Friday, June 18, 2010

Is there a correlation?

Don't know if this is the effect of reading "Freakonomics: A Rogue Economist Explores the Hidden Side of Everything". It is a 2005 non-fiction book by University of Chicago economist Steven Levitt and New York Times journalist Stephen J. Dubner.

Scene out of the world

Case 1 - I have noticed this general scenario in India which includes me as well - Save more, Spend less - Save more for a happy future even if it means being Frugal now. The quote 'Save for a Rainy Day' is so commonly used in most of the households.

Case 2 - I have noticed many friends & other people (am guilty as well) - while eating a good meal we keep our favorite dish say fried chicken or a sweet dish for eating it at the end of the meal, we finish all the relatively ordinary dishes and then leisurely eat the relatively superior or tastier or favored dish.

Are case 1 & case 2 related? Do they have any vague correlation?

If I were to become the rogue economist and get into the shoes of Levitt or Dubner, I would say the following.

Analysis of Case 1 - yes the mindset in few countries are heavily biased over saving and not spending, it means you forgo certain pleasures of life at the peak of your health & early age and keep saving up for the future when you might not be able to utilize it to the maximum possible fun & happiness.

Analysis of Case 2 - yes the mindset in few countries are heavily biased over saving your best assets and not wasting / spending / using it rashly (or fast) [almost works on a principle of conservative rationing], it means you forgo tasting the best dish when you were really hungry (& could eat more) and keeping it for later times thinking you can enjoy it leisurely but the reality is by then your stomach is quite full and you end up just stuffing yourself and not relishing it.

Now do you get the correlation? There is a strong invisible mindset within most of us which influences most of our actions. Conclusion: The two cases have been proved to have a link.

"I always feel sorry for people who think more about a rainy day ahead than sunshine today." - Rae Foley



Anonymous said...

Hmm.. nice little thoughts. I see it differently though -
So, in case 1, you save for a rainy day and you argue that you may not be able to utilize it to the maximum possible fun & happiness when you are at the peak of your health. I think when you save for a rainy day, you want to use it when it rains i.e. when you are not healthy, not the same earning power, more needy..and so on.

In case 2, you save the best dishes towards the end of the meal. I think you do that, because you want that taste to linger in your mouth even after you finish the meal. Recent memories last longer!

Do you still see a correlation? To an extent - yes.

-Your Friendly Anon ;)

Pravin Menon said...

Good POV - Sounds rational albeit a bit rebellious. We know where America's capitalism and consumerism has taken it and seemingly-socialist India has always played safe. In such situations, take the best of both worlds (but aren't we all saving for a wonderful post-retirement life (especially an early retirement)?)