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The Five Life Decisions

How Economic Principles and 18 Million Millennials Can Guide Your Thinking

Choices matter. And in your teens and twenties, some of the biggest life decisions come about when you feel the least prepared to tackle them.

Economist Robert T. Michael won’t tell you what to choose. Instead, he’ll show you how to make smarter choices. Michael focuses on five critical decisions we all face about college, career, partners, health, and parenting. He uses these to demonstrate how the science of scarcity and choice—concepts used to guide major business decisions and shape national legislation—can offer a solid foundation for our own lives. Employing comparative advantage can have a big payoff when picking a job. Knowing how to work the marketplace can minimize uncertainty when choosing a partner. And understanding externalities—the ripple of results from our actions—can clarify the if and when of having children.

Michael also brings in data from the National Longitudinal Survey of Youth, a scientific sample of 18 million millennials in the United States that tracks more than a decade of young adult choices and consequences. As the survey’s longtime principal investigator and project director, Michael shows that the aggregate decisions can help us understand what might lie ahead along many possible paths—offering readers insights about how their own choices may turn out.

There’s no singular formula for always making the right choice. But the adaptable framework and rich data at the heart of The Five Life Decisions will help you feel confident in whatever you decide.

Read chapter one.

232 pages | 22 tables | 6 x 9 | © 2016

Economics and Business: Economics--General Theory and Principles, Health Economics


“At what point do you become an adult? As a culture we’ve laid out milestones: graduating from formal education, moving in with a significant other or perhaps bringing new life into the world. Next question, how do we make the right choice when confronted with so many options? As children we relied on parents to be our compass, but as adults the responsibility rests within. Professor Robert T. Michael of the University of Chicago set out to answer some of these questions in his book, The Five Life Decisions.”


“Michael pairs basic economic concepts such as opportunity cost with data on Millennials from the National Longitudinal Survey of Youth (NLSY) to walk the reader through the trade-offs inherent in life decisions in five areas: schooling, work, marriage, parenting, and health. While there are several nice things about this book, its use of NLSY to show the importance of sound economic decision-making, even when an individual is given a bad start in life, is an important point to raise in a book aimed at helping individuals succeed.”


“Provides guidance on how to think about five big life decisions that young adults make regarding education, occupations, relationships, parenting, and health, and considers how economic tools can help them to make wise choices.”

Journal of Economic Literature

“What do you get when you cross an esteemed economics scholar with the trials and tribulations of everyday life? The answer: this guide, by the University of Chicago’s Robert Michael. The Five Life Decisions offers a handy introduction to powerful economic concepts by applying them to the pragmatic, real-world choices that young people have to make.”

Beth Kobliner, author of Get a Financial Life: Personal Finance in Your Twenties and Thirties

"Bob Michael, who has spent his distinguished career gathering and interpreting data, cogently uses decades of research to add light to our really important choices in life.  In the process, he reminds us that economics is not just about graphs and fancy math. It is about understanding human behavior and helping us to live better."

Charles Wheelan, author of Naked Economics: Undressing the Dismal Science

“This is a fantastic book that every young person should read. Michael equips us to think harder about fundamental life decisions. When it comes to difficult choices, the scientific research summarized in The Five Life Decisions can truly help.”

Annamaria Lusardi, academic director of the Global Financial Literacy Excellence Center at George Washington University

Table of Contents


1: Making Choices
2: More Schooling?
3: Choosing an Occupation
4: Choosing a Partner
5: Parenting
6: Health Habits
7: Wrapping Up

Appendix: Teenage America at the Beginning of the New Millennium
Sources of Information

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