Monday, 15 February 2010

'The logic of life' by Tim Harford

This is one of that genre of books that makes Economics popular and ‘sexy’. He works for the Financial Times and has presented BBC television series, and so clearly has the communication skills. He broadly succeeds in his aim of explaining many social and even historical oddities in terms of underlying economic logic. He his persuasive, and the economic logic is persuasive.

It is not revolutionary – many of the things he explains are well known (at least to me), but he explains them exceptionally well, providing many fresh insights and facts. He expounds rational behaviour coming up with less than optimal results, with vivid and gritty examples. He demonstrates how (micro-)economics has become much more practical and science-based in recent years, explaining academic work in easy to understand ways. The economics profession has finally embraced the need to meet scientific standards of experimental testing. The ingenious ways in which they achieve this are worth learning about.

At business school, I found Mico-economics interesting and explanative, but Macro-economics hopelessly boring and of little practical use. Macro-economics tries to explain the workings of an endlessly complex mechanism with over-simplified models, and cannot be subjected to scientific tests. I used to assert that Economics cannot be graced with the name of a science, but certainly some micro-economists have achieved scientific status – as well as becoming popular.

I enjoyed the book and would include it in a list of recommended books on economics.

John Vernon

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