Homo Economicus

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Homo Economicus

How to get over boredom and frustration when engaging with the most important subject of our time

It turns out, after the 2008 out financial crises, that maybe free market capitalism unhindered by regulation, wasn’t a perfect and flawless mechanism for ensuring growth and prosperity. Suddenly Marx’s Capital was back on the bestseller list and the Social Democrats were taking seats in Congress. So what are “We the People” supposed to think, to believe, to enact?  Here are a few reads to help us get into the problem.

Economics: The User’s Guide by Ha-Joon Chang
This was my stand-out must read for the subject.  Rather than trying to advance a particular viewpoint, Chang takes on the ambitious project of presenting different historically developed theoretical approaches to economics including classical, neo-liberal, Marxist, institutionalist, behavioral and Keynesian. Then we are guided to look at different issues for how they can be analyzed and understood in different ways.  The book is very readable, uses graphics and tables and break-out explanations that add readability and keep the book interesting.  I have walked away with a much better understanding of economics as a complicated field, and see the wisdom of looking at an issue through multiple perspectives in order to gain a depth of understanding.
 
Buddhist Economics by Clair Brown
I was surprised enough by the title to give it a spin.  I consider myself a practicing Buddhist, but I have long considered it more a system of psychology than a religion, and perhaps that was why I initially thought it was going to be a reach.  The book actually extends directly from the core principles outlines in the eight-fold path and talks about how those beliefs would impact and inform how a person might behave in economic situation.  It was much more personal and immediate in its implication, although there are also clear macro-economic principles, including things like zero growth and confronting the greed imperative.  If you are looking to shake up your assumptions and bring in a truly different economic perspective, I would highly recommend this read.

The Wealth of Humans by Ryan Avent
This is a readable and insightful take not just on economics, but on a modern, technological economy by a writer for The Economist.  What happens when machines do the work?  When computer code can be endlessly repeated with minimal additional cost?  We see the realities of a world where lots of people are forced into low paying jobs, which lowers labor cost and decreases the incentive to automate.  The central concern of Avent’s writing is how we share the success our society has created.  If you don’t read anything else on this list, read the last chapter, Human Wealth.  
 
The Hidden Wealth of Nations by Gabriel Zucman
What ever happened to all of the offshore accounts and tax havens that were revealed by the Panama Papers?  Did all the banks and politicians and corporations with egg on their face just bring back the money, honor their social commitments and pay their taxes?  Ha! Zucman is on the case and describes powerful tools proven to be effective in the past that would allow the nations of the world to bring powerful elites to heel.  Does that sound fun or what?  In a read that is fairly technical and will familiarize you with more acronyms than a bar full of GIs, Zucman makes the case the wealth is still out there, sheltered by micro-states (the Cayman Islands, Luxembourg) who live off the fees and power of hiding stolen money.  It’s time to get it back in a big way.

Behavioral Economics by Scott Huettel
As with all the Great Courses we have in the collection, this is truly an upper college level course.  It makes me miss the homework, just to help me get my head around some of the stuff.  Really interesting case studies, but they can be a little few and far between.  If you are interested in behavioral economics then there is another title on this list that has it in a much more condensed form and presents it in a way that very effectively applies it to the world.  However, if you are ready for a deep dive then this is the one for you.

Principles by Ray Dalio
I didn’t expect to find the book so good.  I figured it would be self-congratulatory and ignore the contingent nature of success.  But to his credit, Dalio jumps right in with self-deprecation and humor, including some vulgarity that definitely make this an adult title.  I listened to it on audio book and he read the book himself.  I was completely won over by the time he starts to give the Principles that the book is named for.  Some of it is common sense, some seems to be hard won wisdom.  I’m not sure how to apply everything he talks about, like it doesn’t always generalize from his life, but I would definitely recommend the read and if you have the means, listen to the audio, his voice adds a lot to the narrative.

Applied Economics by Thomas Sowell
This, rather poorly named title, might be better called “Sowell applies his thinking generally to various fields." Rather than provide data or complex analysis to various economic arenas, Sowell shows how to reason from a neo-liberal economics perspective, without the self-awareness that is what he is doing.  The ‘application’ is to various sectors in the broadest possible terms, medicine or politics, and seeks to show that actors have a limited understanding of the secondary and tertiary effects of their decisions.  Unfortunately the book fails to apply any contemporary economic analysis (behavioral, institutional, Keynesian) and ignores the fact that presented evidence undercuts the utility of classical economics.  This book is recommended for those wishing to exercise critical thinking skills and get a sense of the a priori assumptions of Chicago school economics.