It's not entirely clear whether this is just a book or a book plus multimedia experience, but either way Poor Economics by Abhijit Banerjee and Esther Duflo is a fantastic resource. I have the book on order – the blurb says:

“Their book is radical in its rethinking of the economics of poverty, but
also entirely practical in the suggestions it offers. Through a careful
analysis of a very rich body of evidence, including the hundreds of
randomized control trials that Banerjee and Duflo’s lab has pioneered,
they show why the poor, despite having the same desires and abilities as
anyone else, end up with entirely different lives.”

Meanwhile, the website has videos, data and links for each chapter – well worth a browse.

I've been dipping into Economic Lives: How Culture Shapes the Economy by Viviana Zelizer. It has been both fruitful and irritating.

Fruitful because this eminent economic sociologist covers some of the most interesting terrain in economics. In the past she has written about the concept of modern childhood in Pricing the Priceless Child, and about The Purchase of Intimacy. I've long believed economists should pay more attention to the sociological aspects of economic institutions. Would we be in the same boat in the financial crisis if there had been more careful study, including by economists, of the sociology of financial institutions? Yet few sociologists have entered that terrain – Donald Mackenzie is one exception when it comes to finance.

So I very much welcome Zelizer's research agenda. This volume is a series of essays covering the valuation of human lives, the social meaning of money, intimacy and caring, as well as some more general ruminations on capitalism and the economy. There is a lot of absolutely fascinating insight in the essays I've read so far, especially the historical accounts of how some economic structures and institutions have come about.

My irritation is twofold. One is a constant complaint about the impenetrable language of academic sociology. I know we economists have our own jargon, but I found Zelizer just as heavy-going as most other sociologists. Please, publishers, could you encourage some pop sociology for frivolous readers like me?

The other is the author's tendency to be as dismissive of economists as – to be fair – many economists are of sociology. I suppose I should be hardened to the way critics of economics are criticizing a straw man version of my subject but it does become wearisome. However, there is a more substantive issue, which is that economics itself offers some deep insights about human motivation. Behind the caricature of selfish calculating machine human beings in economic models, there is an evolutionary truth about self-interested actions. Behind the abstraction of identical individuals engaging in market transactions, there is the truth that the anonymity of markets brings real benefits to people compared with the stasis and intrusiveness of traditional (usually rural) economic relationships. Traditional economies have their downside – they limit mobility and human potential, trap people in hierarchies, discourage innovation, at worst become tribal and repressive. In other words, the sociology of markets is multifaceted and conventional economics approaches set out one of the facets very clearly. Partha Dasgupta has written illuminatingly about this.

Still, in the interests of fruitful exchange between economists and sociologists, I think this debate is only to be encouraged, and this is a volume of sociology well worth economists having a look. It also offers a good introduction to Zelizer's previous books.

PS Apologies that this blog has been offline for a few days due to technical problems. Full service resumed again!

This weekend's Financial Times had an interesting feature (Readers of the World Unite) about the campaign by US writer Dale Peck against big booksellers – both physical and online. He has launched a publisher, Mischief & Mayhem, which aims to ensure literary authors can reach an audience. The big booksellers, he charges, ensure that most publishers will only accept obviously commercial manuscripts. There are tales of authors being asked to make characters better looking, or to avoid feel-bad issues such as the death of a child.

What's interesting about this is the question of whether – or rather to what extent – winner-take-all dynamics are inevitable in publishing. The demand side and supply side conditions are certainly there for those dynamics. On the demand side, reading a book is an 'experience good' and readers will use other readers' recommendations as a signal of a good read that will not waste their time. This can outweigh even the most brilliant writing that not many people know about. Hence writing fiction, too, has its superstars now just as the movies always have. On the supply side, the economies of scale in marketing a literary star and the use of 'other people who bought this liked….' style recommendations interact with the demand side forces. What's more, because this is a dynamic phenomenon, it can intensify over time.

The FT article quotes sociology prof John Thompson in support of the argument:

“The literary marketplace looks more and more like a winner-takes-more
market, concentrating on a small number of titles that sell
exceptionally well, indeed, better than ever, whereas the number of
titles  that sell in modest but acceptable quantities is declining.”

On the other hand – there has to be one – online technologies and on-demand publishing do make it possible for non-superstar authors to reach an audience if only they can get people to notice them. The internet enables the long tail as well as the superstar economics. The number of titles being published in both the US and UK has been trending upwards, even if weight of sales is tilting towards the top-sellers.

There are figures which could help settle the question empirically, although they are not freely available but sold as a commercial service. So I don't know the answer. Either way, in my book a new publisher is always welcome.

The Economist's Oath: On the Need for and Content of Professional Economic Ethics by George DeMartino is a very stimulating book, although I disagree with the author's argument.

Let me start by summing it up. Economists have great influence over the lives of many other people because they are so influential in public policy jobs. Even when practised by moral people, economics has proven harmful – look at the financial crisis, or the effect of IMF austerity policies, or the collapse of life-expectancy in post-Soviet 'shock therapy' Russia. Economists have always resisted the idea that they need a professional ethical code because they see their role as the scientific investigation of social realities – when working in government they are doing so as technicians, not as philosophers or politicians. What's more, economists say, there are no barriers to entry. Unlike medicine or law, anyone can describe themselves as an economist and maybe even get a job as one. DeMartino rejects the positivism of these self-descriptions, saying economists must recognize that neutral policy advice is impossible in their field. And while there are no barriers to entering the profession, he argues that economists have created an intellectual monopoly and developed their own power in policy decisions. Economists' “faith in free markets” caused the financial crisis. What's more, economists are sloppy in their econometrics and tied to orthodoxy in their beliefs. Professional ethics are needed urgently so that the training of future economists includes awareness of the inherent contestability of economic models and policies.

I think this is a fair summary, and it would be hard to disagree with some of the steps of the argument. On the other hand, it's clear that DeMartino opposes 'orthodox' economics and – as so many 'heterodox' economists do – sets it up as a monolithic set of beliefs which actually only represent the views of a sub-section. For example, there are not many orthodox economists who cling as ardently as Eugene Fama to the Efficient Markets Hypothesis.

Another weakness in his argument is that he slips between discussing academic economics and applied economists working in policy jobs. The latter group are those he would like to adopt professional ethics as they make the decisions that affect others. However, it's the academics (mainly American) who develop the theories the policy economists (around the world) apply; and it's some of those theories that DeMartino objects to. As I noted in my previous post on this book, economists may be best compared to certain groups of non-experimental scientists such as geologists or astronomers, in trying to discover how society/rocks/stars work.

I think he also downplays the importance of economics not being a closed shop and overplays the idea that there is a professional consensus advanced by a powerful economic priesthood. Certainly economists try to keep out amateurs with the use of jargon and institutional structures, but largely they fail – to the extent that it's become a cliche that you can find an economist to argue any side of a debate. ('On the one hand.. on the other hand….') The idea that there is an “intellectual monopoly” in economics (p106) is vastly over-stated, and it is those who like to identify themselves as 'heterodox' who try to claim this. (My previous book, The Soulful Science, tried to show how varied and rich the house of 'conventional' economics is.) I think the power of free market economic philosophy in the early 1980s stemmed from the political power of Mrs Thatcher and Mr Reagan, rather than the other way round. The tide of free marketism had receded within the economics profession itself long before the financial crisis.

DeMartino says the Economist's Oath needs to recognise two principles: Do No Harm; and recognise people's autonomy by getting their advance consent. I would suggest that policy economists would be mystified by the idea that they need to codify the first of these, as all the economic assessment of policy incorporates at a minimum a benefit-cost analysis and often – as in competition policy – an explicit consumer and citizen welfare analysis. The policy advice might turn out to be wrong but it is always trying to 'do no harm' – subject to the caveat that there will be winners and losers, and therefore ultimately political judgments about the balance of benefit and harm. When it comes to gaining consent in advance, this is inextricably bound up with the legitimacy of those implementing the decision and therefore also a political question. In a democracy, an elected government has gained prior consent for its policies.

Having disagreed with the author's argument so much, the book ends with a sample 'oath' it would be hard to object to in outline – serve the public good, recognize the limits of economics and its links with political choices, watch out in particular for the weakest members of society, and keep in mind the virtues of pluralism in economics itself. I think most 'orthodox' policy economists would see themselves as already signed up to these principles – unless by 'pluralism' DeMartino means they ought to agree with him.

I do think economists of any variety would enjoy reading this book. It makes some valid points about weaknesses in economic practice, and about the fact that the economics used in the policy world is often actually political economy and so should not be portrayed as objective truth. My version of an economist's oath would certainly include careful econometrics, acknowledgment of alternative perspectives and humility. The book is also clearly written and jargon-free with some interesting history of the past debate within the profession about codes of conduct and ethics.

In the past I've written on this blog about Open Book Publishers, a recently founded academic press publishing on the open access model – the books are published in the Creative Commons framework. They are non-profit and use print on demand technology so prices for physical copies are around £14 (or £25 for a hardback), which is about the same as the lowest prices charged by other academic publishers. Electronic versions are of course much cheaper – around £5.

Their list has grown since then and includes some forthcoming economics titles that look promising: one is David Levine's Is Behavioural Economics Doomed and another is a volume edited by Amartya Sen, Peace and Democratic Society. There's also a recent volume of essays on the history of copyright (£4.95 as a pdf, £14.95 for a physical copy). The essence of the model can be found on the information for authors page.

The website says: “We are excited that, during
our first two years of operation, our free online editions have been
accessed by people in over 120 countries, and that each of our books is
being viewed by about as many people per
month as
many traditional print-only titles will reach in their entire published
life.”

Founder Rupert Gatti recently published an article (pdf here)  in the Cambridge alumni magazine making the case that all academic work should be published under a Creative Commons licence. The purpose of academic research, he argues persuasively, is to share knowledge whereas the aim of publishers is to restrict access to varying degrees. Copyright on academic works benefits the publishers, who no longer, however, serve the purposes for academics they used to for the researchers. Publishers are no longer essential to reach readers, very few scrutinise and edit manuscripts as they used to, and publishers' selection of what is worthy may well differ from an academic assessment, for publishers more clearly want what will sell. His article is well worth a read.

My experience via this blog and previously as a reader is that academic publishers vary quite widely in their policies and attitudes. Some would share fully Open Book Publishers' commitment to scholarship and public value – I'd certainly include my own in that category. Others are clearly more commercial and price for a small number of library sales. I think the commitment is more important than the choice of business model, because – as in any other area of business – it's values that ultimately determine behaviour.