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What is behavioral economics? Why does it matter to you?

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Podcast Episodes

What is behavioral economics? Why does it matter to you?

190. The Voltage Effect with John List

Today I am very excited to introduce you to Dr. John List, former chief economist at Uber, current chief economist at Lyft, professor at the University of Chicago, co-author of the wildly popular book, The Why Axis: Hidden Motives and the Undiscovered Economics of Everyday Life, who is here talking about his newest book, which just came out a couple of days ago, titled The Voltage Effect: How to Make Good Ideas Great and Great Ideas Scale.

In this episode, we talk about ideas that can scale, possible hurdles you may face when scaling, and how to overcome those obstacles. John shares about his brand new book and the five vital signs to vett your own ideas as you are growing to determine if they will scale, and what to do for those that might not be ready to scale yet. Listen in to learn all about making those good ideas great and your great ideas scale!

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IN A RUSH?

HERE'S A 2 MINUTE TIP.

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SHOW NOTES:

  • [00:42] Today I am very excited to introduce you to Dr. John List. Former Chief Economist at Uber, current Chief Economist at Lyft, and professor at the University of Chicago. 
  • [02:38] John shares about himself and his background in behavioral economics. 
  • [03:18] He quit on his dream to be a professional golfer to pursue his new dream in economics. 
  • [05:29] After learning he would take the lessons in many cases from the classroom and use them in the real world.  
  • [07:19] He hasn’t been to all the baseball stadiums yet, but nearly all of them. 
  • [08:42] John shares the moment he started becoming more interested in scaling when he started a preschool and created his own curriculum.
  • [10:59] Turning a mountain into a molehill. 
  • [12:23] We very rarely say, “Are we doing something that is scalable?” and “What do we need to do differently in our original research if we find the program works to make it scale?” 
  • [14:12] A constant thread in all of his walks of life is that you can only make big changes at scale. 
  • [16:58] There are five important vital signs that any idea has to have a chance to scale. 
  • [17:49] Just because your idea doesn’t check all five boxes doesn’t mean you shouldn’t still go for it.  
  • [20:01] Vital Sign 1: Make sure your idea actually has voltage before you try to scale it. 
  • [21:14] Vital Sign 2: know your audience. 
  • [24:41] His group developed a new product called Uber Apologies. Apologies really only work for new users. 
  • [27:09] Vital Sign 3: Understand your situation.
  • [29:05] Look at all of the constraints and flaws at scale and bring that back to the original research. With those constraints in place, do we have an idea that can still work?
  • [30:18] Vital Sign 4: the spillover effect. 
  • [32:06] His team rolled out tipping at Uber in the summer of 2017. 
  • [34:35] Vital Sign 5: understand whether your idea has economies of scale or diseconomies of scale. Anything that has made it big has great economies of scale. 
  • [37:28] The context or the properties of the situation are super important. 
  • [38:02] Poke and prod and figure out where the weaknesses are. What are the nonnegotiables and if those aren’t available at scale then you have to change your idea and refine. 
  • [40:53] We have a finite number of days we get to live on this earth and we only have so many ways to change it and make it better. Why not give yourself your best shot?
  • [42:38] The second half of the book is using storytelling and standard ways to think economically to make better decisions in your life. 
  • [45:09] Melina shares her closing thoughts. 
  • [47:16] If you enjoy the experience I’ve provided here for you, will you share about it? That could mean leaving a rating/review or sharing the episode with a friend (or 10!)

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