Book Description

We make choices all the time--about how to spend our money, about how to spend our time, about what to do with our lives. And we are also constantly judging the decisions other people make as rational or irrational. But what kind of criteria are we applying when we say that a choice is rational?What guides our own choices, especially in cases where we don't have complete information about the outcomes?What strategies should be applied in making decisions which affect a lot of people, as in the case of government policy? This book explores what it means to be rational in all these contexts.It introduces ideas from economics, philosophy, and other areas, showing how the theory applies to decisions in everyday life, and to particular situations such as gambling and the allocation of resources. ... Read more

Reviews (1)

Clear but overly technical in its focus
I bought this book on impulse when I was also buying Intelligence: A Very Short Introduction on a recommendation. I'm afraid the moral I now take from this story was "trust recommendations, not your impulses." This was a frustrating book.

I was hoping this book would give me a clear non-technical explanation of the interesting or surprising implications in choice theory. Instead, it gave a clear non-technical explanation of the technical content of choice theory. It seemed indifferent to interpreting what this content meant in practical or non-technical terms.

I think this would be a good book for someone trying to understand the persnickety logical foundations of choice theory but a bad one for someone hoping to understand something about, well, choice and decision-making.

For instance, chapter 2 is almost 20 pages, a fair bit in a book of 120 pages. Yet it devotes itself almost exclusively to explaining the relation between preference functions, cardinal utilities, and ordinal utilities. It discusses the formal conditions necessary for different kinds of preference relations and utilities to be logically equivalent, and the difference between defined terms like "rationality" and "reasonableness".

This is rather dry material, and there was virtually no word on whether these formal conditions were accurate descriptions of people's behavior, or whether we should wish they were. I would have loved to hear a discussion of their intuitive meaning and the extent of their relevance. Are preferences transitive? Is the expansion condition consistent, for instance, with the way people respond to prices through framing effects? I honestly don't know, and I'm annoyed the book was totally silent on these questions. Maybe the criticisms of the formalism of rational decision making are all called "behavioral economics," but it seems like material relevant to a short non-technical introduction.

This pattern persisted in the other chapters, which covered rationality under different forms of uncertainty, risk aversion, strategic behavior in conflict & cooperation, and voting theory.

Another peeve of mine was how the author repeatedly mentioned how some basic definition or another could not be used to justify redistributive taxation. It seemed like he had an axe to grind, since the comment was usually a non sequitur, and since he never went on to discuss the genuine technical issues that I would suppose are involved (inter-subjective utility comparison, the relation between risk appetites and utility schedules, etc.). Frankly, if choice theory is the welter of arbitrary and farflung definitions that the book presents it as being, I wonder that it could be used to justify any political opinion at all!

As I said, the book may a good summary of the technical foundations of choice theory but it offered little insight for understanding human choice or decision-making in a formalized but intuitive way, which is thing thing I wanted. For all I know, the book is comprehensive and accurate, and my response only reveals my own my own prejudices about the field itself. ... Read more

Book Description

In this book Roger Guesnerie contributes to the critical assessment of the Rational Expectations hypothesis (REH). He focuses on the multiplicity question that arises in (infinite horizon) Rational Expectation models and considers the implications for a theory of endogenous fluctuations. The REH, which dominates the economic modeling of expectations in most fields of formalized economic theory, is often associated with an optimistic view of the working of the markets--a view that Guesnerie scrutinizes closely.

The book is divided into four parts. The first part uses the framework of simple models to characterize the stochastic processes that trigger self-fulfilling prophecies and examines the connections between periodic equilibria (cycles) and stochastic equilibria (sunspots). (A sunspot is a random shock uncorrelated with underlying economic fundamentals.) The second part views sunspot equilibria as overreactions triggered by small variations of intrinsic variables--rather than as fluctuations with no trigger--and looks at the consequences for a monetary theoryla Lucas. The third part develops the basic theory to encompass more complex, multidimensional systems. It focuses in particular on the special class of equilibria generating small fluctuations around a steady state. Broadening the scope, the fourth part looks at the stability of cycles, sunspots in systems with memory, and current research on rational expectations. ... Read more

Book Description

Hardbound. This is the second of three volumes surveying the state of the art in Game Theory and its applications to many and varied fields, in particular to economics. The chapters in the present volume are contributed by outstanding authorities, and provide comprehensive coverage and precise statements of the main results in each area. The applications include empirical evidence. The following topics are covered: communication and correlated equilibria,coalitional games and coalition structures, utility and subjective probability, common knowledge, bargaining, zero-sum games, differential games, and applications of game theory to signalling, moral hazard, search, evolutionary biology, international relations, voting procedures, social choice, public economics, politics, and cost allocation. This handbook will be of interest to scholars in economics, political science, psychology, mathematics and biology. For more information on the Handbook ... Read more

Book Description

"This unique and well-tested voice consistently arrives in the future much earlier than anyone else." Nicholas Negroponte, Co-Founder of MIT’s Media Lab "Stan Davis is a master at linking abstract truths and discoveries to specific business applications. What could be more useful? He is a national treasure." John Naisbitt, author of Megatrends and Megatrends 2000 On Blur: "Blur is fast, smart, and useful-a decoder ring that any business person can use to make sense of the turbulence in the world of work today." Alan Webber, Founding Editor, Fast Company "…should be required reading for the millennium." Walter B. Wriston. Former Chairman and CEO, Citibank On Future Perfect: "If you want a hint of what’s going on in the new economy, this vintage book will clue you in." Kevin Kelly, Executive Editor. Wired On 2020 Vision: "…a provocative masterpiece." Tom Peters, Author and management guru On The Monster Under the Bed: "…the single best book I’ve read in years about how all enterprises had better gain and deploy knowledge." Warren Bennis, Author and leadership expert "…a must for understanding how learning technologies are transforming our work and our play, our businesses and our schools, our entire lives." John Seely Brown, Former Director, Xerox PARC "…future visioning at its best." Peter M. Senge, MIT and author of The Fifth Discipline On Future Wealth: "…a valuable guide to the far-ranging, sometimes daunting financial and social transformations ahead." Dr. Henry A. Kissinger, Former Secretary of State "…maps out many astounding and profound societal changes likely to result from the Internet revolution." Frederick W. Smith, Chairman of the Board and CEO, Federal Express "…a mind-stretching look at how an efficient, transparent Internet-connected economy could work." Clayton M. Christensen, author of The Innovator’s Dilemma "…a compelling vision of our financial future." Art Ryan, Chairman of the Board and CEO, Prudential Insurance Company of America "…a formidable manual on how to make sense of risk and opportunities… it will make you work smarter as well as harder." Rudi Dornbusch, Ford Professor of Economics and International Management, MIT "…this book is essential reading if you want to master the new economy." Ken Lay, Chairman of the Board and CEO, Enron Corporation "…stimulates readers to think about how the revolution in information technology opens up new contracting possibilities for their human and financial capital." Bob Kaplan, author of The Balanced Scorecard ... Read more

Reviews (1)

Highly Recommended!
This collection of essays links futurist Stan Davis' previous works with some of his newer ideas about change and commerce. Believing that his ideas (Future Wealth, Blur, Future Perfect, 2020 Vision) have held up, he expands upon them to explain the philosophy he thinks underlies the next 20 years (or "the second half") of the information revolution. He delves into the next era he anticipates, one of even greater consequence - the Bio Economy. He explains not only the rise of biotech, but also the biological or networked economy, where everything is connected to everyone all the time. Moving from theoretical to practical, he advises judging your company's worth by its predicted rate of growth and change, not by traditional measurements. Then, Davis speculates about the more distant future, post 2050, when cloning, stem-cell research and such transcend theory and join the chaos of our everyday lives. If the future makes you gasp, we [...] say read on.
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Book Description

In a front-page story in the Wall Street Journal, Pat Buchanan named The Myth of Free Trades as one of the cornerstones of his protectionist economic policy. Written by Dr. Ravi Batra, bestselling economist and author of The Great Depression of 1990, The Myth of Free Trade throws down the gauntlet to economic orthodoxy and challenges the gospel of free trade. Dr. Batra states that "laissez-faire has wrecked U.S. industry and shattered the American dream."

As an anecdote to our economic ills -- the federal deficit, our reliance on foreign imports, widespread downsizing, environmental destruction -- Dr. Batra sets out a five-year plan for economic revival that includes raising tariffs on imports, banning mergers among giant firms, and encouraging domestic competition by splitting huge corporations into smaller units. ... Read more

Reviews (3)

Myth of "Free" Trade now needs a follow-up
Batra has done a fine job of pointing out the problem. Some want more figures, but the key here is the concept of "averaging". For that, I wish Batra had given us a simple example like the one below:

With some 6 Billion People on the planet, 5 Billion earn less than $1,000 per year (say $5 Trillion) - only about 1 Billion earn around $25,000 or more ($25 Trillion) - with 300 Million those in the USA. So, if 6 Billion people "share" the $30 Trillion total World GDP, that means an "average" of $5,000 for each person.

While a peasant in China might be temporarily better off, it would mean the economic end of the USA, Japan and Europe, then total collapse for the West. If China's current goal is to conquer the West, they can do it without a shot fired - just keep exporting while we keep importing and closing factories.

I only hope that Batra writes a follow-up book quite soon and offers up an overview that all of us can internalize. My further hope is that he can present his comments on CSPAN, CNET and CNN before the US election in November.

the myth of real wages
First let me say that this is a well-written book and does a fairly good job of representing the popular perception that trade can be harmful. Batra gets only two stars from me because of how vague he is on his real wages data. This is an artificial construction that removes skilled labor from calculating wages and then shows a drop in real wages. There is no questioning that a drop in US unskilled labor's wages is happening. This, however, is a meaningless construction because the skilled labor pool is growing, as is its wages. Those are real wages too. The other form of income that Batra ignores is investment income which is available to all Americans who choose to consume less than they earn. Batra knows that the worst consequence of limiting trade is inflation. He tries to present a competition policy that will compensate for the monopolies that a government will create by restricting trade. He presents this as a way to solve the inflation problem, but he ignores the need for greater economies of scale to keep unit costs down. If the coercive power of the state creates artificial competition with firms that are too small to keep costs down, then inflation will still be a problem. It is trade that keeps SKILLED labor's wages rising and trade that keeps inflation at bay.

Well thought out
Well done. It's a shame however that Batra doesn't follow through on this topic in his later books, and gets side-tracked instead by other factors which at best have secondary impact on global economy and ecology. After suffering an entire generation (30 years) of decoupling of per capita productivity and per capita real wage, one wonders how much more stress the US economy can take before it collapses. Then again, what are the limits of human ingenuity and resiliency? Can these factors reverse the damage done by the Free Trade policy? Batra's addressing this factor would have been extremely helpful. ... Read more

Amazon.com

From 1978 through the mid-1990s, China had the fastest-growing economy in the world, and it appeared poised to dominate Asia, and beyond, in the near future. But after focusing on facts rather than theory and looking at the conditions behind the spectacular numbers, Gordon Chang presents the People's Republic as a study in wasted potential: "Peer beneath the surface, and there is a weak China, one that is in long-term decline and even on the verge of collapse. The symptoms of decay are to be seen everywhere." For a nation that has always taken a long view of history, time is quickly running out. Chang believes China has about five years to get its economy in order before it suffers a crippling financial collapse--a timeline he seriously doubts can be met.

By failing to complete its reformation, China has maintained an illusion of progress, Chang explains, but in reality has caused more problems than opportunities for would-be entrepreneurs and foreign investors. Because reform has not been fast enough or comprehensive enough, China is unable to benefit from its modernization or keep up technologically with much of the world. The government's reluctance to get rid of state-owned enterprises has not only rendered China uncompetitive just as it prepares to join the World Trade Organization, but is causing the banks--which were forced to lend money to SOEs--to fail alongside them. Widespread unemployment, corruption within the Communist party, millions of resentful peasants, and a general lack of leadership further threaten stability. The Communist party "knows how to suppress but it no longer has the power to lead," Chang writes, arguing that the party is maintaining control only through the use of brute force and the people's instinct for obedience--popular support that could deteriorate as soon as the economy plunges. Simultaneously, societal ills such as gambling, drugs, and prostitution have become huge problems.

Stuck between Communism and capitalism, "China is drifting, unwilling to go forward as fast as it must and unable to turn back." It is uncertain what will be in the way when the giant finally falls. --Shawn Carkonen ... Read more

Reviews (63)

Pleasantly Surprised
Having heard negative reviews from others (who apparently didn't read the book but were put off by the title), I was pleasantly surprised by Gordon Chang's work. It's one of the best written books on China I have read and presents thought-provoking conclusions based on sound economic and political analysis, which is still relevant two years after the book's publication, and despite growing euphoria about China's role in the world.

Mr. Chang's insights on China's teetering financial system, its links to the state-owned enterprises, and political/ideological constraints to full reform are especially thought-provoking, particularly now that the WTO timetable for opening of China's markets means that competing foreign banks will soon have access to Chinese customers.

Insightful and Beijing goverment actually responses...
Pick up the book in Hongkong on my way to Shanghai. The inside look at China's SOE and bank and how they would cause the problems with China's future. It's a good reading for someone like me who's getting started with business in China.

Though the book is banned in China, I found a interesting Chinese publication called China International Business ... whose issue 174 has a cover story called "Breaking the Iron Rice Bowl." The issue discussed the problems with SOE and Banks. The magazine makes a complementary reading for the book. Some of the things Chang predicted that won't happen does happen. Privitization of SOE with private enterprise acquire SOE, massive layoff in the state bank and others.

One thing bad about the book is that Chang seems to lump sum the Chinese leadership as a collective like Borg in Star Trak. In reality, Chinese leadership is in constant struggle and prograssive and conservitive all win and lose sometime. WTO entry is a victory for the prograssive.

Also, I think Chang use too much Western standard judging Chinese politics. There are no "Read my lip" politics in Chinese politics. There are always something that can be done but never be said.

highly opinionated - few concrete facts
Motivated by a recent visit to China I have begun reading a few books on the subject. G. Chang's has disappointed not so much because it is very pessimistic (as I am certain there are many reasons to be) but rather because of the few facts he delivers. There is a lot of repetitive argument but little to substantiate. For example the accession of China to the WTO is mentioned every so often as an immense problem, yet there is no concrete mention of the sort of problems this will bring China.

Gordon Chang Mea Culpa
Go to Jamestown.org to read Gordon Chang professing his complete and utter ignorance -- slight exageration. Like all China experts (economists more or less excluded), Gordon Chang was trying to paint a picture of the place by viewing it through a straw.

I shouldn't rag on him too much. When facts repudiate his early analysis, at least he is man enough to retract his more egregious assessments.

So Gordon Chang gets 3 stars for sucking it up and being a man... but his book still deserves 1 Star.

open your eyes
To those 'China experts' who base their criticisms of this book on what they have seen in the tourist areas of Shanghai, Beijing, or Guangzhou, I would recommend that a healthy dose of reality is needed. When I flipped through this book when I was still in the West, I wrote the author off as being a pessimest with a chip of his shoulder, and only glanced through this book. But after wandering through the countryside and N.E of China, it became readily apparent that he was speaking in sooth. The facade of China that is presented to the outside world is scarily like the backgrounds used in the old Westerns- a strong gust of wind, and the whole thing will fall over. Perhaps time will prove the author wrong- I hope that it does. I will be sure to give this book a thorough reading when I get back home. ... Read more

Book Description

The Sen and Dreze omnibus comprises three outstanding works by two of the world's finest economists. The volume is a trilogy on the causes of hunger, the role public action can play in its alleviation, and the Indian experience in this context. Together the three works provide a comprehensive theoretical and empirical analysis of relevant developmental issues. ... Read more

Book Description

Business guru Peter Drucker provides an incisive analysis of the major world transformation taking place, from the Age of Capitalism to the Knowledge Society, and examines the radical affects it will have on society, politics, and business now and in the coming years.This searching and incisive analysis of the major world transformation now taking place shows how it will affect society,economics, business, and politics and explains how we are movingfrom a society based on capital, land, and labor to a society whoseprimarysource is knowIedge and whose key structure is theorganization. ... Read more

Reviews (8)

Packed with insight-Unfortunately not packed with references
Drucker is masterful in his integration of business, history and social sciences. This book covers technology, the rise of management and social trends. A great read - my only hesitation is where is the bibliography?

The thesis of the book is that Marx was wrong. The major owner of capital and thus companies are now pension and mutual funds. Thus workers - primarily knowledge workers now are the main owners of companies. There are a couple of flaws in his argument though.

The biggest winners in the current US stock market system aren't the pension funds - its managers and people who start companies or take them public. There is the rise of hidden perks to senior managment - stock options that are essentially free for the managers.

Drucker argues that this is all small peanuts compared with Morgan or Rockefeller.

Other points he makes:

1) Agriculture declined to 2-3% of the workforce. Manufacturing will see a similar declining to 10-15% of the workforce

2) Knowlege workers are more like members of an orchestra. The conductor could never replace the viola players.

3) He forecasts the decline in the Nation state. Governments are driven by pork barrel politics.

An Aberrating Capitalism
When I saw this book, I thought it would give real insight into the future of economics. Because I have a strong knowledge of economics and management theory, I found this book to be rather dry. The title seems to suggest a major change in the structure of economics. I would suggest a more appropriate title of this book would be, "An Aberrating Capitalism".

Drucker's theory is based on the idea that manual labor is declining. To replace it, people will have to have a knowledge needed by employers. In effect, they will be selling their knowledge to the employer. Gone are the industrialists like J.P. Morgan and Andrew Carnegie. In there place are no-name managers, people of knowledge. The structure of the economy has certainly changed in the last hundred years. However, I am not sure the change is so drastic as to label the birth of a new capitalism. If Drucker wants to call this new era "Post-Capitalism", it is still "Capitalism" by definition.

I suspect this book is a useful tool for additional reading in college economics courses and advanced high school social studies courses. I found nothing about the book particularly enriching.

an understanding of modern society
drucker understands the politico-economic realities that drive us all nuts, but he measures it up with magnanimity. the knowledge society--for a knowledge worker his description can actually be somewhat humbling. no more comparing yourself to the laborers as if you've risen above. you depend on others for your living and various forces work against you. i love the way drucker shrugs off government stupidity. he sees through all the hype and hubris, but neither complains nor lectures. ok, sometimes he's a bit dry or bombastic. the originator of the business book style, so cut him some slack.

Discover why the knowledge worker produces growth and Wealth
In Peter Druckers book, "Post Capitalistic Society", he identifies two types of workers: the service oriented worker and the knowledge worker. The knowledge worker produces magnitudes of scale more value to any organization. A knowledge worker represents the "Brains" of an organization. They know how to setup company infrastructure, keep it going, and improve upon its structure.

Capital is not as important as knowledge. Capital by itself does not create wealth, innovation, or increases to productivity. Knowledge produces ideas, innovations, efficiency, and productivity.

A knowledge worker can create a idea without capital, knowledge is brain power. Once the idea is realized, funders provide capital floods transforming the idea into process or product. Knowlege provides an incredible economic company potential. Remove the knowledge worker and growth stops, systems and processes stagnate. Reduce the number of service workers and operations become more efficient. Historically, as service workers number decrease their tasks and output have increased proportionate to their numbers. Basically, the service worker were expected to "Do More with less".

Knowledge represents the whole expertise in domains of finance, information, policy, management, etc.. The knowledge worker generates the "Ideas". Ideas are transformed into processes and systems. Its principles of creativity and credibility which provides trust in the idea. Drucker concludes that knowledge itself is profitable. In the post capitalistic society knowledge produces wealth. Knowledge increase productivity. The sum of knowledge in a domain increases productivity and growth exponentially. Its this radically breakaway phenomenia which knowledge produces providing wealth and growth to an organization.

Knowledge Policy As Root of Economic Stability & Prosperity
Drucker and Toffler agree on one important idea: fiscal and monetary policy is no longer the real driver for national prosperity. At best it is a place-holder, a means of keeping the economy stable. There is a strong element of accountability throughout the book, first with respect to the managers of governments and corporations, and finally with the managers of schools that must ultimately be held accountable for producing students who are competent at both learning and sharing knowledge. For Drucker, the organization of the post-capitalist society must commit itself to being a destabilizer able to change constantly. "It must be organized for systematic abandonment of the established, the customary, the familiar, the comfortable-whether products, services, processes, human and social relationships, skills, or organizations themselves. It is the very nature of knowledge that it changes fast and that today's certainties will be tomorrow's absurdities." So speaketh Drucker of the U.S. Intelligence Community.... ... Read more

Book Description

General Equilibrium Theory: An Introduction, presents one of the great achievements of modern economic analysis (recognized by two Nobel Prizes). General equilibrium analysis studies an economy as a whole, recognizing many interacting markets where prices in one market can affect supply and demand in another. The book is suitable for graduate students and advanced undergraduates in economics and mathematics.It starts with elementary models, presents mathematical preparation and more sophisticated treatments. The treatment emphasizes clarity and accessibility through use of examples and intuition. ... Read more

Reviews (1)

Concise introduction to the mechanics of General Economics
This textbook is a concise technical introduction to the mechanics of General Equilibrium, one of two main branches of economic theory. The text does not cover this extensive field in all its capacity. Instead, we have a step-by-step construction of the main models presented with great care for details, so that the reader can learn precision, careful modeling and all necessary details. Moreover, it's useful for people who have difficulty proving theorems.

There is a special bonus that might encourage you to buy the text. The fixed-point theorems are covered in a brilliant, really excellent way. There is no way around that tool in General Equilibrium, and while having difficulty with more sophisticated texts, I found Starr's book to be very helpful in this respect. ... Read more

Book Description

From humans to hermit crabs to deep water plankton, all living things compete for locally limiting resources. This universal truth unites three bodies of thought--economics, evolution, and history--that have developed largely in mutual isolation. Here, Geerat Vermeij undertakes a groundbreaking and provocative exploration of the facts and theories of biology, economics, and geology to show how processes common to all economic systems--competition, cooperation, adaptation, and feedback--govern evolution as surely as they do the human economy, and how historical patterns in both human and nonhuman evolution follow from this principle.

Using a wealth of examples of evolutionary innovations, Vermeij argues that evolution and economics are one. Powerful consumers and producers exercise disproportionate controls on the characteristics, activities, and distribution of all life forms. Competition-driven demand by consumers, when coupled with supply-side conditions permitting economic growth, leads to adaptation and escalation among organisms. Although disruptions in production halt or reverse these processes temporarily, they amplify escalation in the long run to produce trends in all economic systems toward greater power, higher production rates, and a wider reach for economic systems and their strongest members.

Despite our unprecedented power to shape our surroundings, we humans are subject to all the economic principles and historical trends that emerged at life's origin more than 3 billion years ago. Engagingly written, brilliantly argued, and sweeping in scope, Nature: An Economic History shows that the human institutions most likely to preserve opportunity and adaptability are, after all, built like successful living things.

... Read more

Book Description

Reviews (23)

Beyond Darwin: Cultural evolution and economics
This soberly written book by a Nobel Laureate economist is a summary of the author's thoughts on socialism, knowledge in society, and the evolution of society and what he calls the "extended order" (roughly the interconnected system of transactions that make up the economy). The main argument about cultural evolution is more tantalizingly interesting than conclusively thought out, but anybody interested in history, sociology, economics, politics or even evolution and ethnic differences in modern societies should find fascinating ideas here. My personal opinion is that the work can be fruitfully coupled with several of Thomas Sowell's books, but I'm sure other people will have other perspectives on the work just as interesting. As for economics, the book works out the calculation argument against socialism, an economic argument that to people who have read austrian economics is perhaps the most impressive and thorough argument against communism or socialism ever articulated. If one supports socialist ideals, which Hayek, the author, did in his youth, one should really take this argument into serious consideration. It claims, a claim central to the evolutionary thesis, that socialism as such is simply a misguided attempt to correct a misunderstood system (the market economy) that solves problems (allocation of goods, coordination of economic activites etc.) unsolvable by any other means. Stimulating, original and well written, the book is strongly recommended.

Truly a moral tangle
Written in 1988, THE FATAL CONCEIT is a summary of the economic and political arguments made in the life of its author, F. A. Hayek. I am reading an early printing, the University of Chicago Press published this as THE COLLECTED WORKS OF F. A. HAYEK, VOLUME 1. The attempt was not petty because the scope is so vast, dropping back to magical powers which preceded economics in Appendix G for "a remarkable little study by Sir James Frazer (1909) -- PSYCHE'S TASK" (p. 157) on "Superstition and the Preservation of Tradition" to emphasize "the effect of tabooing a thing." (p. 157). This book is torn from its roots mainly by the times in which it was written, in which it is merely an example of rhetoric as an intellectual discipline that has disappeared as politics has slid to a level that assumes a micro-order no bigger than a box or a flat screen in at least one room of each house in those areas which consider themselves part of the civilized world.

This book is a spirited defense of capitalism as an extended economic order. Hayek is utterly convinced that a close look at history shows that a strong government is more likely to stifle than to promote the efforts of those who could produce productive economic activity by following the rules which economics ought to provide for those with great wealth. The main argument, for me, of THE FATAL CONCEIT is about morality, which is primarily avoided by modern people functioning mainly as spectators concerned with the behavior of human beings who have previously inhabited a world in which people had contact with each other. Attempting to apply the lessons of this book is sure to be ironic in a comic society, in which those who are highest in the public eye merit the lowest form of treatment. For example, the comedy channel on television is ready to ridicule any individual who has no way to escape from whatever comic role our entertainment values have assigned to people in positions of interest, while the audience is supposed to be too complacent to think that they can do anything about what they see. The comedians who ape stupidity are filling in for furiously planning activists of the world, who are blatantly called intellectuals in this book, as in:

"Intellectuals may of course claim to have invented new and better `social' morals that will accomplish just this, but these `new' rules represent a recidivism to the morals of the primitive micro-order, and can hardly maintain the life and health of the billions supported by the macro-order." (p. 75).

Hayek was living in Freiburg im Breisgau in April 1988 when he penned the Preface on page 5, stating "There were to be no footnotes" and he was right until page 24, where the editor furnished information to support the text: "Not only is the idea of evolution older in the humanities and social sciences than in the natural sciences, I would even be prepared to argue that Darwin got the basic ideas of evolution from economics." For Hayek, analogous laws, mechanisms, modalities and "cultural development rests on such inheritance -- characteristics in the form of rules guiding the mutual relations among individuals" (p. 25) that make sense, in the context of group selection compared to biological evolution. "Despite such differences, all evolution, cultural as well as biological, is a process of continuous adaptation to unforeseen events, to contingent circumstances which could not have been forecast. This is another reason why evolutionary theory can never put us in the position of rationally predicting and controlling future evolution." (p. 25).

Having established that the small group environments of hundreds of thousands of years ago established instinctual loyalties that are more ontogenetic than phylogenetic in Chapter 1, Chapter 2 starts with a section on "Freedom and the Extended Order" (p. 29) which starts history with "So far as we know, the Mediterranean region was the first to see the acceptance of a person's right to dispose over a recognized private domain, thus allowing individuals to develop a dense network of commercial relationships among different communities." (p. 29). Hayek gave us no reason to suppose that he was thinking of drastic climate change when he wrote in Chapter 3, "Indeed, it will perhaps not be long before even Antarctica will enable miners to earn an ample living. To an observer from space, this covering of the earth's surface, with the increasingly changing appearance that it wrought, might seem like an organic growth. But it was no such thing: it was accomplished by individuals following not instinctual demands but traditional customs and rules." (p. 43).

Billions of people imply a lot more survival problems than anyone can think for, as President Woodrow Wilson discovered, or maybe died trying, sometime after the Great War, and Hayek is only going to provide support for anyone who is primarily interested in economic activity. On a philosophical level, the most interesting thing about THE FATAL CONCEIT might be the charge of immorality on a theoretical level concerning Keynes, an intellectual opponent of Hayek, who is identified as "self-proclaimed `immoralists' such as Keynes" (p. 67) due to "his general belief in a management of the market order, on the ground that `in the long run we are all dead' (i.e., it does not matter what long-range damage we do; it is the present moment alone, the short run -- consisting of public opinion, demands, votes, and all the stuff and bribes of demagoguery -- which counts)." (p. 57). Television makes a superficial effort to keep people informed of major political issues, but, with even less awareness than economists exhibit of anything beyond the present moment, "is also a characteristic manifestation of an unwillingness to recognize that morals are concerned with effects in the long run -- effects beyond our possible perception -- and of a tendency to spurn the learnt discipline of the long view." (p. 57).

The Fatal Conceit: The Errors of Socialism (The Collected Wo
First volume in the series, i.e.,The Fatal Conceit: The Errors of Socialism (The Collected Works of F.A. Hayek, Vol 1)
by Friedrich A. Hayek, W. W. Bartley (Editor) , in which Hayek passionately sums up his lifelong battle with socialism. This controversial manifesto argues that socialism, from its origins, has been mistaken on scientific, factual, and logical grounds, and its repeated failures are the direct outcome of these errors.

[Misrepresented]
This book was not written by Hayek. It was written by editor and confidant W.W. Bartley when Hayek was sick and incapacitated. The only parts written by Hayek were just random notes that only show up in the appendices.

The Socialist Conceit.
_The Fatal Conceit_ written by economist F. A. Hayek is a firm rejection of economic planning and socialism in favor of classical liberalism and private ownership of "several property" from an agnostic evolutionary perspective. Hayek argues that morality cannot be founded based upon reason alone but that its foundation must be found within the traditional structures that make up society. He argues this from an evolutionary perspective claiming that morality has evolved and therefore been selected for and therefore that it is naive of us to believe that through reason alone we can determine what is ethical. This is in agreement with a religious perspective that would claim that the morality-bearing tradition has been handed down to man from a source which involved an encounter with the Divine (of course, the religious perspective would deny evolution but would arrive at the same conclusion based upon revelation). Hayek, himself an agnostic, discusses these issues in his book and shows how religion can serve as a guardian of tradition. One specific tradition that exists within Western culture is that of private ownership of "several property". Hayek argues that socialism rests on a conceit and is often rooted in an irrational longing for a primitive time (primitivism). Hayek shows how many philosophers and economists including Aristotle, Thomas Aquinas ("the just wage theory"), Karl Marx, Keynes, and Einstein advocated some form of socialism and shows the errors in various aspects of their thinking. Hayek is particularly harsh to Keynes who spoke against the traditional value assigned to saving money, which Hayek feels is absurd. Hayek then shows how socialism is presented as a trade-off; however, involved in this trade-off is the substantial loss of liberty, a value all people should hold dear. Hayek demonstrates how language itself has become infested with words which take on socialistic meanings, and Hayek shows that the very word "liberal" has come to mean the exact opposite of its original intention, i.e. a lover of liberty. Hayek roundly refutes the Malthusian theory of population growth and argues against the over-population scare which is used by the Club of Rome to advance their population control agenda. Hayek shows that in regions which become industrialized and modernized the population growth decreases. This means as more and more regions trade in their premodern existence for an industrialized one the population growth in these regions will go down. The final chapter concludes with a discussion of the role of religion in preserving the traditional system of morality and Hayek's own agnostic philosophy. Hayek argues that it is naive of some to view religion as a conspiracy of the priestly caste to maintain their power, and he shows the value that religious beliefs may have. While I agree with this assessment in Hayek's discussion of religion, I disagree with his agnosticism and failure to recognize a personalized God. Hayek ends with several appendices which discuss various other approaches to economic liberty. In sum this book presents an excellent refutation of the "socialist superstition" which continues to haunt the minds of the intellectual elite to this day. ... Read more

Book Description

While we were waiting for the Internet to make us rich -- back when we thought all we had to do was to buy lottery tickets called dotcom shares -- we missed the real story of the information economy. That story, says Bruce Abramson in Digital Phoenix, took place at the intersection of technology, law, and economics. It unfolded through Microsoft's manipulation of software markets, through open source projects like Linux, and through the file-sharing adventures that Napster enabled. Linux and Napster in particular exploited newly enabled business models to make information sharing cheap and easy; both systems met strong opposition from entrenched interests intent on preserving their own profits. These scenarios set the stage for the future of the information economy, a future in which each new technology will threaten powerful incumbents -- who will, in turn, fight to retard this "dangerous new direction" of progress.

Disentangling the technological, legal, and economic threads of the story, Abramson argues that the key to the entire information economy -- understanding the past and preparing for the future -- lies in our approach to intellectual property and idea markets. The critical challenge of the information age, he says, is to motivate the creation and dissemination of ideas. After discussing relevant issues in intellectual property and antitrust law, the economics of competition, and artificial intelligence and software engineering, Abramson tells the information economy's formative histories: the Microsoft antitrust trial, the open-source movement, and (in a chapter called "The Computer Ate My Industry") the advent of digital music. Finally, he looks toward the future, examining some ways that intellectual property reform could power economic growth and showing how the information economy will reshape the ways we think about business, employment, society, and public policy -- how the information economy, in fact, can make us all rich, as consumers and producers, if not as investors. ... Read more

Reviews (1)

Great storytelling
Don't be scared...this is MIT press, but popular writing. Abramson nails it: why it happened, what's apt to happen in the future. But most of all, this is a great read--the stories are told with such panache that you hardly realize that you are tackling cutting edge issues in law, economics and, yes, politics. Worthy of reading twice: once for the stories, once for the underlying arguments. ... Read more

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"Macrodynamics is a venerable and important tradition, which fifty or sixty years ago engaged the best minds of the economics profession: among them Frisch, Tinbergan, Harrod, Hicks, Samuelson, Goodwin. Recently it has been in danger of being swallowed up by rational expectations, moving equilibrium, and dynamic optimization. We can be grateful to the authors of this book for keeping alive the older tradition, while modernizing it in the light of recent developments in techniques of dynamic modeling." -- James Tobin, Sterling Professor of Economics Emeritus, Yale University

Dynamic Macroeconomics is an attempt to revitalize the traditions of nonmarket clearing approaches to macroeconomics. Using sophisticated tools from dynamic analysis, the authors introduce a consistent, integrated framework for disequilibrium macroeconomic dynamics and explore its relationship to the competing--and currently dominant--equilibrium dynamics.

The book is organized into five parts. Part I covers background models of market-clearing and nonmarket-clearing approaches. Part II introduces short-run monetary models of macroeconomic fluctuations that build on the dynamic interaction of product, labor, and financial markets. Part III explores monetary instability in variants with capital accumulation and growth. Part IV explores supply and demand side Keynesian business cycles and monetary-type growth models. Part V considers the role of the financial sector as a source of instability and fluctuations. ... Read more

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Briefly explains fundamental macroeconomics issues
I found this to be an excellant book for more advanced students (I encouraged mine to read it this past semester). The author gives a splendid explanation of the fundamental economic issues concerning monetary policy and the problems and challenges that plague a dynamic economy. ... Read more

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Taking the shock out of the future
From Enron to the September 11, 2001 disasters, it is apparent things are changing in our world, much as we would like to keep things as they were.

In "The Prosperous Way Down" H.T. Odum does not give us feel-good babble.

Instead, he delivers to us a coherent and timely way to do the hard work of knowing how our world works, the changes that are already upon us, and some of the things we may do to increase our opportunity for security and satisfaction in a world that may be very different from what we know today.

There is a lot of contention about Odum and his eMergy methodology. This is to be expected. Odum brings things together, where others are content to be expert with parts.

The bottom line is that with the intellectual tools Odum lets us discover, we can learn to manage far more complexity than any would normally think possible. He lets us first recognize the problems we have with the signals our society sends out through economic and other circumstances of social behavior. And then the tools he provides let us clean up those signals, so we may make better use of the energy and other resources, the environment, and all the benefits (and problems) inherent in our diverse cultures.

The difficulty in all this is indicated by the fact that there is no Nobel prize for looking at the whole of our world. Those fabulous awards go to those who are very good at knowing parts, with very little idea of how the parts come together.

Instead, there is the very quiet Crafoord Prize for those who try to let us know more about the systems of our world--which of course H.T. Odum and his brother Eugene won back in the early 1980s. ... Read more

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Reviews (9)

Good textbook companion
Academic economists will 'harumph' at this book on the grounds that it seeks merely to destroy undergraduate textbook economics, rather than hard-headed analytically sound economics. Such harumphing is double-edged.

On the one hand it means that it is not compulsory reading for (all) academic economists (although it must be said that the sections dealing with methodological issues and heterodox theories would be informative to academic economists of all stripes).

On the other hand it means that, by the harumphers' own logic, it IS compulsory reading for (at least) undergraduate economists because it does exactly what they condemn it for: lifting the scales from the undergraduate economist's eyes.

As an instructional text, it works best when read along side an undergrad macro/microeconomic textbook because not only does it reinforce the student's understanding of the basic theory, it extends it by means of critical analysis. If nothing else, it should wake a mildly interested student from his or her slumber and then promptly boot them down the road of Critical Engagement. (As I have discovered through first hand experience, it tends to turn students into annoying, and rewarding, interrogators of Received Wisdom.)

Why mainstream economics is dangerously wrong!
This wonderful book written by a genuinely concerned economist clearly documents the main ideas of economics taught to undergraduates (the background to much research in economics) has been documented as being WRONG by research published in major economics journals.

the myth of TINA dismantled
Keen has accomplished from the inside what many critics have attempted, and that is to decisively reveal the fatal flaws of neoclassical economics. Yes, it's a paper tiger, a giant with feet of clay, a Potempkin Village, or my favorite metaphor -- the thundering Wizard of Oz, which is really a little man behind a curtain. With Keen's book in hand, any professor ought to be able to effectively challenge the ruling TINA orthodoxy that "there is no alternative" to The Market. The supposedly iron laws of supply and demand are not iron after all, there is no One Perfect Equilibrium, so it's back to the political economy that prevailed prior to the "marginal revolution" -- politics matters, institutions matter, and the Masters of the World are nothing but Naked Emperors. Keen offers a section on alternatives, and he favors post-keynesian theory, but is fair to other approaches.

As Keen warns, this is not easy reading, and I can't imagine assigning it to undergraduates. Hopefully some economics professors will (I'm a sociologist). But it should be required reading for every professor and graduate student in the social sciences.

At Last !!!
This is a tremendous book which is written in such a way to be of use to both the novice and the 'expert' in any field/sub-specialism of economics. Most undergrad economics training is still steeped in the neoclassical tradition. This book presents the neoclassical paradigm in a most lucid fashion (moreso than many conventional and popular texts) and simultaneously refutes even the most basic tenets on which the paradigm is built. Prof Keen also tackles some rival theories. Progressing through this book I kept feeling drawn to some of the structuralist models, but alas, these are not specifically covered to any significant degree. This book is already on my 10 favourite of all time (see my list). My recommendation for the person to whom neoclassical economics and/or challenges to it are new is to start with this great work and then go on to some of the structuralist and IP literature (suggest: Prebisch; Lewis; Beckford; Lall to start). Specifically for the "non-economist" in the developing world - this helps explain why people have had to pay such a high price as a result of neo-liberal policy imposed on LDC's. It will also help resolve the issue of how within the profession we can brutally criticise our models yet at the same time reject the commonly heard lay-person's judgement of economics as a 'failure'. Reading this we should remember that it is no more a failure than engineering or medicine: these sciences are also supported by evolving masses of paradgims,theories, observations etc.

Econ 101
This book provides a far more clear explanation of the ideas of standard economic theory (neo-classical economics) than do the standard texts (compare with Samuelson, Mankiw, or Barro, e.g.). The book explains utility maximization, indifference curves, and the assumptions underlying the standard economic model that is used by the IMF, the World Bank and all major western governments. Keen uses simple language that even the lay person can follow. The text should be standard reading for every student of elementary economics, but even an experienced economist like Alan Greenspan might benefit from the clarity of thought displayed therein.

Macroeconomic theory is covered from the right perspective, from the result of Sonnenshein et all which shows the basis in microeconomic theory for the standard macroeconomic model. Kirman is mentioned but his seminal connection of liquidity demand with uncertainty is not discussed. The work of Radner should have been included, but then Samuelson and Varian do not discuss Radner's contribution either.Chapter 7 presents the correct perspective on general equilibrium theory, with good advice for students of econ 101.Chapter 8 on Keynes is outstanding, presenting the clearest (and even correct!) textbook discussion of Keynes that I am aware of. Marx's contribution to the basis of capitalism, the recognition of the central role played by the profit motive, is also made apparent in the Keynsian context. The profit motive is ignored completely in Samuelson and the other standard texts, which discuss merely pure barter economies and leave out financial markets altogether. Hicks' interpretation of Keynes' ideas is also correctly presented. All in all, students of economics would be well advised to make Keen's book their main econ text. ... Read more

Book Description

American society today is shaped not nearly as much by vast open spaces as it is by vast, bureaucratic organizations. Over half the working population toils away at enterprises with 500 or more employees--up from zero percent in 1800. Is this institutional immensity the logical outcome of technological forces in an all-efficient market, as some have argued? In this book, the first organizational history of nineteenth-century America, Yale sociologist Charles Perrow says no. He shows that there was nothing inevitable about the surge in corporate size and power by century's end. Critics railed against the nationalizing of the economy, against corporations' monopoly powers, political subversion, environmental destruction, and "wage slavery." How did a nation committed to individual freedom, family firms, public goods, and decentralized power become transformed in one century?

Bountiful resources, a mass market, and the industrial revolution gave entrepreneurs broad scope. In Europe, the state and the church kept private organizations small and required consideration of the public good. In America, the courts and business-steeped legislators removed regulatory constraints over the century, centralizing industry and privatizing the railroads. Despite resistance, the corporate form became the model for the next century. Bureaucratic structure spread to government and the nonprofits. Writing in the tradition of Max Weber, Perrow concludes that the driving force of our history is not technology, politics, or culture, but large, bureaucratic organizations.

Perrow, the author of award-winning books on organizations, employs his witty, trenchant, and graceful style here to maximum effect. Colorful vignettes abound: today's headlines echo past battles for unchecked organizational freedom; socially responsible alternatives that were tried are explored along with the historical contingencies that sent us down one road rather than another. No other book takes the role of organizations in America's development as seriously. The resultant insights presage a new historical genre.

Book Description

A deep gap is growing between the promises of the new global capitalism and the reality of the social breakdown, inequality, insecurity, spiritual emptiness, and environmental destruction left in its wake. What went wrong, and why? In The Post-Corporate World, David C. Korten makes a well-documented case that the new global capitalism is delivering a fatal blow not only to life but to democracy and the market. But rather than simply presenting a doomsday scenario, Korten shows that it isn't too late for change. Drawing on the new biology and a growing understanding of living systems, the book argues that the most promising alternative is a world of healthy market economies that function as extensions of healthy local ecosystems to meet the needs of people and communities. ... Read more

Reviews (16)

Very encouraging -Take 2
Less an etched-in-stone, deterministic prophecy than a playful exercise in new metaphors for economic thinking, The Post-Corporate World would take creative thinkers and doers to a new level of coherence in their economic worldview. The book is for people who feel that there is something fundamentally inhuman in the current social "operating system", but who are looking for structural clarity in their thinking, new ways to articulate what they feel is going on, and possible courses for action. It will not satisfy armchair pundits looking for dirt on the deeds of corporations and their political servants, or those who seek a revelation of the exact future form of society (a la Marx).

Korten [MBA & PhD, Stanford Graduate School of Business] was for twenty-five years a development officer for American agencies in the third world, and demonstrates intimate knowledge of the structure, history, and practice of international capitalism--particularly in its nobler intentions. His focus in this book, however, is the worldview of ordinary people which brings them to accept the inevitability of exploitation and distant, unaccountable ownership-- and how that worldview seems to be changing. Korten here should properly be compared not to academic theorists, but to generalist thinkers such as Rousseau and Thoreau who write from an intuitive feeling about life, sharpened by observations about the larger society and a strong knowledge of the history of thought.

KortenÕs central assertion is that people's economic thought has always been based on their feelings and theories about how Nature works. He argues that our acceptance of the current economy rests on everyone's willingness to believe that natural life is fundamentally a dog-eat-dog competition, as implied by thinkers like Thomas Hobbes and the 19th century promoters of "social Darwinism." The scientific assumption that life evolves, through ruthless competition, towards a positive victory for the "more evolved" species also underlies Karl Marx's theory of the "inevitable" dictatorship of the proletariat.

As readers may know, 20th century biologists have considerably revised their hypotheses about life's evolution and interrelation. While the model of "winner-take-all" evolution may be true for two wolves fighting for the leadership of a pack, it does not at all apply to life's larger processes. Biologists now describe how species evolve more or less cooperatively to fill available niches amongst other life forms. ÒWinner-take-allÓ competitions for scarce resources usually lead to imbalance and catastrophe. The planet we love is a place where all the species of an ecosystem, from bacteria on up, have evolved to benefit most from the independence and interdependence of all the others, in a situation of innovation, dynamic balance, and observance of borders.

KortenÕs hope is that biologyÕs recent findings about healthy ecosystems might clarify our visions of a healthy economy and its present corporate Òdisease.Ó How else to describe a predatory pseudo-lifeform which starves natural innovation and resistance (as by monopolizing markets and buying politicians), extracts life materials from its host (such as clean water, expertise, and time) for strictly monetary ends, while externalizing its wastes and costs (the Òdownsized,Ó the permanent underclass, dead land, pollution) to the public?

Korten fills out the book with stories of people who are trying to promote Òlife valuesÓ in the economy, and suggestions for more coherent and coordinated personal action. He traces the history of Òcorporate rightsÓ in America and the legal fiction that corporations are ÒpersonsÓ under the law; and he illustrates a few images of how a post-corporate market economy might work-- just as food for thought, never as a totalizing utopic vision. Some of these ideas can be found elsewhere, but rarely are they presented in such a coherent and open-ended way. Korten has cross-pollinated impressionistic and critical arguments to carry the weight of his experience, broad curiosity, and disinterested good faith.

Provocative, insightful, engrossing critique of capitalism.
In this provocative book, Korten argues that capitalism is not, as claimed, the engine of wealth creation and champion of democracy and the free market but conversely, it is undermining each of these due to weak public policy and oversight. His analysis probes the problems of society that lie beneath the current strong economy, including poverty, social breakdown, spiritual emptiness, and environmental destruction. He finds corporations are consolidating power on a global level that is eclipsing nations. Korten suggests that the alternative to the current situation is the emergence of a new global system of democratic market economies that are true to the market ideals set forth by Adam Smith. An engrossing book providing important insights and sure to be controversial.

This book simply does not deliver
In titling his book "The Post-Corporate World : Life After Capitalism," you'd think that the author would at least IMAGINE a world without corporations and without capitalism. He does not. He can not. He proceeds to knock the market economy, calling capitalism a cancer, but offers nothing to take its place. This book is only a compliation of