Tyler Cowen Practices Reverse Psychiatry
By Arnold Kling
I did not go for this inducement, but nonetheless found myself holding an advance copy, sent by the publisher. More thoughts below the fold.
The ubiquitous Bryan Caplan, guest-blogging for The Economist, says that of the various Freakonomics wannabes, Tyler has an edge.In the introduction (p.7), Tyler says,
It should be possible to take a good economics argument and write it out on the back of a moderate-sized postcard. If an argument has too many steps, at least one of those steps is bound to be radically uncertain.
The same might be said about a book review. I think that my postcard-sized book review would go something like this:
Tyler Cowen’s book is for two audiences. Non-economists will learn how to appreciate incentives and scarcity in a variety of settings, including choosing a restaurant or developing a taste for art. Economists will learn how to appreciate the indispensability of emotion in many settings, including our need to feel in control and to over-rate ourselves. The style of the book is relaxed, meandering, and conversational. Think of reading this book as like going to Tyler for a therapy session, except that he practices psychiatry in reverse. You lie down on the couch and listen to him talk about whatever is on his mind.
My favorite example of economic reasoning is tucked away in a chapter called “How to Save the World” (p. 209)
Let’s say everyone tipped 25 rather than 15 percent. What would happen? The market for waiters is competitive, and most waiters are paid what they are worth, no more or no less. If customers pay waiters more, employers will get away with paying them less.
My favorite passage on emotions is in the chapter on self-deception (p. 116):
The experts delude themselves too. Ninety-four percent of polled university professors thought they were better than average at their jobs, compared to their colleagues. A survey of sociologists asked each professor how much influence he expected to achieve. Almost half of the sample of 198 expected to become among the top ten leaders in at least one of their specialties. More than half expected that others would read their writings even after their careers had ended. This same group could not identify most of the previous presidents of the American Sociological Society…
A few pages later:
The depressed, even though their thought processes are often quite irrational, tend to have more accurate views about their real standing in the world. They are more likely to admit that in various fields of achievement they are no better than average…
And near the end of the chapter:
The fiction of a truly objective person would probably be a robot with no emotions and real sense of self–who would want that, either for herself or for others?
Nonethless we should all strive to become, at the margin, less deluded on critical issues…