Why Levitt Is Wrong (About Book Tours, Not Oil)

Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven D. Levitt and Stephen J. Dubner - William Morrow, 2005

Levitt and I don't have all that many disagreements, at least not in public. But this one's a little close to home. It began with this post, in which I wondered aloud if the tour was worth the publisher's money. Steve followed recently with this post, which detailed why, from his perspective, the tour was a waste of his time. Well, in this case he's guilty of thinking like an economist. Generally it's not so bad to think like an economist -- in fact, it's served Levitt very very well over recent years. But when you look at the world through the eyes of a super-rational agent, you do tend to miss the scenery. Levitt acknowledges that he went on the tour because there were a variety of incentives at play -- social and moral as well as the more obvious financial incentive. But then when he calculates the ROI, he essentially ignores the social and moral returns. So yes, it's true that the financial return is probably (and I stress "probably," since it'll be a while before anyone can measure the long-term financial effect of this tour) pretty thin considering the time invested, but the returns in the social and moral realm are quite considerable. Levitt says he hates attention, and I know this to be (mostly) true. And yet, consider some of the non-financial benefits generated by the tour: a public platform from which to discuss our ideas; the likelihood that our ideas will be heard more in the future; the chance to see old friends from college; the chance to visit a few excellent bookstores, the Milken Institute, the Commonwealth Club, Yahoo! headquarters, and Google headquarters; the chance to ride around in the same black sedan that carried Jack Welch only a few weeks earlier, and hear some pretty entertaining Welch stories from the driver; the chance to participate more fully with bookstores and our publisher in this strangely successful publishing venture; and the chance to generally see more of the world and its inhabitants. (Along with, yes, as he acknowledged, the chance to be gone for a week and miss our families and other opportunities.) Now maybe it's true that none of those returns really matter to Steve (though I think at least the chance to see old friends probably does matter). Or maybe -- and this is probably the closest to the truth -- this is a case where Steve's incentives and mine are unaligned. For me, a writer, a high-profile book tour even as short as this one was a) mostly fun; b) mostly gratifying; and c) mostly productive. Did I miss my kids? Sure. Did I get any work done while I was gone? Not much. Still, the return seems well worth it to me. That's because a book tour is a pretty essential element in my profession. In Levitt's profession, however, it's not. If anything, this whole popularity thing may be bad for his career. Some academics get horribly cranky when a peer deigns to sprinkle the guild's wisdom upon the masses. So does a book tour make sense from his perspective? Maybe not. I guess the equivalent might be if the Quarterly Journal of Economics were to ask me to collaborate on an article about the economics of publishing; my response would be ... um ... "and I want to do this why?" All this said, I'm glad Steve allowed his arm to be twisted and came along on the tour. And if he tries to tell you again how miserable he was, asking him about the Pasadena laughing fit.
posted by Stephen J. Dubner at 8:24 AM



2 Comments:Ken Webb said...
I have a first run copy of the book. If I come up to chicago, can I track you guys down and have you sign my copy?

Look at it this way, you will not have to go on a book tour. :)

8/22/2005 9:42 AM
Peter Ostrovski said...
Great post. I think people miss the non-financial implications too often in calculating ROI. This is especially true of fledgling economists who have just learned the concept of opportunity cost. They begin calculating the opportunity cost of every activity they partake in strictly through monetary terms, while ignoring the social and moral benefits that said activity provides.

8/22/2005 10:31 AM