Monthly Archives: December 2017

A look ahead to 2018 economics books

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It’s time for a look ahead to the spring catalogues. As ever, this is slightly random so I’ll be happy to add anything I’ve missed that authors or publishers think would be of interest.

From Princeton University Press, I already reviewed Jerry Muller’s The Tyranny or Metrics, out in a couple of weeks.

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Radical Markets by Eric Posner & Glen Weyl looks intriguing – the argument is that inequality can be diminished and growth enhanced by a radical extension of the scope of markets. Talk about contrarian, in the current climate.

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Daniel Cohen’s The Infinite Desire for Growth is out in English, looking at what growth has been about historically and what future progress will look like.

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I’m super-eager to read Michael Best’s How Growth Really Happens, as a huge fan of his The New Competitive Advantage.

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Paul Tucker, formerly of the Bank of England and now at the Harvard Kennedy School, has written Unelected Power, about the role of central bankers and other technocrats in modern economic government.

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And there’s The Republic of Beliefs by Kaushik Basu.

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MIT Press up next, with an emphasis on tech. They have Terrence Sejnowski’s The Deep Learning Revolution; Meredith’s Broussard’s Artificial Unintelligence; John Kelleher and Brendan Tierney on Data Science; and an essay collection featuring the likes of David Autor, Lynda Gratton and Joshua Gans, What The Digital Future Holds. Also Big Is Beautiful: Debunking the Myth of Small Business by Robert Atkinson and Michael Lind.

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From Yale University Press, I like the look of Pascal Boyer’s Minds Make Societies and Tarleton Gillespie’s Custodians of the Internet. Scott Shane has written Is Entrepreneurship Dead? The Truth About Startups in America. This next one also looks enticing: Trading in War London’s Maritime World in the Age of Cook and Nelson by Margarette Lincoln. Anne-Marie Slaughter’s The Chessboard and The Web could be interesting.

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In its Piketty tradition, Harvard University Press will bring us Thomas Piketty’s Top incomes in France in the 20th Century and also the 2018 World Inequality Report. David Engerman has The Price of Aid: The Economic Cold War in India. I am very much looking forward to reading Cognitive Gadgets: The Cultural Evolution of Thinking by Cecilia Heyes and also William Deringer’s Calculated Values: Finance, Politics and the Quantitative Age.

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Also in the catalog: Privacy’s Blueprint: The Battle to Control the Design of New technologies by Woodrow Harzog; A Business of State by Rupali Mishra about the East India Company; The Right of Publicity: Privacy Reimagined for a Public World by Jennifer Rothman.

Harvard Business Review Press is publishing Prediction Machines: The Simple Economcis of Artificial Intelligence by Ajay Agrawal, Joshua Gans and Avi Goldfarb in April.

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Other university presses. Cambridge has The Fed and Lehman Brothers by Lawrence Ball due out in June; Prioritizing Development: A Cost-Benefit Analysis of the UN’s Sustainable Development Goals by Bjorn Lomborg in May; Patrick Kabanda’s The Creative Wealth of Nations about the arts and economic growth, also in May; and Richard Nelson et al with an overview of Modern Evolutionary Economics.

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OUP: Cash and Dash: How ATMs and Computers Changed Banking by Bernardo Bátiz-Lazo; Inequality and Inclusive Growth in Rich Economies by Brian Nolan; The Wealth of a Nation: A History of Trade Politics in America by Donald Johnson; David Allen Green’s Brexit: What Everyone Needs to Know; and Ian Goldin’s Development in the ‘very short introduction’ series.

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From the various Penguin Imprints we’ll be getting Steven Pinker’s Enlightenment Now; Mariana Mazzucato’s The Value of Everything; David Graeber’s Bullshit Jobs; Linda Yueh’s The Great Economists; Nassim Taleb’s Skin in the Game; Sheela Kolhatkar’s Black Edge; Kishore Mahbubani’s Has The West Lost It?; and later in the year Paul Collier’s How to Save Capitalism from Itself.
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Little Brown publishes Dambisa Moyo’s Edge of Chaos in April; and China’s Great Wall of Debt by Dinny McMahon.
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Profile is publishing David Runciman’s eagerly-awaited How Democracy Ends in May (he has a podcast lecture on the theme online); and Jagjit Chada’s Once in a Lifetime: Rebooting Britain Beyond Brexit in March.
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No doubt there are some exciting forthcoming books I’ve missed – happy to update this post.

Most popular posts of 2017

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The insight from this year’s ‘most popular’ reckoning is …. that people love lists. The first four places in fact go to lists. Here’s the full top ten:

  1. The year ahead in economics books – or at least my gleanings from the spring catalogues
  2. The Enlightened Economist Prize longlist
  3. The Enlightened Economist Prize winner
  4. A look ahead from the autumn publishers’ catalogues
  5. My review of Jean Tirole’s Economics for the Common Good
  6. An appreciation of Will Baumol
  7. My review of a new biography of Edith Penrose
  8. My review of Dani Rodrik’s Straight Talk on Trade
  9. A trailer for Dani Rodrik’s Straight Talk on Trade
  10. A review of Howard Wainer’s Truth and Truthiness

If it was only about traffic, I’d stick to lists, Jean Tirole and Dani Rodrik in 2018.

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No escape from the target setting arms race?

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Among my holiday reads has been Jerry Muller’s The Tyranny of Metrics, published in the UK in a couple of weeks (can be pre-ordered now). The broad thesis of the book, which is a lively read, will be familiar to readers of the literature on the gaming of public service targets. This short book is stuffed with examples of the counter-productive results of insistence on numerical targets.

There is an interesting chapter on the origins of metric-fixation (at least in capitalist economies – the Soviet Union was always rather keen on it), which starts: “The demand for measured accountability and transparency waxes as trust wanes.” Social change following the explosion of protest against authority in the 1960s and the erosion of the post-war class certainties contributed to this process. So did the evident failures in public services and nationalised industries by the 1970s. But as the book goes on to note – and has been explored in the academic literature – public services are not like businesses, having a larger, complex set of aims and depending fundamentally on intrinsic motivation. A thriving public sector is important to the health of the wider economy: “A capitalist society depends for its flourishing on a variety of institutions that provide a counterweight to the market with its focus on monetary gain.”

The book goes on to give a range of examples of targets turned counter-productive in arenas from higher education to medicine and policing to business. Yes, business too. For here targets are linked to remuneration. Yet, as the book notes, economic theory (Holmstrom and Milgrom, as I describe here) and evidence point firmly away from rewarding the attainment of targets whenever individual effort is un-monitorable. Not that this has prevented to spread of performance pay or bonuses, Muller observes: “Although there is a large body of scholarship in the fields of psychology and economics that call into question the premises and effectiveness of pay for measured performance, that literature seems to have done little to halt the spread of metric fixation.” The book ends with a section describing how to use targets intelligently – think about what you’re trying to measure, why and for what purpose. Above all, think. The frustration is that it offers no thoughts about how to roll back the vast swathes of counter-prouctive targetry already afflicting us. Just imagine the outcry if any politician promises a ‘bonfire of the targets’ or less transparency. On the contrary, the arms race seems as intense as ever – when the pitfalls of one type of target are recognized, the solution is more complicated metrics. But dearmament is what we need.[amazon_link asins=’0691174954′ template=’ProductAd’ store=’enlighteconom-21′ marketplace=’UK’ link_id=’77f90151-ea50-11e7-b438-4348033ba2bc’]

Rhetoric and reality in economics

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There are plenty of ill-informed criticisms of economics, alongside the very valid criticisms of the subject. It’s frustrating if one wants to see the discipline move in desirable directions – a higher proportion of women and people who aren’t white & middle class, less ‘boys’ toys’ abstraction, more open (again) to history, sociology and other related subjects, etc – because responding to ill-founded critiques is such a waste of time. Yet the false myths need busting if real reform is to take place.

A recent article by Larry Elliott in the Guardian was outstandingly ill-informed. So much so that it prompted some of the UK’s most esteemed economists to write an excellent reply in Prospect. Their most important single point is, perhaps, that the econ-bashers are feeding the dangerous current in politics of disparaging expertise. We economists need to be duly modest about what we know, but we certainly know more than, say, some current members of the Cabinet.

I tweeted the link to the Prospect article, which led someone to come back on Twitter with this.

NelsonSmythe
@DianeCoyle1859 @prospect_uk Gonna throw a bit of Deidre McCloskey’s ‘Rhetoric of Economics’ in here: https://t.co/vyGzJiHRjx
21/12/2017 08:42

Here is the McCloskey quotation:

rhetSo I turned to my copy of McCloskey’s 1985 Rhetoric of Economics and particularly the postscript to the 1998 edition. There she is at some pains to correct readers of the 1st edition who’d concluded she is ‘against’ mathematics in economics, saying: “A lot of good work gets done in economics, new facts and new ideas. Economists are not stupid or lazy, not at all. I love the field. I belong to the mainstream.” Her target is what she describes as the ‘sandbox for boys’ games’ – ultra-mathematical and abstract – far from a wholesale criticism of maths in econ. Famously, she also condemns the unthinking worship of statistical significance – and indeed any economist worth their salt will also be absorbing the recent papers by Alwyn Young and by Ioannides et al in the Economic Journal.

Still, one can’t plonk The Rhetoric of Economics (remember, pub. 1985) down as a killer retort to the economists’ demolition of the latest dangerously misleading attack. As the Prospect economists note:

The way economics is done has been transformed in the past 30 years with an empirical revolution, meaning we now use fine-grained data on individuals, households and firms. In a recent survey of published work in top journals, over three quarters of papers analysed data collected either by the researchers themselves or from secondary sources. Economists provide evidence, increasingly using randomised control trials, or big data. Often this leads to theories being supported or knocked down: this is the bread and butter of modern economics.

My 2007 book The Soulful Science described a lot of the change since the 1980s this refers to. Perhaps it’s too much to hope for, but I do wish people who condemn economics would actually pay more attention to #whateconomistsreallydo

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Winner of the 2017 Enlightened Economist Prize

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As ever, it has been much harder to select one book from my longlist than it was to narrow it down to those ten. After mulling it over for a few days, I can announce today that the winner is Jean Tirole’s Economics for the Common Good. My review of it is here. It has been widely reviewed elsewhere – here is The Economist and the FT and Breaking Views.

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The reason – apart from it being a great read about the economics profession and about the kinds of policy problem on which economics can shed real light – is that in these times of disparaging ‘experts’ and ignoring evidence, it is great to have such a distinguished economist explaining for a wide audience the importance of evidence and expertise.

Festival of Economics 2017, Bristol Festival of Ideas, Bristol

Festival of Economics 2017, Bristol Festival of Ideas, Bristol

Photo courtesy of Bhagesh Sachania Photography