There is now definitely a welcome fashion for short, polemical and accessible books. The Aid Trap: Hard Truths About Ending Poverty launches a new series from Columbia University Press. Its authors are Glenn Hubbard, formerly head of the Council of Economic Advisers for George W Bush, and Columbia Business School's William Duggan. This authorship makes the conclusions unsurprising but it is nevertheless a spritely read and makes a good addition to the expanding literature on the failure of the prevailing model of aid.

The headline around which the book is written is the need for a Marshall Plan for developng countries, the distinctive feature of that transfer of funds from the US to postwar Europe being that the money went to business rather than governments. They write of the Marshall Plan:

It was less a sweeping program of foreign aid to governments and
agencies than a large-scale effort to restore the power of business as
a growth engine. A true Marshall Plan for Africa could ignite growth
and reduce poverty, but only through a set of institutions that are
different from those the current aid system is currently using.

I've read by now a ton of books criticizing the aid industry. What new or reinvigorated ideas did I get from this one?

– that economics in the post-war years was so blind to the effect of institutions and the organization of the economy that development and growth economics were applied to socialist and market economies as if there were no difference between them;
– that science and technology don't lead to growth – that depends on the business context in which discoveries are made;
– that NGOs and developent agencies are slaves to 'project' mentality – any need calls for a new project even if there's a more effective alternative provided by business – some good examples here from the famous or notorious Millennium Development Villages;
– that agri-processing is a key step to industrialization for poor rural economies but has been made impossible by farm trade subsidies by the US, EU and Japan (especially the diabolical EU arrangements)

I also liked this quotation from a World Bank assessment in August 2008 that its aid had not reduced poverty in Sub-Saharan Africa: “We must redouble our efforts.” If at first it doesn't work, try and try again?

The authors recommend well-wishers to put their money into enterprise in developing countries rather than aid organisations. (They namecheck the excellent Business Action for Africa.) And they urge that official aid should be restructured – although these recommendations are not as new as they seem. In effect, they urge that official aid is made conditional on pro-business reforms, and that conditionality is made real by phasing out aid for those countries which won't accept or deliver on the conditions. Others including Dambisa Moyo have offered the same advice.

I had a couple of quibbles about the book. The authors use the term 'national socialism' to describe the policy approach of many developing economies, drawing a direct parallel with Hitler's Germany. Even if this is accurate in terms of the narrow comparison between the organization of the economy in 1930s Germany and a developing country now, the phrase jarred with me every time I read it.

The second is the price, a steep $22.95/£15.95 for 180 pages. As I've noted before, this format is highly appealing but my guess is that demand is much more price elastic than this kind of price point implies. Other publishers also charge a lot for these small books, but I for one wouldn't pay full price but might well buy them on impulse at a much lower price point, for a journey or a quiet evening.

Like me, any reader of this blog will be a lover of economics, ideas more generally, and books in particular. How strong is our attachment to that particular artefact, the book, rather than the ideas conveyed? How does the long format of a book, at least 50,000 words and usually much more, affect the ideas we have and how we process them? Questions prompted by two things: an especially interesting column by Tyler Cowen, Three Tweets for the Web, in the Wilson Quarterly (of course his blog Marginal Revolution is always interesting, one of my every-day visits). And the other, the fact that my husband Rory Cellan-Jones (@ruskin147), the BBC's Technology Correspondent, has been testing the Amazon Kindle (launched in the UK this week) and Sony Reader. He blogged about them the other day on the BBC's dot life. We've had the two competing readers around at home for a week.

Here's the heart of Tyler's argument:

The arrival of virtually every new cultural medium has
been greeted with the charge that it truncates attention spans and
represents the beginning of cultural collapse—the novel (in the 18th
century), the comic book, rock ‘n’ roll, television, and now
the Web. In fact, there has never been a golden age of all-wise,
all-attentive readers. But that’s not to say that nothing has
changed. The mass migration of intellectual activity from print to the Web
has brought one important development: We have begun paying more attention
to information. Overall, that’s a big plus for the new world order.

The article is really stimulating, well worth reading through – even though it will take more than 2 minutes.

I find it quite persuasive but have one big doubt, which is about the shrinking of sustained argument. There are things that might be lost if reading full-length serious books becomes even more of a minority interest than it is now. As someone who has written books, I know that it is a much stiffer test of one's arguments to have to sustain them over 250 pages without inconsistency and with due referencing of all the evidence. Is that a discipline we really want to see confined only to scholars?

Less seriously, there's the physical pleasure of reading a book, rather than something on screen. Even when that screen is as clever as the Sony Reader or Amazon Kindle. They are impressive bits of kit, and I simply don't want to sit on the sofa in the evening reading one of them, still less empty out the ranks of bookshelves in my house. The pricing of the books for download also seems unsustainably high to me, especially for a proprietary device which can be controlled by the vendor. I can see the potential of an improved device of this kind for loading up all the work-related papers one wants to read during the day, or the things I sometimes print off the internet to read on the train. But for books? No way. (But do read Rory's alternative view – he likes them.)

There's food for thought here for publishers. I suppose there's no downside in them making books available as e-books in different formats (subject to rights negotiations). But the upside potential for publishing in future may well lie in a different direction. The internet wave has washed over music and has cuaght up TV and film now. Books will be next.

There are two new books out that I will definitely want to read.

One is Superfreakonomics by Levitt and Dubner. The superbestseller Freakonomics wasn't my cup of tea – I found it too gimmicky and some of it not actually about economics but rather distant areas of empirical social science. Some people kindly pointed out that this was no doubt sour grapes on my part as my own book hadn't sold a fraction so well, and maybe that's true as well. However, Tim Harford gave Superfreakonomics a big thumbs up in his review in the FT (and also his blog) this weekend, so I'll certainly contribute to the sales of this sequel and give it a go. (The FT has a system which limits the number of times you can access articles for free, so if you don't have a subscription go for the second of those links.)

The other is Roger Bootle's The Trouble With Markets, positively reviewed in this morning's FT by Chris Cook. I don't always agree with Roger's analysis but it's always stimulating and I'm sure this will be a terrific read about the financial crisis.

As someone who has always been a big fan of Erik Brynjolfsson's careful work assessing how it is exactly that information and communications technologies raise productivity, I wasn't sure whether I'd really like this short book with Adam Saunders, Wired for Innovation. A quick glance suggested it simply summarized his previously published papers, and I've already read those. Would there be anything new?

The answer is that yes there is, a bit, but anyway it's extremely useful to see the arguments and analysis collected in one volume. This is also very concisely done – if anything, a little too concise at just 128 pages of text.

The underlying argument of Brynjolfsson's work with a number of co-authors is that to derive productivity benefits from investment in ICTs, firms need to make parallel substantial investments in reshaping the organization and ways of working. After all, different individual firms derive very different benefits from their spend in technology, depending on how they incoroprate it into the business. This volume sets out that evidence, and makes some additional points.

One is that the measurements and statistics available fail to capture much of the benefit of ICTs. GDP measures the value of internet access by how much people pay their ISPs. Nowhere do economic statistics capture the value people derive from looking at any material on the internet for free – YouTube videos, blogs, use of Wikipedia, whatever it may be. The payment of cash for a physical newspaper is counted but not the value of reading the (still) free online version. This book advocates using measures of consumer surplus – those that already exist, for example valuing the benefit of the variety of titles available at online bookstores, suggest the measures would be large. Time use diaries also make a start at better measurement, as time spent in activities is probably a better indicator of value than money spent, at least at present.

This debate on measurement is set in the context of the fact that GDP never measures the benefit of the increasing variety of goods and serices, new goods, or improving quality, even with hedonic pricing. Equally, the book argues, moentary values are unlikely ever to tell a complete story about the value of online activities because so much more of our spending and time now go on experience goods. Information is a pure experience good, which people can't value until they've consumed it, so it has a strong public good characteristic.

I also greatly enjoyed a section (p100ff) on previous examples of disruptive technologies which defied early expectations that they would destroy the capacity for honest businesses to make money. For example, book publishers strongly argued against the development of lending libraries; journal publishers opposed photocopiers. In each case, the business model had to evolve but the profits continued – journal publishers, for example, started to charge higher prices for those titles most likely to be widely photocopied. The price paid by libraries covered any possible loss of revenue from copying – and indeed, there was in reality next to no cannibalisation because individuals who read photocopies would never have subscribed to the whole journal, absent the copying technology.

Finally, I highly commend the box in Chapter 4 summing up the 7 steps organisations need to take to see the productivity fruits of investment in ICTs (based on a 2005 article by Brynjolfsson and Hitt). Some of them will seem like common sense but few organisations do them.

So, if you are not familiar with this micro productivity literature, and even if you are, this is a very valuable read. There are sample chapters on the MIT Press website  – after all, this is an experience good too.

I've been enjoying – spread over a couple of weeks as it's a longish book – this 2007 biography of John Stuart Mill by Richard Reeves (who now runs the think tank Demos, on whose advisory council I sit). Long ago at university I read Mill's major works, and haven't revisited them since. But of course to any economist utilitarianism has a comfortable familiarity. That has been reinforced, perhaps, by the adoption of the Benthamite benchmark of the greatest happiness of the greatest number by 'happiness' economists such as Richard Layard.

However, the enthusiasm of the happiness crowd for telling me how I ought to behave had begun to turn me off the paternalism and philistinism which are the result of experts deciding what will make the masses happy. The same tendency is evident in behavioural economics too – those who do the 'nudging' know better than those who are to be 'nudged' into behaving better. So it was refreshing to be reminded by this very readable biography of Mill's concern for liberty above all, and his rejection of the raw Benthamite creed in which he was brought up. On Liberty and The Subjection of Women are two of the classic liberal (in the English sense) polemics of all time.

There were inevitably tensions, contradictions, within Mill's thinking. He combined this passion for individual self-determination with an elitist disdain for how the masses would actually choose to lead their lives. The contradiction could be overcome by education, he suggested – as Reeves puts it, Mill believed “a liberal society requires not only a liberal set of rules and laws but also a liberal culture”. But nevertheless Mill blew constantly hot and cold about mass democracy.

Looking at some of the preferences of the masses today, though, which liberal elitist amongst us is free of such contradictions? Mill doesn't seem to have been a likeable person but was certainly an admirable one. His instincts on feminism, on slavery, on the importance of everyday contact with people of other nations were spot on. And in these times of the erosion of civil liberties, his passion for liberty is an inspiration.