Tess Vigeland: It is Freakonomics time. Every two weeks, we're talking with Stephen Dubner, co-author of the books, the blog and as of this summer, a public radio show. How is your summer going, Stephen?
Stephen Dubner: It's all right, Tess, but I'm a Yankees fan and I'm getting a little impatient waiting for your Red Sox to start their annual collapse. But otherwise, things are pretty good.
Vigeland: Well my friend, you're going to have to keep waiting, because they already had their collapse in April, they are done and over with.
Dubner: We'll see about that. But honestly, I'll tell you: instead of keeping track of wins and losses -- which I usually do -- this summer, I've been thinking about something a little bit different, which is who ought to be quitting.
Vigeland: Uh, Jorge Posada?
Dubner: Ooh, that's a low blow -- that's deserved actually. Here's my thinking: you watch these guys, Adrian Gonzalez and Joey Votto and Justin Verlander and you marvel at their baseball skills. But for every guy like that, there are hundreds of younger players. But the numbers say that most of them are never going to get their chance. Out of all the American players drafted, only 11 percent will even make it to the majors.
Vigeland: Yeah, but if you're in that 11 percent, you're set for life, aren't you? At least financially?
Dubner: Here's the problem: we human beings are pretty good at deluding ourselves about the chances that something good will happen to us. And too often, that translates into making a bad decision about when to quit something. Not just baseball, but anything. It all boils down to two pretty simple economic concepts: one is sunk cost, and the other is opportunity cost.
Vigeland: OK, well let's talk about those. Sunk costs, the time or money that you've put into something that makes it really hard to quit. Opportunity costs, this is the idea that every hour or dollar that you spend on one thing, you're giving up the opportunity to spend that hour or dollar on something else.
Dubner: Exactly right. So here's Justin Humphries, he's a ballplayer that the Houston Astros drafted back in 2001. He was a very promising prospect, a big power-hitting catcher and first baseman. But after a few years in the minors, and after some injuries, Humphries wound up playing in an independent league, which is a team that wasn't even affiliated with a major league club.
Justin Humphries: Well when you're 25, making less than $2,000 a month, at some point you tell yourself, I can't do this to myself, I can't do this to my parents, and I can't continue when I know there's untapped potential to do other things.
Vigeland: Wow, so talking real opportunity costs there -- he had to weigh the cost of giving up on his dream against the actual financial cost.
Dubner: Exactly. And he did the fairly rare thing, which is he quit fairly young, went back to school. His sociology professor at Columbia was Sudhir Venkatesh. So the two of them, Venkatesh and Humphries, they teamed up to track the long term outcome of every player drafted by major league baseball teams in 2001, which is the year that Humphries was drafted. Here's Venkatesh explaining what they found out.
Sudhir Venkatesh: If you take two people who grew up in the same circumstances -- let's say one played baseball and one didn't -- the person who plays baseball is making about 40 percent less on average 10 years after they enter the game than the person who decides not to play baseball and who just wanted a regular career.
Vigeland: Forty percent less? That's crazy!
Dubner: It is crazy. That's what you give up by pursuing the dream that doesn't work out.
Vigeland: Well so then, if there's this proof that a career in pro baseball could be a really bad economic decision, why don't more players quit?
Dubner: Well, you know the saying right? 'A winner never quits, and a quitter never wins.' So as a society, we see quitting as failure. But I'd like to challenge that a little bit. Sunk costs are just that -- they're sunk. So instead of dwelling on them, you should forget about them. And this goes way beyond baseball; in fact, quitting, it turns out, can be good for your health. Here's Carsten Rausch, he's a professor of psychology at Concordia University in Montreal, and he has studied what happens to people when they quit what he calls "unattainable goals."
Carsten Rausch: People who are better able to let go when they experience unattainable goals, they have, for example, less depressive symptoms, and they have lower levels of systemic inflammation. And they develop fewer physical health problems over time.
So the problem here, Tess, is that neither Carsten Rausch nor I nor you can tell anyone else when their goal is, as he puts it, unattainable. What I can say, with some confidence, is that we should consider the upside of quitting, or strategic quitting, as I like to call it. So Tess, what do you say, anything I can interest you in quitting today?
Vigeland: Well I have to say, based on perhaps the example of Sarah Palin, sometimes it does pay to quit, right?
Dubner: Quitting upward?
Vigeland: Exactly. But I suppose in terms of me, let's see, in terms of sunk costs, I would like to give up on teaching my dog how to lie down, but way too much invested at this point, so we will persevere.
Dubner: Nah, live with the lazy dog. It's OK. Just don't quit the show, OK? Just don't quit the show.
Vigeland: Absolutely not. Never. Stephen Dubner, our Freakonomics correspondent. There is more of his work at FreakonomicsRadio.com. Thanks so much, it's been fun.
Dubner: Good to talk to you, Tess.