Economist Allison Schrager thinks a lot about risk. She is the co-founder of LifeCycle Finance Partners, and views everything though that lens. It colors the topics she researches and writes about. Even – or perhaps especially – when researching people working in unusual industries. Big wave riders, poker players, paparazzi, horse breeders all fall under lens.
Her research led her to analyze a dataset of 1.2 million transactions for the online prostitution industry. The result of that was a column about the economics of sex workers, and how they manage the risks associated with their trade. That discussion led her to the Bunny Ranch in Nevada, to further study sex pricing. There, she learned about a variety of interesting and unexpected economic issues.
In our Masters in Business conversation, Schrager explains how this experience resulted in the book “An Economist Walks into a Brothel: And Other Unexpected Places to Understand Risk.” Her work analyzes the world through a lens of risk-management. Schrager tells how she learned that the Bunny Ranch has a negotiation training program, because the employees must negotiate the price of each transaction with customers. And, many do not know the true market value of the work they perform.
Her favorite books are here; A transcript of our conversation is posted here.
You can stream/download the full conversation, including the podcast extras on Apple iTunes, Bloomberg, Spotify, Google Podcasts, Overcast, Castbox, and Stitcher. All of our earlier podcasts on your favorite hosts can be found here.
Next week, we speak with Nathan Sheets, head of Global Macroeconomic Research at PGIM Fixed Income.