#566: John List — A Master Economist on Strategic Quitting, How to Practice Theory of Mind, Learnings from Uber, Optimizations to Boost Donations, the Primitives of Decision-Making, and How Field Experiments Reveal Hidden Realities

John List — A Master Economist on Strategic Quitting, How
to Practice Theory of Mind, Learnings from Uber, Optimizations to
Boost Donations, the Primitives of Decision-Making, and How Field
Experiments Reveal Hidden Realities | Brought to you
by Athletic
Greens all-in-one nutritional
supplement, Four
Sigmatic mushroom
coffee, and Allform premium,
modular furniture. More on all three
below.


John A. List (@Econ_4_Everyone) is the
Kenneth C. Griffin Distinguished Service Professor in Economics
at the University of Chicago.


His research has led to collaborative work with several different
firms, including Lyft, Uber, United Airlines, Virgin Airlines,
Humana, Sears, Kmart, Facebook, Google, General Motors, Tinder,
Citadel, Walmart, and several nonprofits. For decades, his field
experimental research has focused on issues related to the inner
workings of markets; the effects of various incentives schemes on
market equilibria and allocations; how behavioral economics can
augment the standard economic model; early childhood education
and interventions; and, most recently, on the gender earnings gap
in the gig economy (using evidence from rideshare drivers). 


His research includes more than 200 peer-reviewed journal
articles and several published books, including the best seller
he coauthored with Uri Gneezy, The Why Axis: Hidden Motives
and the Undiscovered Economics of Everyday Life, and his new
book, The Voltage Effect: How to Make Good Ideas
Great and Great Ideas Scale.


List was elected a member of the American Academy of Arts and
Sciences in 2011 and a fellow of the Econometric Society in 2015.
He received the 2010 Kenneth Galbraith Award, the 2008 Arrow
Prize for Senior Economists for his research in behavioral
economics in the field, and was the 2012 Yrjö Jahnsson Lecture
Prize recipient. He is a current editor of the Journal of
Political Economy.


Please enjoy!


This episode is brought to you
by Four Sigmatic and their
delicious mushroom coffee, featuring lion’s mane and
chaga. It tastes like coffee, but it has less than
half the caffeine of what you would find in a regular cup of
coffee. I do not get any jitters, acid reflux, or any type of
stomach burn. It’s organic and keto friendly, plus every single
batch is third-party lab tested.


You can try it right now by going
to FourSigmatic.com/Tim and using the
code TIM. You will receive up
to 44% off on the lion’s mane coffee
bundle. Simply
visit FourSigmatic.com/Tim. If you are
in the experimental mindset, I do not think you’ll be
disappointed. 


*


This episode is also brought to you
by Allform! If
you’ve been listening to the podcast for a while, you’ve probably
heard me talk about Helix Sleep mattresses, which I’ve been using
since 2017. They’ve launched a new company
called Allform, and they’re
making premium, customizable sofas and chairs
shipped right to your door—at a fraction of the cost of
traditional stores. You can pick your fabric (and
they’re all spill, stain, and scratch resistant), the sofa color,
the color of the legs, and the sofa size and shape to make sure
it’s perfect for you and your home.


Allform arrives in just 3–7 days, and you
can assemble it yourself in a few minutes—no tools
needed. To find your perfect
sofa, check out
Allform.com/Tim. Allform is offering 20% off all
orders to you, my dear listeners,
at Allform.com/Tim.


*


This episode is also brought to you
by Athletic
Greens. I get asked all the time,
“If you could only use one supplement, what would it be?” My
answer is usually AG1 by Athletic Greens, my
all-in-one nutritional insurance. I recommended it in The
4-Hour Body in 2010 and did not get paid to do so. I do my
best with nutrient-dense meals, of course,
but AG further covers my bases with vitamins, minerals,
and whole-food-sourced micronutrients that support gut health and
the immune system. 


Right now, Athletic
Greens is offering you their Vitamin D
Liquid Formula free with your first subscription
purchase—a vital nutrient for a strong immune system and
strong
bones. Visit AthleticGreens.com/Tim to
claim this special offer today and receive the free Vitamin D
Liquid Formula (and five free travel packs) with your first
subscription purchase! That’s up to a one-year
supply of Vitamin D as added value when you try their delicious
and comprehensive all-in-one daily greens product.


*


What is a clawback incentive, and how has John found it useful as
a father of eight children? What other incentives have proven to
be effective social tools in the real world? [07:44]


The side effects of modifying or removing incentives, how
incentive durability is measured, and why getting human beings to
take on short-term inconveniences for long-term but far-off
rewards can be troublesome. [15:23]


John details his extensive work researching the science of
charitable giving and tipping (particularly with ridesharing) and
what he’s discovered over time. [22:33]


Why the ability to publish his work in academic journals was the
deciding factor in John’s acceptance of a job at Uber over
Amazon, and what research had to say about the efficacy of
tipping ranges in user interfaces. [35:07]


What data says about customer service and the power of apologies,
and the consequences of allowing such data to be published in
academic journals instead of hidden away in some proprietary
lockbox. [44:04]


What John learned about human nature by measuring social
preferences and reputation effects in actual transactions as an
economist — and during his time as a baseball card dealer.
[51:52]


John’s thoughts on critical thinking hierarchy, theory of mind,
and what the bar scene in A Beautiful Mind got wrong about the
Nash equilibrium. [57:54]


How does someone develop theory of mind as an applicable skill?
[1:03:09]


How John came to win a poker tournament in Australia while
killing time before a conference. [1:07:34]


What prompted John to write The Voltage Effect: How to Make Good
Ideas Great and Great Ideas Scale? [1:10:26]


John addresses the replication and credibility crises in science,
and their real-world consequences. [1:15:38]


“Scaling is not a silver bullet problem. Rather, it is an Anna
Karenina problem.” How to check the vital signs that determine if
an idea is scalable, with Jonas Salk’s success in conquering
polio by way of vaccination serving as an example. [1:19:36]


Untended side effects of failing to understand spillovers while
scaling — like when the introduction of tipping to the
ridesharing dynamic presents drivers with a new set of problems,
or when drivers exploit technical loopholes to ditch
responsibility for rudely cancelling a customer’s pickup from
afar. [1:28:09]


Why did John have such a slow start entering the job market after
getting his PhD? What was holding him back? [1:36:34]


Is there any application for fractal mathematics to economics?
[1:41:26]


Scalable incentives, marginal thinking, optimal quitting, and
building culture. [1:45:46]


Why is StubHub one of John’s favorite apps? [2:07:46]


Thoughts on blockchain as a rich source of data for behavioral
economists. [2:09:10]


How should a modern, uninitiated audience approach Adam Smith’s
The Wealth of Nations? [2:12:05]


Parting thoughts. [2:16:30]


*


For show notes and past guests, please
visit tim.blog/podcast.


For deals from sponsors of The Tim
Ferriss Show, please visit
tim.blog/podcast-sponsors.


Sign up for Tim’s email newsletter (“5-Bullet Friday”)
at tim.blog/friday.


For transcripts of episodes, go
to tim.blog/transcripts.


Discover Tim’s
books: tim.blog/books.


Follow Tim:


Twitter: twitter.com/tferriss 


Instagram: instagram.com/timferriss


Facebook: facebook.com/timferriss 


YouTube: youtube.com/timferriss


Past guests on The Tim Ferriss
Show include Jerry Seinfeld, Hugh
Jackman, Dr. Jane Goodall, LeBron James, Kevin
Hart, Doris Kearns Goodwin, Jamie Foxx, Matthew
McConaughey, Esther Perel, Elizabeth
Gilbert, Terry Crews, Sia, Yuval Noah
Harari, Malcolm Gladwell, Madeleine
Albright, Cheryl Strayed, Jim Collins, Mary
Karr, Maria Popova, Sam Harris, Michael
Phelps, Bob Iger, Edward Norton, Arnold
Schwarzenegger, Neil Strauss, Ken Burns, Maria
Sharapova, Marc Andreessen, Neil Gaiman, Neil de
Grasse Tyson, Jocko Willink, Daniel Ek, Kelly
Slater, Dr. Peter Attia, Seth Godin, Howard
Marks, Dr. Brené Brown, Eric Schmidt, Michael
Lewis, Joe Gebbia, Michael Pollan, Dr. Jordan
Peterson, Vince Vaughn, Brian Koppelman, Ramit
Sethi, Dax Shepard, Tony Robbins, Jim
Dethmer, Dan Harris, Ray Dalio, Naval
Ravikant, Vitalik Buterin, Elizabeth
Lesser, Amanda Palmer, Katie Haun, Sir Richard
Branson, Chuck Palahniuk, Arianna Huffington, Reid
Hoffman, Bill Burr, Whitney Cummings, Rick
Rubin, Dr. Vivek Murthy, Darren Aronofsky, Balaji
Srinivasan, Sarah Silverman, Dr. Andrew
Huberman, Dr. Michio Kaku, and many more.


See Privacy Policy at https://art19.com/privacy and California
Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.