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Steve LEVITT: Hey, Dubner.
Stephen J. DUBNER: Hey, Levitt. How’s it going?
LEVITT: It’s going good.
DUBNER: So, are you feeling recovered from book tour yet?
DUBNER: I thought it was interesting, as much as you whined and complained on this podcast about how much you hate the book tour, it actually worked out beautifully, didn’t it? Do you want to tell the people how beautifully that worked out?
LEVITT: Oh, so everywhere we went, people were very gentle with me. They gave me presents. Thank you very much for the coffee and thank you very much for the In-N-Out Burger gift certificate that I used.
DUBNER: Bacon. There were plates of bacon on stage with us when we gave talks.
LEVITT: And poor Dubner took the brunt of it; everybody slapped you around and let me do my thing. It couldn’t have been better.
DUBNER: They were like, “Oh, Steve Levitt, thank you so much for coming to San Francisco. I know you don’t like to leave your room.” That was a great piece of game theory because you have no problem getting out there. You like to talk to people. You say you don’t.
LEVITT: No, I like to be in my room.
DUBNER: You say you do.
LEVITT: I only like to be in my room.
DUBNER: Now, what would you say would be a highlight of the book tour or a lowlight. It could be either.
LEVITT: Um…let me think. The other day a stranger rolled down the window of his car and yelled to me, “Hey, I loved the tipping podcast.” That’s bad, that’s when we’ve got to retire when strangers are rolling down their window and knowing who we are, that’s when we’ve got to be careful.
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ANNOUNCER: From WNYC, this is Freakonomics Radio, the podcast that explores the hidden side of everything. Here’s your host, Stephen Dubner.
Steve Levitt and I just got back from our book tour for Think Like a Freak. Honestly, it was a blast. Yes, long days, lots of travel — but c’mon: big auditoriums full of people willing to sit and listen to what you have to say? Not bad. The most surprising thing was when we started asking the audience how many of them regularly listen to the podcast. About 90 percent of the hands went up — whether in New York or California or the U.K. It was amazing! Although it did make me wonder if we didn’t make this podcast, if our book tour would happen in much smaller auditoriums. So thanks for coming out, thanks for listening — and thanks for sending in your questions for this first installment of our Think Like a Freak book club. We’re starting today with Chapters 1 through 3. Chapter 1 is “What Does It Mean to Think Like a Freak?” Chapter 2 is called: “The Three Hardest Words in the English Language” — also known as “I don’t know,” and how our reluctance to admit what we don’t know keeps us from learning. And Chapter 3 is called “What’s Your Problem?” in which we encourage readers to redefine the problem they are trying to solve. And remember: If your question makes it onto the show, we will send you your choice of an autographed copy of Think Like a Freak or a limited edition, Think Like a Freak t-shirt. So listen up!
DUBNER: So, Levitt, let’s start with Andrea Kate Crary from Fargo, North Dakota. Andrea writes, “You asserted the most important idea in your new book is the underlying principle that to think like a freak you must in fact think. I heartily agree with you on the importance of thinking, and wonder if you have any suggestions on how? It seems to me that my brain defaults to autopilot. Is there a way to reset my brain’s default position?” Levitt, what do you say to Andrea?
LEVITT: I would say to Andrea that I think autopilot is indeed the right default for the brain because the world’s too complicated and there’s too many things to do to try and really think your way around everything. What I would suggest Andrea try to do is at certain moments when it seems like the marginal benefit of thinking is high she should see if she can switch her brain into a thinking mode. And then kick in the thinking when it really will be to your advantage. And so, for instance, part of thinking is just finding the quiet time to do it. And so maybe a place to start would be when you see problems or questions that you think might use thinking, file them away in your brain, and when you have quiet time when you’re doing laundry or you’re trying to rock a baby to sleep or something like that, then take those moments to actually go back and try to engage your brain. And just do it a little bit at a time, and see if anything good comes out. I mean, good ideas are hard to come by. Dubner and I spend a lot of time thinking and we’re lucky if we have one or two good ideas a year. So I think the expectations shouldn’t be too high.
DUBNER: Yeah, and I would also say to Andrea that it’s a great idea to just work hard to spend time with people that aren’t a lot like you, whether it’s vocationally, or age-wise, or politically, or religiously, geographically or whatever, because it’s amazing how simply doing that will change, or broaden, or give you an angle on a problem that you wouldn’t have considered otherwise. And the more we look at the way people group around groupthink and herd mentality, one reason it’s hard to come up with a good solution to a problem is you’re just hearing this kind of siloed echo chamber of everybody else that you hang out with. So if you can seek out people who look at things really differently from you, whether you’re an artist and you don’t hang out with data people or politically left and don’t talk to people on the right, etc., I think that’s a way to get a leg up.
DUBNER: Levitt, Michael Carley, who is associate director of the Institutional Research and Reporting something…at Kern Community College in Bakersfield, California, writes to say this, “I work as an educational researcher. How would we, in hiring employees for our department, find those with the humility to say when they don’t know the answer to a question? A lot of time is wasted when employees plod along in ignorance rather than admitting limitations.” Levitt, you have some kind of good trick for employers to screen for that ability?
LEVITT: Well, the first thing that comes to mind is in the course of the interview, what most people do is fake their way. There’s a general sense, and it came up on the book tour three or four times where people said, “Well if I say I don’t know I will never get the job.”
DUBNER: And you’re sympathetic to that issue.
LEVITT: I do think that actually it probably is true. If the people who are hiring you are of the mind that you should never, ever say I don’t know when they themselves never ever say I don’t know, then saying I don’t know is not a great idea before you get the job. Now, once you have the job you have a little bit more time and leeway to try and change people’s views and to show people that when you say I don’t know, and then you go back to the data and you figure out the answer, and you come back a week later, or an hour later, or a month later, and say I now know, that people will be impressed and will come to respect you more. But you don’t get that second chance, you don’t get that week or the month if you’re doing the interview. But clearly, if you want to attract people who will say I don’t know, the interview process is the right way to do it, or even before that in some sort of an online application to ask the kinds of questions which will elicit different answers from people who are liars and fakers and people who aren’t. I mean, the example we give at the beginning of the chapter on, “I don’t know,” is about children, and they’re asked in a psychology study to respond to questions, which they simply can’t answer given the–
DUBNER: Patently unanswerable questions, right?
LEVITT: Exactly. And so one could imagine asking completely unanswerable questions in an interview and seeing how people respond.
DUBNER: Hey, let me ask you this, what about combining two, two ideas we’ve talked about in the past, unanswerable questions and the need to say, “I don’t know,” and kind of this burning desire to make predictions about any and everything. What about that? What about asking potential employees to make predictions, which you could kill two birds with one stone. You could see how willing they are to admit they don’t know, and you could see how they feel about this relatively impossible task generally of predicting the future.
LEVITT: I think that’s a good idea.
DUBNER: What’s the question you write, what do you ask them to predict?
LEVITT: I would say what the interviewer’s going to have for lunch that day. Because it’s completely stupid and pointless.
DUBNER: And unanswerable.
LEVITT: And completely unanswerable.
DUBNER: Although you could say you look like a pretty chubby fellow so I’m going to say you’re going to have some pasta.
LEVITT: But I think it’s the kind of reaction someone would have to that question, it’s so nonsensical that it’s a signal to anyone who has the common sense that you can’t possibly expect a serious response to it. I think it will pick up on other things, too, which is just common sense and the ability to understand how humanity works. If you ask some question about what do you think our revenues will be in the year whatever then it’s actually sounds like you could make a prediction.
DUBNER: Well it’s an invitation to fake it, too, whereas this one’s giving you the option to take the high road.
LEVITT: Yeah, now the other thing that interviewers always do, and I don’t know if this works or not, would be to say, could you tell me about a time in your career in which you have been faced with a question you don’t know the answer to and you simply said I don’t know and how did it turn out. That would be the more traditional way to do it, maybe you could do both.
Coming up on Freakonomics Radio: what’s the biggest reason that so many companies operate on gut instinct instead of using the data?
LEVITT: I never would have thought this before I started working with companies. I never would have imagined that it is an I.T. problem.
And one question that is truly inspiring for both me and Levitt:
LEVITT: I do love Glenn’s question. I think this is super smart and really interesting and important. I think it’s great.
And one more thing: If you are not already a subscriber to Freakonomics Radio — well, you should be. Just sign up, for free, at iTunes, and you’ll get the next episode in your sleep.
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Welcome back to the first installment of the Think Like a Freak Book Club. Today we’re taking your questions about Chapters 1-3.
DUBNER: Uh, Levitt, Mikhail Marchenko from Lenexa, Kansas, I believe, writes to say, “In your book you use a metaphor, a football player, meaning soccer playing that’s faced with a tough decision that can have a lasting impact on his professional career, the penalty kick.” So, incidentally, Levitt, have you caught World Cup fever? Are you watching hours and hours and hours?
LEVITT: I did watch that crazy game where Holland beat Spain 5 to 1.
DUBNER: Oh yeah. So Mikhail goes on to say, “You write that humans are motivated by myriad things, chief among which is pride and reputation. As you simply yet so elegantly,” thank you very much, “put it, none of us want to look stupid.” So this is about the difference between acting in your own interest versus acting in the public interest, to shorthand it a lot. Now, Mikhail asks, “Has there ever been a society that strongly believed in the greater good of the community and which punished those who went against the grain and acted to benefit themselves instead?” So, Levitt, I have to say my first thought was well that sounds a little bit like the Soviet Union, the former Soviet Union, which by the sound of his name Marchenko, Mikhail Marchenko, this listener is probably a little bit familiar with…I mean, it’s interesting to me that he didn’t bring it up, but it also brings to mind for me a lot of religious communities. You know, ultra-orthodox Jews even in 21st century America and a lot of the Anabaptist communities like the Amish, and Bruderhof and Mennonite. But Levitt, I’m really curious to know if you know anything about this, societies that kind of, you know, reward the communal, punish the individual goal-seeking and whether…Yeah, that’s all.
LEVITT: Yeah, I think you’re right, I think that was one of the premises of communism and socialism was to put the collective above the individual. But the problem with those systems is it’s very hard to incentivize individuals when the benefits go to others. If you think about it, corporations have a little bit of the same flavor. In many corporations, the financial incentives of individuals are not that strong, so the difference in the profit that accrues to the company can be 50 times, 100 times, my own private benefit of the actions that I take, and then it’s hard to incentivize people. I mean, maybe the ultimate society that has managed to succeed in putting the collective above the individual are things like ants and termites, right? Because I mean, that’s exactly what happens in these colonies. It’s because the ants don’t have enough brains to do anything different. But really I think in bees, I mean, bees sting and die because of it, but they’re programed to act on behalf of the community.
DUBNER: Since you brought us to corporations and corporate behavior, let’s go to, here’s a related question from someone named Tracy Lum who writes to say…And by the way, every person, so the minute you hear your name on this program, that means you’re going to get some Think Like A Freak swag, so you should be very happy about that, not just for the pride but for the avarice part of the mention. So, Tracy Lum writes to say, “You write that one of the reasons that people ignore data in favor of gut instinct is tradition and resistance to change. In an ever-changing, competitive, mostly capitalist economy, I’m wondering how and why these types of organizations and individuals survive?” So that’s really what you’re talking about, Levitt, to some degree, which is that in companies, corporations, the boss has a different set of incentives, perhaps, than almost everybody else. So tell us about that. You’ve been spending a lot of time in corporations consulting with them. Do you A: see a resistance to data generally, and if so do you see it higher or lower down the ladder? And do you think that there is a split between the incentives for the people in the corner office and the people on the ground?
LEVITT: So that’s a great question and I might challenge the premise. The premise of the question is that these old organizations that are resistant to data will survive or are surviving. But in fact, they’re certainly not thriving. And what I see all the time is the incredible difficulty that companies, and really people, because companies are made up of people, have in adapting to new situations. And it really, it’s really amazing. If you look back at what the 50 biggest companies were in the world 100 years ago, I mean, very few of them exist. Other people have looked at this, I haven’t looked at this in detail. But companies have very short life spans. Relative to, say, universities, the same universities that were the most highly ranked 100 years ago are still almost without exception, maybe Stanford has gotten better in the U.S., but in general, universities all stick around and companies don’t. And I think it’s because the university environment doesn’t change very much, but the corporate environment, what consumers want, and what producers make changes a lot. And it’s hard for companies to keep up. What I really believe, though, is that the importance of data and the availability of data has gotten so much greater. And the ability to do experiments, that the new wave of companies, companies like Amazon that do experimentation are just going to devastate the old way of doing things. And the world is changing, it’s not just because of data, it’s not just because of experimentation. But there happens to be a correlation between the kinds of companies that are new and innovative and their use of data. And it’s absolutely transforming the landscape.
DUBNER: So that being the case, let me just go back to Tracy’s question, which you didn’t quite get to, you didn’t quite answer, which is why are…OK, let’s say you’re one of these non-transformative, hyper traditional firms and you’re presumably not an idiot. And you see that firms that don’t adapt will suffer and that part of adapting is to let go, you know not to rely necessarily on gut instinct that’s informed by tradition. Why is it so hard for leadership to change? That’s really the question that Tracy’s asking.
LEVITT: Yeah, I think the hardest single thing is that even if you have the desire, which you may or may not have, to be data-driven, that the existing systems…I never would have thought this before I started working with companies. I never would have imagined that it is an I.T. problem that you simply cannot get the data you want, and the data are held in 27 different data sets that have different identifiers, so you simply…So sometimes when my little consulting firm TGG comes into a company we’ll spend something like three or six person-months working with a company of trying to just put together a data set to do a basic analysis that I think many listeners would think wow I would think that a big, fancy company would be able to do this with the push of a button. But it really is… the I.T. support and the complexity in these big firms blows your mind about how hard it is to do the littlest, simple things.
DUBNER: Levitt, um, so let’s end with one more question here I think is a nice ending. Glenn Hall writes to say, “I read the chapter of Kobayashi.” That’s Takeru Kobayashi. “And how he smashed the hot dog eating record. I noted your comment about how he didn’t think about the previous world record of 25, or else he may have stopped at 28 or 30 instead of making it to 50.” We don’t say he would have stopped at 28 or 30, he just wouldn’t have been able to get so high if he had honored that barrier of 25. So Glenn continues to write, “I have been thinking about this for quite some time in regard to a person’s chronological age. In the United States, the retirement age has remained at 65 in spite of the large increase in life expectancy. Does this set up an artificial barrier relating to a person’s productive life? I am well into middle age, yet the idea of an end game at 65 has never entered my mind. How much of the aging process is physiological and how much is psychological due to culturally-induced artificial factors, such as the 65-year-old retirement age. I am currently engaged in an experiment trying to ‘think myself younger’ and it seems to be working.” That’s what Glenn Hall writes. So, Levitt, I have to say, I love this question. I love the idea of artificial barriers and ignoring them. And I know you, kind of, you’re not so keen on that idea yourself are you?
LEVITT: I’m not as keen as you are, but I do love Glenn’s question. I think this is super smart and really interesting and important. I think it’s great. And it’s probably true. I mean, everything he says is true, that we set up these retirement ages decades ago when people were much less healthy and lived shorter. And, I don’t know… I think I do think that it’s easy when you’re an adult to just get caught in the trap of feeling old and getting afraid of everything. So I think a lot of things are under the control of people. And you see it all the time.
DUBNER: The thing that his question makes me think is that yeah, as you mentioned, longevity has increased so much. I think in the 20th-centuryth century life expectancy in the U.S. at birth doubled. Which is just an astron— That will never happen again. I think it’s safe to say that will never happen again. So to me one of the really interesting…
LEVITT: Wait, can I interrupt you on that?
DUBNER: Sure. Yep.
LEVITT: It’s not just longevity, it’s the state of your body at the time you’re 65. I think we’ve had at least as big of improvements…When you were 65 in the old days and you had worked in some kind of horrible factory 12 hours a day, you were completely broken. But now, I think people at 65 are great…
DUBNER: Well and a much smaller share of the population if doing work that’s so physically hard.
LEVITT: Exactly. It’s just a combination. So just working the farm. When you had to like…It was incredibly brutal work as you know having grown up on a farm. So it’s as much the increase in longevity as the state of the body and the quality of life that you can have at 65. But it’s a different question of whether it’s just fun to stop working and to do 100 other things that you couldn’t do when you worked. That’s just, I don’t think either of us is saying, no retirement is bad. I think that what Glenn’s saying, which is true, is there is no reason that if you love what you do in your work that you couldn’t still do it. My dad’s almost 80 and he’s still a practicing doctor because he loves it and he’s not sure what he’d do otherwise. And I think that’s exactly the right attitude. And my dad still runs three to five miles a day. And he acts like he’s young, and he is young. He seems young, you know… so… I think Glenn should get both a book and a signed t-shirt, whatever we do for that kind of insightful question. We didn’t give a great answer. I think his question is better than any answer we could give.
Okay, Levitt. We will send Glenn a t-shirt and a signed copy of Think Like a Freak. And we’ll send something to Tracy, Michael, Mikhail, and Andrea. So keep an eye on your mailboxes, people — and we’ll keep an eye on ours as well. Drop us a line at email@example.com with your questions for the Think Like a Freak Book Club. Up next will be Chapters 4 through 6. Those are “Like a Bad Dye Job, the Truth Is in the Roots,” “Think Like a Child,” and “Like Giving Candy to a Baby” — original title was “It’s the Incentives, Stupid.” So send us some questions and you’ll hear that episode in a few weeks. And next week, you’ll hear directly from Takeru Kobayashi, the hot-dog-eating champion, and you’ll learn more than you ever thought you wanted to know about the sport of competitive eating:
Takeru KOBAYASHI: [Speaking in Japanese]
Maggie JAMES: They said they that took me to outer space and some aliens, had given the man two stomachs. Um. Oh, he’s taking muscle relaxers.
DUBNER: That you were doping. Did you take muscle relaxers?
DUBNER: Do you have two stomachs?
KOBAYASHI: Eh. No!
JAMES: He thought about it.
Some limits are real, and others are just in our minds. Fifty hot dogs in 12 minutes? No problem! That’s next time on Freakonomics Radio.