, might be doing some training, might be working on a construction site. Might be working in fast food.”
Not so many years ago, Justin Humphries was considered one of the best young baseball players in the country – a big power-hitter from a suburb of Houston. Getting drafted by the hometown Astros was especially sweet – and they threw in some money for education, for later. But Humphries wasn’t thinking about that. He had one goal: to make the majors. But in 2009, after a few injuries and a lot of minor-league stops, Humphries quit baseball at the ripe age of 27. Roughly 10 percent of the American ballplayers who get drafted each year will ever make the majors; but probably close to 100 percent of them think they will.
HUMPHRIES: “Well, when you’re 25, playing in independent ball, making less than $2,000 a month. Living off your parents because you can’t financially sustain yourself like that. At some point you have to say to look…with no degree. I had less than an associate degree at that point. So, at some point, you have to tell yourself, ‘I can’t do this to myself. I can’t do this to my parents. And I can’t continue …when I know that there’s untapped potential to do other things.'”
You’ll also hear from Robert Reich, the U.S. Secretary of Labor during President Clinton’s first term. He helped put in place the Family and Medical Leave Act; he raised the minimum wage. On his watch, unemployment fell below 5 percent –- the lowest it had been in 20 years! It’s hard to say how effective any one person in Washington really is, but Time magazine named Reich one of the 10 best Cabinet members of the 20th century.
REICH: “Well, I decided. … I mean, this was long in coming. I was feeling more and more miserable about not seeing my kids, it was weighing on me to a greater, and greater extent. I made the decision that shortly after the election I would leave. And then one day I went into the Oval Office and explained to the President that I just felt that I had no choice. He was very understanding about it.”
Among the academics you’ll hear from in this episode: Carsten Wrosch, a psychologist at Concordia University in Montreal, talking about the benefits of giving up unattainable goals; and Hal Arkes, a psychologist at Ohio State University, who talks about how badly human beings weigh sunk costs (even worse, it turns out, than animals and children).
And we talk to quitters from A to Z, quite literally: a pair of former Amish women and a Zappos employee who took the company up on its famous cash bonus for quitting. The ex-Amish were particularly interesting to hear from. One is Saloma Furlong, author of Why I Left the Amish; the other is Emma Gingerich, who’s working on a book to be called Runaway Amish Girl.
You’ll also hear from Eric Greitens, who got a Ph.D. in politics from Oxford and then joined the Navy SEALS. He fought in Iraq, Afghanistan, and elsewhere, and has now has written a book called The Heart and the Fist: The Education of a Humanitarian, the Making of a Navy SEAL. Greitens talks to us about Hell Week, during which the Navy weeds out the SEALS from the wannabes:
GREITENS: “It is a week of continuous military training during which most classes sleep for a total of two to five hours over the course of the week. During Hell Week, they have you running for miles on soft sand on the beach, doing two-mile ocean swims, running the obstacle course, they put you on small teams and ask you to land small rubber boats on jagged rocks in the middle of the night. There are all of these tests which are designed to push people to their physical, mental and emotional limits. … I don’t think many people want to say to themselves that they’ve quit. At the same time, we’ve all failed in our lives, we’ve all failed at different things and I think there’s a lot to be said about facing that failure squarely. And the people who I know, who are able to admit, “This isn’t the right for me at this time and I went over and I decided to quit, I decided to ring the bell,” they’re really able to move on from their experiences. And I do find that there’s only shame in it if you feel shame.
And best of all, I get to talk to Jon Wurster, one of my former bandmates from The Right Profile. (Here’s a song of ours, called “Cosmopolitan Lovesick Blues.“) Not long after we signed to a major label, I decided to quit. Thankfully, Jon kept playing music — with, among others, Superchunk and the Mountain Goats. (He is also a titan of comedy.)
Hope you enjoy listening to this episode as much as I enjoyed making it. You might, of course, quit listening right in the middle.