The Why Axis: Hidden Motives and the Undiscovered Economics of Everyday Life

Great short book, easy to read and accessible. Thus will make you ponder large problems and small, strategic and operational. You will be offered lots of ideas and encouraged to give it a go - carry out your own experiments!

Interesting book but having read Daniel Kahneman's Thinking Fast and Slow, I'm not sure I learned much.

What I like to this book is the way the 2 authors try to apply as much as possible the "out-of-lab" or field experiments to real world. It is very interesting that some thoughts and theories and hypothesis seem to describe so elegantly the reality until the reality itself proves otherwise. One example: theory says that children should not be motivated with money in order to learn because if we do this then they will make learning linked to an external motivation while we should strive for their internal motivation on learning. But guess what?! For some children it does work! "Bribing" them with money or gifts can actually make them to want to learn more.

This book sounded interesting and I wanted to love it. But it's only good, not great. There is a lot of good things to say - it's based on years of empirical research, the topics vary and range from discrimination to helping Chinese factories. Everything is clearly explained, but I think that as the authors discovered the book would be too short, they added a lot of unnecessary narrative nonsense. They explain experimental designs on one page and then spend 5 pages describing hunting down participants in excruciating detail. They don't really spend much time explaining experimental designs, caveats, biases etc., just the outcomes, policy recommendations and some feedback. It's a really short book on interesting topics in experimental economics from people who actually did those experiments. Fun, but not great, especially if you're an economist. Would recommend as light summer reading for non-economists.

Amazing

Review courtesy of www.subtleillumination.com Paying students for marks gives them an incentive to study. Does it also crowd out intrinsic incentives for the same, crippling students by making them unable to study when they are not immediately paid for it? If a gay couple tries to buy a car, does the dealership discriminate against them because they are inherently hostile to gays, or because they believe they can increase their profits by doing so? Should charities allow people to opt out of receiving mailings, and if so, will that increase or decrease donations? If you are a teachers’ union, activist, or charity, you likely have strong opinions on the answer. What you may not have is any actual knowledge. Gneezy and List, two great experimental economists, argue that fundamental questions such as the best ways to educate, fight discrimination, and run businesses lie at the heart of experimentation. To understand discrimination, they tried having gay couples purchase cars while signalling they planned to check other dealerships, and found that discrimination disappeared; to understand charitable giving, they experiment with several different approaches, finding that having a pretty girl ask for donations and offering a lottery prize for donating are equally effective in increasing donations, but that the lottery has long term effects while the pretty girl does not. Giving people the opportunity to opt out of mailings is most effective of all, however, increasing initial donations, leaving long-term donations unchanged, and saving money on mailings. The Why Axis is another in a stream of books by economists popularizing their work. As with many such, it is reasonably well written, and stocked full of anecdotes, stories, and examples. In addition, Gneezy and List argue passionately for a more experimental way of looking at the world. Whether we are considering a new job, a new product, or a new policy, trying it out on a small scale provides information essential to avoiding blunders. In that spirit, pick up a paper or two of theirs to see if you find them interesting, and if so, the book might well be worth it.

Interesting but repetitive. After the first time we are told to go out and experiment, the story has pretty much been told. The examples given are useful but the book does feel like it runs out of steam about half way through. It was worth reading but much more could have been made of the book.

Me he leído este libro guiado por su descripción y las reseñas en amazon.com. Gneezy y List son dos economistas experimentales que han publicado en las mejores revistas académicas en Economía (Econometrica, American Economic Reviel, Quarterly Journal of Economics o The Jounal of Political Economy entre otras) con los resultados de sus experimentos en la donación a causas benéficas o en la educación. De su trabajo se puede concluir que la experimentación es un campo prometedor para diseñar nuevas políticas, para lograr fines sociales o para mejorar los beneficios de las empresas. Los experimentos controlados permiten comparar los resultados de un grupo de control (al que se le aplican las medidas habituales) con los logrados en otros grupos a los que se les pone ante políticas distintas. Por ejemplo, se logra recaudar más fondos para una causa benéfica enviando una carta solicitando una donación o es mejor hacer campañas con la promesa (que hay que cumplir) de que por cada euro donado una entidad entregará un euro adicional. Si es así, ¿cuál es la recaudación adicional lograda con esta medida? Los autores proponen no dejarse llevar por las ideas a preconcebidas y experimentar cuando no haya evidencia que las sustente. También parece deducirse que los motivos por los que las personas hacemos las cosas son muchas veces poco evidentes y la experimentación permite descubrirlos a al menos confirmar o rechazar nuestras hipótesis. En el ámbito empresarial, y en mi opinión, la tesis de este libro podría suponer un cambio en los fundamentos de la investigación de mercados. Es posible ir más de los estudios cualitativos y cuantitativos y proponer experimentos con distintas configuraciones de un producto o servicio o con distintas líneas de comunicación, por ejemplo. La estadística y el diseño de cuestionarios seguirán siendo útiles, pero quizás sea bueno dejar de esconderse tras las pantallas y salir a las calles. ¿Y por qué cuatro estrellas? Por una parte he echado de menos un tono más académico (soy economista después de todo) y menos divulgativo, y por otra los autores no han explicado en qué situaciones la experimentación es oportuna y en cuales no, es decir cuáles son sus límites. En cualquier caso recomiendo vivamente su lectura.

If you liked "Freakonomics" and its sequel, you will love this book. Behavioral economics is a fascinating field, and the authors here break down their findings in a very readable, accessible way. Their field experiments are creative and even grandiose, and the results can be very surprising. I particularly liked the way they approached the problem of women's inequality in the workplace and explored potential ways of improving educational outcomes. Their discoveries about incentives and how they can work for or against the organization that is trying to implement them make for a very entertaining and educational read. I wish more people in public policy thought the way the authors do. Gneezy and List present some very precise, data-backed ideas for addressing social problems, and in an era of government budget-cutting, we need that kind of approach. Ideals are all well and good, but the data tell the story, and the authors present quite a convincing case for their way of thinking.

John List is surely a candidate for the Nobel Prize, and this is a very fine, accessible summary of his work with Uri Gneezy. List did field experiments before they became cool, and some of the results (particularly in a tour de force study on paying kids to study with future Clark medalist Roland Fryer) are stunning. The book is also a model of simple, no-frills writing that is rather uncommon in academia. Outside Daniel Kahneman's seminal "Thinking, Fast and Slow", this is one of the best popular economics books in years, better than Levitt-Duber, better than Landsburg, better than Harford. Read it.

This is a fantastic book that any left of field thinker has to have in their library. It challenges many aspects of the world we live in and the things that drive us.

*A full executive summary of this book is available at newbooksinbrief dot com. The main argument: Until quite recently, the field of economics was dominated mainly by theory-making. Specifically, economists applied their intellects to the human world, and developed abstract models to explain (and predict) the unfolding of economic events. At the heart of all this theory-making stood homo economicus—a narrowly self-interested individual who responded to incentives and disincentives in a perfectly rational way. In the past half century, though, various economists have added new wrinkles to the field’s repertoire. To begin with, pioneering economists such as Amos Tversky and Daniel Kahneman introduced controlled lab experiments (among other things) into the fold. And these experiments succeeded in adding nuance to our understanding of economic-man (he’s not quite as one dimensional and rational as he was once taken to be), as well as texture and complexity to our understanding of economic phenomenon. More recently, economists such as Uri Gneezy and John A. List have stepped in and showed that controlled field experiments also have a place in economics. For Gneezy and List, the world is their laboratory: the two go about slyly manipulating the natural environment in a controlled way (often fiddling with incentives and disincentives of all types) to see how we humans respond to the tweaks. Gneezy and List have been practicing this approach for upwards of 20 years now, and in this time they have helped shed light on everything from how to decrease crime rates; to how to improve school success; to how to encourage more charitable giving; to how to promote healthy living and decrease obesity; to how to set prices on products (so as to maximize profits); to how to understand (and limit) discrimination (to name but a few lines of research of theirs). And in their new book The Why Axis: Hidden Motives and the Undiscovered Economics of Everyday Life the two catch us up on their experiments and their results (while also touching on the experiments of other like-minded practitioners). Take education, to begin with. Gneezy and List have gained a fair bit of attention recently for showing how monetary incentives can be used to help improve grades and graduation rates (particularly with at-risk students)—and even curb school violence; and here we are apprized of the ins and outs of the experiments that were used in this research. What is less well-known is that the authors have also recently become involved in a massive longitudinal study that is designed to test the effectiveness of different approaches to pre-kindergarten education. Though still in its infancy, the study has already yielded some very interesting results; and given that the researchers intend to follow their experimental subjects throughout their lives, the study should help shed a great deal of light on just what approach to early childhood education is most effective. When it comes to charitable giving, Gneezy and List’s experiments have worked wonders in showing just how to encourage as much charity as possible—and have challenged many of the industry’s long-held beliefs in the process. The authors cover everything from how much seed-money is needed for a project to maximize donations; to how to approach follow-up requests made to established donors; to how to leverage raffles, lotteries and tontines for best success. On the topic of business, Gneezy and List remind us how a failure to use an experimental approach can lead to business disaster (as illustrated by Netflix’ 2011 decision to modify its business model without experimental research—a decision that drove hordes of customers away, sent the company’s stock plummeting, and nearly sank the business outright). The lesson: business tweaks (including changes in pricing) should be tested in a controlled way in a small market (say a given city) before being adopted across the board (an approach that has been utilized to great effect by such companies as Intuit and Humana). When it comes to discrimination, Gneezy and List have been able to use their experiments to reveal that much of the discrimination that happens nowadays is motivated less by hatred (or animus) as it is by plain old self-interest. Though perhaps not as threatening as outright hatred, discrimination practiced out of self-interest (known as economic discrimination) is problematic in its own right, and Gneezy and List also explore what strategies are best to curb it (this work is more important now than ever, as the internet [combined with data-driven analysis] has made economic discrimination very easy to practice--and hide). The book is a very fun and interesting read, and Gneezy and List clearly have a knack for telling about their research in a highly entertaining way. The only issue I had with the book is that the authors occasionally exaggerate and over-state just what we can conclude from their experiments. Still, there is much of interest to be learned here, and the book is well-worth the read (just make sure you take it with a grain of salt). A full executive summary of the book is available at newbooksinbrief dot com; a podcast discussion of the book will be available soon.