What Happens When an Economist Walks Into a Brothel?
An economist asks prostitutes, gamblers, paparazzi, and big-wave surfers how they manage risk—with lessons for all of us.
The Sagebrush Ranch brothel in Mound House, Nevada.
Photographer: Steve Marcus/Reuters
To learn how to manage risks in your life, don’t consult office-bound economists or actuaries. Ask the real experts: prostitutes, gamblers, magicians, paparazzi, big-wave surfers, movie producers, horse breeders, and soldiers. Their careers require them to take risks. They succeed by doing so smartly—deriving as much benefit as possible per unit of risk taken. Allison Schrager, herself an economist, though not of the office-bound variety, interviewed all of these exotic professionals for an intriguing new book, An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.
Schrager, who earned her doctorate at Columbia University, is a journalist at Quartz and co-founder of the risk advisory firm Life Cycle Partners LLC. (Disclosure: I got to know her when she worked at Bloomberg Businessweek writing smart articles like this.)