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economics for everyone

A common sort of post for a weblog is the book review. I don't know how many book reviews I'll attempt, so this is more of a genre review.

A co-worker, who has been generous with his book recommendations, turned me onto a pair of books written by economists. The first one, which everyone had heard of, is Freakonomics. The second, which may be the better book, is The Undercover Economist.

Freakonomics has gained a lot of notoriety for the link it draws between legalized abortion and crime rates. I suspect it further alienates people with its analysis of "what makes a good parent." This is a shame, because the book as a whole has some extremely interesting food for thought, and the recent trend of "economists writing books about random things" is something that, based on what I've read so far, should be highly encouraged. Happily, this is where The Undercover Economist steps up as a less controversial (and less self-promoting) alternative to recommend.

Economics here is not just about finance, and it is certainly not about incomprehensible terms like "equities volatility exotics". It's about cost, and value, and the natural inclination of people to seek the best (time, monetary, happiness, etc.) value for the lowest (happiness, time, monetary, etc.) cost, given the constraints under which they are operating. This means that the things that are considered "good" to most of the Western world (e.g. an education) may be rendered utterly useless under certain constraints (e.g. living in Cameroon), and so all our attempts to improve the educational system in Cameroon, without attempting to understand or change their constraints, become a waste of time and money.

Freakonomics will only be read by a self-selecting group of people -- this is the consequence of its authors' decision to generate buzz by being controversial. The Undercover Economist is not controversial, so doesn't have much buzz. That gives me more hope that its premise will be understood. Then, maybe we could begin to do the right thing for people in Nepal and Cameroon.


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Comments (1)


i found freakonomics a good book, if you like to read amusing stories and see how people dare to think differently from the mainstream.

i have just bought the undercover economist (on top of the book pile, as it were), but i believe, from your post, that you would like naked economics.

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Posted on May 27, 2006 11:43 AM.

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