“Emotions have historically received a bum rap from decision researchers” write economists John Ifcher and Homa Zarghamee. In a forthcoming paper called Happiness and Time Preference: The Effect of Positive Affect in a Random-Assignment Experiment, they address the tricky and oft-ignored role of emotion in decision-making. Their study measured whether positive affect impacts time preference – that is, whether people are more patient when they’re happy. They found that people are indeed more willing to wait when they’re in a good mood. As an individual’s rate of time preference affects the actual decision they make, knowing the relationship of short term emotions to time preference points to how to nudge individuals to make long term decisions instead of short-term ones. (7)
First, special thanks to Superfreaks Dubner and Levitt for asking me to come back and answer some of your NFL questions. No, Stephen, I couldn’t help you with a Steelers victory on Sunday, but I hope you don’t hold that against me. I did my best to answer every question as candidly as possible. There are 21 days to go until a lockout and I’m stuck with a tissue box and all kinds of medicine trying to get over a Super Bowl cold. Let’s get to the questions so I can go back to sleep and get better.
Yes. Currently, it takes three years [of NFL service] to get five years of post-career healthcare. Given the dangers and risks of the game, it is important that we work to improve this. We can’t be in a situation where, five or ten years from now, we see former NFL players with similar or worse conditions than some former players live with now. We are learning a lot more about the risks and long-term impact on the human body of playing football. In a game where players don’t have guaranteed contracts and the average career is close to 3.5 years, this is a real concern for us. Now you know why players have been so adamant about not playing 18 games. Read more…
A month after Romanian authorities began taxing them for their trade, the country’s soothsayers and fortune tellers are cursing a new bill that threatens fines or even prison if their predictions don’t come true.
Fines or prison if a prediction fails to come true?
Witches argue they shouldn’t be blamed for the failure of their tools. “They can’t condemn witches, they should condemn the cards,” Queen Witch Bratara Buzea told The Associated Press by telephone. … Sometimes, she argued, people don’t provide their real identities, dates of birth or other personal details, which could skew a seer’s predictions. “What about when the client gives false details about themselves? We can’t be blamed for that.”
A lot of people who join gyms or health clubs find it very easy to stop going. Gym-Pact, a new program in Boston, aims to change that. “Gym-Pact offers what [co-founder Yifan] Zhang calls motivational fees: customers agree to pay more if they miss their scheduled workouts, literally buying into a financial penalty if they don’t stick to their fitness plans,”explainsSusan Johnston of The Boston Globe. “The concept arose from Zhang’s behavioral economics class at Harvard, where professor Sendhil Mullainathan taught that people are more motivated by immediate consequences than by future possibilities.” Gym-Pact launched a small pilot program last fall at Bally Total Fitness in Boston, and expanded its program at two Planet Fitness gyms in Boston in 2011. Currently, participants are fined $25 if they fail to follow the schedule in any given week, but Gym-Pact’s founders are still refining their model. ”Zhang and [Geoff] Oberhofer plan to tweak the fee structure to allow it to be customized to a customer’s goals. Future iterations may include a combination of discounted gym memberships and smaller penalties that apply daily rather than weekly.” (HT: Marginal Revolution) (13)
Bring on the Pain! It’s not about how much something hurts — it’s how youremember the pain. This week, lessons on pain from the New York City subway, the professional hockey rink, and a landmark study of colonoscopy patients. So have a listen. We promise, it won’t hurt a bit.
Most people do what they can to avoid pain. That said, it’s an inevitable part of life. So how do you deal with it?
That’s the question we explore in our latest Freakonomics Radio podcast (you can download/subscribe at iTunes, get the RSS feed, listen live via the link in box at right or read the transcript here). We look into a few different kinds of pain, inflicted in different circumstances, to see what we can learn. The biggest takeaway: it’s not necessarily how much something hurts; it’s how youremember the pain. Read more…
I’m lecturing at the University of Essex and going from office to office chatting with people about their research. This is hard physical labor — I repeatedly go down one or two flights of stairs in this rabbit warren, walk down a hall, up the stairs in the adjoining building, then back down another hall. What a waste — why?
The answer is that the British government imposes a value-add tax on building extensions, so that if the buildings are joined on each floor, the extension is heavily taxed. To avoid this, the University struck a deal with the taxman to allow one internal door between adjoining buildings, allowing what is merely an extension to be treated as a new edifice and to escape taxation. The only problem is that, as usual, taxes create a dead-weight loss, as my well-exercised, tired knees that feel like dead-weights now illustrate. I doubt the building’s planners considered the cost of this loss when they agreed to this tax-avoiding subterfuge. (HT: SP)
A wealth manager I know sends out a quarterly letter to clients that summarizes his view of the economy and his resultant investing plans. Here’s a nice paragraph from his most recent letter:
A key to any short-term outlook is what Americans are thinking. Most have been very wary about the upturn, given the widespread talk about the decline and fall of the United States; almost half of American people think the U.S. has already been surpassed by China in economic progress. (Actually, the average Chinese family has a small fraction of the income of the American one.)
Sometime in the late spring, our second book, SuperFreakonomics, will be published in paperback. As with Freakonomics, we’re going to add some bonus matter to the back of this edition. And, as with Freakonomics, one thing we’ll include is a Q&A in which we answer questions from readers. And where do these questions come from? You! So ask away in the comments section; here’s your chance to be a published (albeit unpaid) author. Posted below is the Table of Contents from SuperFreak, but feel free to ask questions unrelated to the content as well. Thanks in advance.
An Explanatory Note …………………………………………………….. xiii
In which we admit to lying in our previous book.
Introduction: Putting the Freak in Economics …………………….. 1
In which the global financial meltdown is entirely ignored in favor of more engaging topics. The perils of walking drunk . . . The unlikely savior of Indian women . . . Drowning in horse manure . . . What is “freakonomics,” anyway? . . . Toothless sharks and bloodthirsty elephants . . . Things you always thought you knew but didn’t.Read more…
The pace and flow of soccer generally make it difficult for managers to affect the outcome of a match once it begins. Since soccer has almost no stoppages for coaches to draw on clipboards or strategize with their players, a manager’s most critical in-game decision may be choosing when to utilize their three substitutions. … Read more…
Camerer: No. Here’s why: I am one of the world’s leading experts on psychology, the brain and strategic game theory. But my wife is a woman. So it’s a tie.
Szuchman and Anderson have agreed to field your questions related to the ideas covered in their book, so fire away in the comments section below and,as always, we’ll post their answers in short course.
This week’s Economistexplains why the German economy has outperformed most other wealthy nations in the past decade. It’s not because of a “wirtschaftswunder,” but rather a solid focus on the part of German companies, especially small ones, to utilize globalization to their advantageby finding niches and developing good outsourcing practices. The abundance of cheap labor, the recent liberal Hartz reforms and the demand for the euro don’t hurt either — but the main driver has been the cornering of the globalized supply-and-demand market. Germany also made several good bets during the worldwide economic crisis: while many businesses cut costs by firing workers, German companies retained workers and, thus, human capital. That said, the Economist highlights two areas where the German model has room for improvement: enhancing productivity and rebalancing growth to cut down on its dependence on foreign demand. (13)
Two good questions from a reader named Harold Laski, who is the medical director of Southside Medical Center in Jacksonville, Fla.:
As a physician treating injured sportsmen, I understand (or at least I think that I do), the reasons that people get into sports. But two things have bothered me. First the fact that many parents encourage their children, even at amazingly young ages, to concentrate on sports, so that when they get “big” they can earn lots of money as a famous sports person — usually, at least the ones I am in contact with, as football players. But from my limited standpoint, this actually does more harm than good, in that many children continue on through high school hoping to be that great sports hero, a hope that never comes to fruition. There simply are not enough places in sports that really pay compared to the number of people (students) who concentrate on the sports to the detriment of their education and end up with nothing. Has any study been done to show the true effect of the “sports craze” here and abroad?
In Wired, Jonah Lehrer profiles Mohan Srivastava, a Toronto statistician who seemingly cracked the scratch-lottery ticket code. ”The tic-tac-toe lottery was seriously flawed,” writes Lehrer. ”It took a few hours of studying his tickets and some statistical sleuthing, but he discovered a defect in the game: The visible numbers turned out to reveal essential information about the digits hidden under the latex coating. Nothing needed to be scratched off—the ticket could be cracked if you knew the secret code.” Srivastava took his findings to the Ontario Lottery and Gaming Corporation, and the game was quickly pulled from stores, but Lehrer wonders if Srivastava is the only person to have cracked a lottery: “Consider a series of reports by the Massachusetts state auditor. The reports describe a long list of troubling findings, such as the fact that one person cashed in 1,588 winning tickets between 2002 and 2004 for a grand total of $2.84 million. (The report does not provide the name of the lucky winner.) A 1999 audit found that another person cashed in 149 tickets worth $237,000, while the top 10 multiple-prize winners had won 842 times for a total of $1.8 million. Since only six out of every 100,000 tickets yield a prize between $1,000 and $5,000, the auditor dryly observed that these ‘fortunate’ players would have needed to buy ‘hundreds of thousands to millions of tickets.’” There’s a lot more to be said — a lot more that has been said, on this blog — about lotteries; and there’s also the no-lose lottery to consider. (HT: Johnny Tullner) (10)
… Jonathan Haidt, a social psychologist at the University of Virginia who studies the intuitive foundations of morality and ideology … polled his audience at the San Antonio Convention Center [during the annual meeting of the Society for Personality and Social Psychology], starting by asking how many considered themselves politically liberal. A sea of hands appeared, and Dr. Haidt estimated that liberals made up 80 percent of the 1,000 psychologists in the ballroom. When he asked for centrists and libertarians, he spotted fewer than three dozen hands. And then, when he asked for conservatives, he counted a grand total of three.
“This is a statistically impossible lack of diversity,” Dr. Haidt concluded, noting polls showing that 40 percent of Americans are conservative and 20 percent are liberal. In his speech and in an interview, Dr. Haidt argued that social psychologists are a “tribal-moral community” united by “sacred values” that hinder research and damage their credibility — and blind them to the hostile climate they’ve created for non-liberals.