The Logic of Life: The Rational Economics of an Irrational World (Hardcover)

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Editorial Reviews

Amazon.com Review

A Message to Amazon Readers from Author Tim Harford

Give yourself a pat on the back. You're not as stupid as everyone says you are, and now there's a book that proves it.

When I first conceived of The Logic of Life, my aim was to show that a world full of smart people--people like you, that is--doesn’t necessarily look logical on the surface. We eat too much and worry about being fat; drink too much and cringe when we remember; spend too much at Christmas and worry about the bills in New Year. And that’s just the small stuff: what about crime, racial segregation, divorce, big-money politics?

And yet underneath it all there is a hidden logic. It isn’t always pretty, but it’s there if you know how to see it. That is what The Logic of Life is all about.

But when I'd finished the first draft, my editor told me that he didn't think that people were as logical as I'd said. He wanted me to prove my point.

At first, I thought it was my editor thinks people are illogical because he works in the publishing business. Of course life looks illogical if you do that. (In fact, life looks crazy in most offices: see "Why Your Boss is Overpaid," chapter four.) But then I realised he was right. I'd left the most important step out.

So I went back and made sure that I laid out all the amazing evidence. I looked at single women hitting the dating scene in American cities; I looked at juvenile delinquents across the US; I looked at Mexican prostitutes; I looked at traders at a convention in Disney World; I looked at professional poker players in Las Vegas and professional soccer players in Europe. I looked at violent spouses, alcoholics, and school bullies.

In every case I discovered a story of hidden incentives and unexpected logic. And through the process of writing--and living--the book, I discovered that this crazy world of ours makes more sense than you might think.

---

From Publishers Weekly

Financial Times and Slate.com columnist Harford (The Undercover Economist) provides an entertaining and provocative look at the logic behind the seemingly irrational. Arguing that rational behavior is more widespread than most people expect, Harford uses economic principles to draw forth the rational elements of gambling, the teenage oral sex craze, crime and other supposedly illogical behaviors to illustrate his larger point. Utilizing John von Neumann and Thomas Schelling's conceptions of game theory, Harford applies their approach to a multitude of arenas, including marriage, the workplace and racism. Contrarily, he also shows that individual rational behavior doesn't always lead to socially desired outcomes. Harford concludes with how to apply this thinking on an even bigger scale, showing how rational behavior shapes cities, politics and the entire history of human civilization. Well-written with highly engaging stories and examples, this book will be of great interest to Freakonomics and Blink fans as well as anyone interested in the psychology of human behavior. (Feb.)
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Product Details

• Hardcover: 272 pages
• Publisher: Random House; 1 edition (January 15, 2008)
• Language: English
• ISBN-10: 1400066425
• ISBN-13: 978-1400066421
• Product Dimensions: 9.4 x 6.4 x 1.2 inches
• Shipping Weight: 1.1 pounds (View shipping rates and policies)
• Average Customer Review: 3.7 out of 5 stars  See all reviews (47 customer reviews)
• Amazon.com Sales Rank: #177,894 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

209 of 249 people found the following review helpful:

2.0 out of 5 stars pretty thin gruel, January 19, 2008

By	Gertude Whitman (New York, NY) - See all my reviews

"Logic" may be 270 pages, but it feels more like seventy. If you have the vaguest experience with behavioral economics -- e.g., from reading Dubner and Leavitt's "Freakonomics" columns in the New York Times -- a lot of the background will seem very familiar and a lot of the "gosh-wow" that Harford tries to generate will seem a little forced. Indeed, quite a few of Harford's central pieces have already appeared in the popular press -- e.g., the material on pacific islands and economic growth as a function of when they were colonized.

There is a real "factoid" quality to the book. The various chapters, on sexual behavior and AIDS, game theory and poker, racial discrimination, CEO pay, and the role of cities and legal systems (I think I got them all) seems strung together with no overriding theme beyond the kind of "gee-whiz" factor of applying economics to social issues. The weakest parts come near the end, where the summaries of research begin to be overwhelmed by anecdote and story. I was left without a clear idea, for example, why Harford considered it self-evident that cities would remain centers of the information economy.

Since "Freakonomics", the bar has been set a little higher for these kinds of books. Vague popularizations of other people's research studies are fine for a New York Times article or blog post, but really can't sustain a book. If you look -- as I do -- for the author to make some kind of larger point, you'll do so in vain; what larger points he does make are a bit evident (everyone behaving rationally can lead to horrible social consequences -- tragedy of the commons or the voter's paradox, anyone? These are hardly new discoveries!)

One interesting avenue to examine -- looking at the arguments of those who consider the field to be a bit overblown in its claims, or putting the field in a larger context -- goes mostly untouched. Discussion of Malthus is pretty bare, and what Harford marshals in response is really thin and poorly argued; in general, this really is another "random walk" through the literature.

I'm sure the book will sell well; it's a good airplane read (but it won't last you longer than a four-hour flight at most.) The market for these books is new and there are still plenty of people who will be amused and surprised to see what Harford has to report from the "field." But those looking for a more sustained performance, with deeper intellectual engagement with the fascinating issues that economics raises for the social and human sciences, will have to look elsewhere.

13 of 13 people found the following review helpful:

2.0 out of 5 stars At best a badly edited book, July 1, 2008

By	Yogesh Upadhyaya "CTC" - See all my reviews (REAL NAME)

I liked Tim Hartford's earlier work - The Undercover Economist very much. I have taken a few graduate courses in Economics and loved the way the book refreshed and even gave new concepts to me. Thus, I picked up The Logic of Life with a lot of expectations. These expectations were badly dashed.

My big problem with this book is that Hartford lacks rigor. In a popular book I wouldn't expect the rigor of an academic article, but when an author draws conclusions that are wider ranging than warranted or if the author factually incorrect then I do have a problem. There are at least a couple of instances when Hartford does that. For me it taints the whole book - making me ask questions such as what if Hartford is factually incorrect in other places that I don't know about.

Hartford relies a lot on the experiments of John List to set up his premise - People are more rational in their day to day life than psychologists give them credit for. One set of List's experiments demonstrated that experienced pin and baseball card collectors are able to make rational decisions in situations where rookies often make irrational ones. Hartford then extends this logic to claim that as people are experienced in their day to day life - in activities such as work and shopping - they are unlikely to make the rookie irrational mistakes. To me this is a big stretch. I don't know anyone who thinks a day-to-day shopping decision through as much as an experienced collector would. A little effort from the author here in establishing his premise would have been really well served.

Hartford really lets go of rigor when criticizing the work of Jeffery Sachs. Coincidentally, I was reading "The End of Poverty: Economic Possibilities for Our Time" by Jeffery Sachs at the same time I was reading Logic of Life and I was shocked by Hartford's presentation of Sachs' theories and also his refutations. For example, Hartford says that malaria is unlikely to be a cause of under-development as it kills only young children and not adults. Sachs has argued in reasonable detail how malaria can cause poverty (absenteeism, delay of investment projects, undereducated children and parents making decisions of having more children). I for one cannot understand how one line stating malaria kills children and hence does not effect economy from Hartford is anything but a lazy piece of writing. Hartford' writing on the topic gets almost bizarre when he then states "In any case, these diseases can be fought by countries with the resources to do so." As this statement is apparently to refute the logic of Sachs, it is mind boggling as Sachs to my mind is also saying the same thing. The disease can be fought - however, the really poor countries do not have the resources to do so. At best statements like these are very poor editing of the book. The point here is not if Sachs is correct or not. The point is that if you are refuting the theory of a person, the least you should be doing is to state it correctly and in full.

For me, if I start doubting one part of the book I start thinking - this author is not very incorrect about a part I know about, so can I trust him on other parts where I don't know too much? This does sharply reduce the enjoyment of what is a very readable book.

20 of 22 people found the following review helpful:

5.0 out of 5 stars A valuable reminder that economics is a means not an end, January 17, 2008

By	Andy Carlisle - See all my reviews

A lively and thought-provoking follow-up to Harford's debut book The Undercover Economist, which used textbook economics to throw new light on everyday life. In this second book Harford moves well beyond the textbook to take us on a tour of some cutting edge research and thinking that's emerging from what he calls a "new breed of economists". Among them is Steve Levitt, whose Freakonomics popularized the notion that economists can have interesting things to say about areas you wouldn't normally expect them to be poking their noses into - but Levitt is only one of many academic researchers who are cheerfully roaming over other people's turf from their economics labs, so Harford's book serves as a timely overview of a newly sexy subject.

The result is a startlingly diverse collection of insights and anecdotes which are all held together by one central premise - that you can explain a lot about life by starting from the simple assumption that people are fundamentally rational. This is not an uncontroversial assertion - among the "new breed of economists" are those melding economics with psychology into a fledgeling discipline of behavioral economics, which focuses on our irrational quirks. Harford's view is not to dismiss these human foibles, but to argue persuasively that they shouldn't be overstated, and that in most important situations we behave rationally - that is, subconsciously evaluating costs and benefits and responding to incentives - to a remarkable extent.

Harford's writing is a joy to read, especially when he's impishly puncturing pomposity - my favorite is the "why your boss is overpaid" chapter, which discusses several theories that could rationally explain the obscenely high wages commanded by modern CEOs (hint: none of them are "because they're worth it"). One great lesson made clear by this book is that individually rational decisions can lead to socially horrible outcomes, a conclusion never clearer than in the discomfiting chapter on "rational racism". It's a valuable reminder that economics is a means not an end - rational choice theory doesn't dictate what society should be like, rather it teaches how we can harness rationality by changing incentives to shape the society we want.