On the Trail of Economic Oddities
A curious individual, Robert Frank, the Henrietta Johnson Louis Professor of Management at Cornell University's Johnson Graduate School of Management, is never shy about asking, "Why?" And he forces students to wonder aloud, too.
Driven by a desire to tell stories people won't soon forget, Frank has students—from freshmen to PhD candidates—ask questions and find answers in what he calls the "economic-naturalist" assignment. Students have to write an essay explaining everyday occurrences and oddities in economic terms. They have churned out papers on everything from why hotel mini-bar prices are so exorbitant to why drive-up ATMs have Braille dots on their keys.
Invigorated by his students' work, Frank picked the best of the thousands of essays his students have turned in over the years and combine those with his own examples to create The Economic Naturalist: In Search of Explanations for Everyday Enigmas (Basic Books, 2007). Frank says the book probably will help people retain basic economic principles better than an introductory course.
Frank, who is also a monthly columnist for The New York Times, says half of the royalties from this edition of the book will go to Cornell's writing program, the inspiration for the assignment. And he hopes to encourage other professors to offer similar assignments because he thinks it's one of the most effective ways to teach just about anything, not just economics. Plus, says Frank, the explanations make for great conversation at cocktail parties.
Frank recently spoke with BusinessWeek.com reporter Francesca Di Meglio. Here are edited excerpts of their discussion:
What's so exciting about economics?What's exciting about the subject is that there are really only four or five or six—it depends on how you count—basic ideas. And once you master them, you can understand a whole host of things that you encounter in the world.
It's like biology in that sense. Once you master a few principles in evolutionary biology, there's suddenly all this texture and pattern that seems sensible and interesting, even though you never noticed it before. It's the same with basic ideas in economics.
Why should people learn the basics of economics?Economics is all about how you make the most of your opportunities. It's always a question of trying to figure out how to achieve a decent balance between competing aims that you hold. If you understand economic principles, you're going to end up getting much more out of your possibilities than you could if you didn't understand them.
How do you think professors can make economics more accessible?The key is to embed the ideas in simple narratives that have a story line that makes sense. We didn't really evolve doing equations and graphs. That came very late in our history as a species. For most of our evolutionary history, the way things got transmitted from one person to another was through stories. We were storytellers by inclination.
If you can wrap a story around an idea, it seems to slide into the brain without any effort. If you translate the idea into equations and graphs, you can still get into the average student's brain, but it just takes a lot more work, and they seem to lose all appreciation of the charm of the idea. Then they don't talk about the idea with one another, which is one of the main ways ideas get reinforced in your mind.
What do you hope readers take away from the book?If you're really willing to let yourself get absorbed in this book, you're going to learn more economics than students typically will from taking several courses in the subject. My real hope is that most of the people who read it will become economic naturalists.
Did you have a favorite enigma for which you were most happy to get an explanation?
The chapter at the end has lots of really good enigmas. One of my favorites is the one about why predominantly male legislatures typically vote to make polygamy illegal if polygamy is such a great deal for men. [According to Frank's book, the logic of supply and demand shows that monogamous men, who would have fewer women from which to choose if polygamy went mainstream, would be the actual victims of such a law.]
Are there other enigmas you hope to investigate or hope your students will investigate?Sure. A student just asked, "Why do they sterilize the needle and swab a prisoner's arm with alcohol before administering a lethal injection?" Obviously, you're not worried about infection from the needle because the prisoner is going to be dead in 10 minutes. So, why do they do that?
There are a lot of examples like this one, where it doesn't sound like there's a straightforward cost-benefit rationale for the behavior. There's some very interesting work being done now about the economics of personal identity. What does it mean to have a coherent identity as a person? It often leads you to behave in ways that aren't readily explainable by short-term costs and benefits.
What's the audience for this book?Everybody wants to write a best-seller, so it's pitched to any person who's intelligent and curious about the human condition. It's great to write a book where most of the ideas came from other people. I can brag about it without sounding like a jerk. The book really is interesting because it's the best ideas of thousands of really smart people.
What kind of reaction do you get from your students?They like the assignment. There's a learning curve for it. They have a lot of trouble—many of them—the first time. They have to do two of these papers. When the first one is due around midterm, I get a lot of anxious students coming to me asking, "Is this idea O.K.?" or "What about this question? Is it interesting enough?"
When it comes time for the second paper, typically they will want to know if they can do a medley, because they have more than one great idea. You can really tell that their brains have gotten rewired during the course of the semester. They're suddenly able to make sense of a lot of things that they never even noticed before. They seem to have fun doing it.
Do you think you will do another book of these assignments?I already have a growing file of interesting new examples. One student recently asked, "Why does the Japanese language have very few swear words and Korean is chock full of swear words?" Whatever the answer is, it's a great question.
Keypads and wedding gowns: It's all economics
The following student essay questions and answers were written for an assignment in Cornell professor of economics Robert Frank's class.
Why do keypad buttons on drive-up cash machines have Braille dots?
ATM producers have to make keypads with Braille dots for their walk-up machines anyway, so it is cheaper to make all machines the same way. The alternative would be to hold two separate inventories and make sure each machine went to the right destination. If the Braille dots caused trouble for sighted users, the extra expense might be justified. But they do not.
Why do brides spend so much money on wedding dresses they will never wear again while grooms rent cheap tuxedos even though they will have future occasions that call for one?
Most brides want to make a fashion statement, so rental companies would have to carry perhaps 40 or 50 distinctive dresses in each size. Because each garment would be rented only infrequently, the company would have to charge more than the garment's purchase price just to cover its costs. But because grooms are willing to settle for a standard style, a rental inventory of only two or three tuxedos in each size is sufficient, enabling companies to charge only a fraction of the suit's purchase price.
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