Book review: The Economics Book (Big Ideas Simply Explained)

There are many books on the market that try to make economics accessible to a general audience. Some books try to do so using economics research applied to real-world situations (most famously Freakonomics). Others try to unpack economic theory and models and explain them, often but not always through the lens of the history of economic thought (such as The Economics Book by Steven Medema, which I reviewed here; or New Ideas from Dead Economists, which I reviewed here).

The unimaginatively titled The Economics Book, part of the Big Ideas Simply Explained series and written by a large group of contributors (including Niall Kishtainy, George Abbot, John Farndon, Frank Kennedy, James Meadway, Christopher Wallace, and Marcus Weeks), takes the second approach. And like Medema's identically titled book, this book devotes a page or two to each idea, moving more-or-less sequentially through time, with some grouping of similar ideas.

However, while I really liked the approach in Medema's book, I don't think it worked nearly as well in this book. Some of the ideas have too much overlap with others, and so there was occasional unnecessary repetition. There were some ideas early on that seemed to be presented in a surprisingly uncritical way, like the labour theory of value. They were challenged in later parts of the book, but a reader who just dipped into a section or two could easily come away thinking that some old ideas retain currency in contemporary economics, when that is not the case at all.

The book has some excellent aspects though. It contains a number of sections that have a more modern economic debate feel about them, such as inequality and growth, international debt relief, and global savings imbalances. It also contained a two-page section on gender and economics, where New Zealand's own Marilyn Waring was the star. However, it was somewhat surprising that Claudia Goldin (who won the Nobel Prize last year) wasn't mentioned in that section. You could argue that the book was published in 2012, and the authors couldn't foresee Goldin's later award, but they did have sections devoted to other recent Nobel Prize winners, including Diamond, Dybvig, Bernanke, Nordhaus, and Thaler, among others.

There were also aspects of the writing in the book that I disliked, including slight inaccuracies in language. For example, economists refer to 'comparative advantage', not 'competitive advantage'. And, when the price of a good increases, it is 'quantity demanded' that decreases, not 'demand'. And Stephen Dubner is a journalist, not an economist, despite being one of the co-authors of Freakonomics.

Despite those gripes, this was an interesting book to read. I wouldn't rate it as highly as Medema's book, and there are several others that I would recommend ahead of it. However, for someone looking for additional reading that tries to make economics accessible, this would be a good addition to a reading list.