The subtitle of Stephen Marglin's new book gives away the conclusion: The Dismal Science: How Thinking Like An Economist Undermines Community.

First, some context. I did my PhD at Harvard in the early 1980s and was taught economic history by Prof Marglin, Harvard being at that time one of very few leading graduate programs that had a history requirement. One of the papers on the reading list was an eye opener for me – I can't now track down the reference but it was about a floundering toy manufacturer called Hovey and Beard which allowed women production line workers to re-organise their work. Productivity rose sharply, but male managers could not tolerate the loss of hierarchy and ended the successful experiment. At the same time I was starting work on a thesis testing macro labour market models on industry level data and coming face to face with the tremendous differences between industries even at the broadest level of the time series behavour of wages and output and employment. So Steve Marglin played a part in my own evolution from a macro to a micro economist, and from a hardline econometrician to an economist alive to the social and political context for economic behaviour.

The most interesting parts of this book have the same merit of bringing to life the social and institutional richness of the economy. There are several useful chapters about knowledge and information. Much of this part of the book concerns more abstract questions about the status of knowledge, but I particularly enjoyed a chapter called 'Taking Experience Seriously' which is about (althoug he doesn't use this terminology) the characteristics of tacit and non-codifiable knowledge, something which is increasing in importance in the leading industrial economies. Prof Marglin draws an important corollary: “Practically every individual has some advantage over all others in that he possesses unique information of which beneficial use might be made, but of which use can only be made if the decisions to be made with it are left to him.” This points to an important insight about the effects of new technologies on firms: it can only enhance productivity if they are used by people who have tacit knowledge which cannot be programmed into the equipment. And to a possible social or even political consequence – that the productivity consequences of technological change open up the potential for changes in the location of decision-making power.

So parts of The Dismal Science are rich and fascinating in their economic analysis. Other chapters – and here the title give the clue – make the reader wonder how on earth Prof Marglin has managed to spend his career in an economics department, so low is his opinion of economics and economists. His argument is in the tradition of Karl Polanyi's The Great Transformation and Ruskin's Unto This Last, that economics not only admires markets but spreads their scope and makes people abandon traditional relationships in order to act selfishly. I have never understood the status sometimes given to traditional community relationships – perhaps it comes from having grown up in a small town from which I longed to escape, perhaps from being lucky enough to live in a nice bit of a large city (London) which combines friendly neighbourhoods with markets and anonymity uniquely well. Prof Marglin's ideal community seems to be the Pennsylvania Amish, and I don't think I would be in a minority in finding that an unappealing way of life. A more persuasive approach would have tried to understand what it is about markets that has made them so successful and appealing. Nor do I believe him when he argues that markets promote violence: pre-modern societies were much more violent than ours have become since the dawn of capitalism.

In short, the book left me feeling like the course I took more than two decades ago: that Prof Marglin's ideological prism traps some wonderful insights. It will irritate many economists just as much as it will delight many critics of economics (and there are more of those now, for obvious reasons). Nevertheless, I think it repays reading by economists interested in the role of information, and by those interested in economic methodology and the live debate about the nature of the subject.