What are the key economic concepts that a manager needs to understand? That is the question that is answered in The Instant Economist, a 1985 book by John Charles Pool and Ross La Roe. This is a pop-economics book from a time when pop-economics didn't really exist as a concept. Nevertheless, it has aged really well, and is not to be confused with the 2012 book of the same title by Timothy Taylor (which I reviewed here a few years ago).
Pool and La Roe cover concepts from macroeconomics, microeconomics, and international economics, pulling out the key things that a manager needs to understand in each area, and explaining them in a quite straightforward way. The narrative style is the story of an MBA graduate whose father has sent him to talk to an economics professor because, while he understands all of the maths, he doesn't understand any of the economic intuition from his business degree. Regular readers of this blog will probably realise that is a setup I have a lot of sympathy for. Clearly though, the book was written for a different time - the professor's lunch consists only of two martinis at the staff club, just before he heads in to teach a graduate managerial economics class!
I found the microeconomics section to be particularly useful and still current. The macroeconomics is a bit dated and even the simple models of macroeconomics have moved on a bit from how Pool and La Roe write about it. The 'bathtub model' of macroeconomics was an interesting device, but probably wouldn't stand up to much scrutiny now. The international economics section is more-or-less limited to exchange rates, international investment flows, and the gains from trade.
This was a really good book, and I enjoyed it a lot. It also gave me some ideas on framing the importance of elasticities in particular for management students. Recommended!
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