The Economist has published an article on books to read to understand how economists think. The selection starts with Milton Friedman’s Capitalism and Freedom,* which is always good. It includes Freakonomics, the old The Worldly Philosophers by Robert Heilbroner (you can do worse for a broad introduction to economic thinkers), Capitalism, Alone by Branko Milanovic and Africa: Why Economists Get It Wrong by Morten Jerven, which I haven’t read; thus I can’t comment upon.
What strikes me as funny is the broader tone. So the author writers about Milton Friedman:
Ignore the fact that Friedman was ultra-libertarian. It does not matter. Very often his arguments were plain wrong. That does not matter either. This book is perhaps the best way to learn to think about trade-offs, because that was how Friedman always thought about the world. For instance, consider minimum wages. Friedman accepts that the people who receive them take home more money. But then the trade-offs come steaming in. What, he asks, about the people who are now priced out of the labour market? Or take regulation of medicines. Unnecessary, he says. Yes, you may save some lives by insisting that pharmaceutical companies jump through hoops before taking a drug to market, as fewer dangerous drugs are sold. But those reviews will also cost lives, he says, by delaying the delivery of safe drugs to patients. (In 2006 we published this article on Friedman and his legacy.)
I wish this sounded more like: get rid of your ideological prejudices for a moment, read Friedman with a clear mind, and you’ll see he was an impressive thinker. But it does not quite sound like that. It sounds like an apology: I recommend a book by Friedman, but I must make it clear that his arguments (which ones?) were “plain wrong”. Now, mind that this is The Economist, not Jacobin.
The sad truth is that we classical liberals tend not to realize how far apart we now are from the mainstream of Western elites. You may tell me that this was always the case. Well, up to a point. Twenty years ago it was true of anti-war libertarians, a tiny group who were ostracized by right and left. But broadly speaking, a certain understanding of the market economy and the dangers of over-regulating it was shared by a good number of people who perfectly fit within the political establishment. Fear of inflation and appreciation of restrained monetary policy was mainstream. For a while, nationalizations were unpopular with the left, socialist parties presented proposals to make welfare more efficient, and it was commonplace, for Davos men and the business elite to say that globalization was a good thing. Now you need to apologize to the readers of The Economist before reminding them that, hey, there are trade-offs!!!
READER COMMENTS
Pierre Lemieux
Sep 1 2022 at 2:47pm
Interesting, and depressing, reflections! I had the same reaction when reading the blurb on Friedman, who was (certainly at the time of Capitalism and Freedom) not very radical. On the other hand, the simple fact that they included him may be encouraging. I have recently noticed a few articles consistent with the old-time free-trade Economist. Is it wishful thinking?
Maniel
Sep 1 2022 at 6:12pm
Agree with the comment. Better to be included (featured?) than not simply because there may be readers capable of thinking and deciding for themselves. Sait-on jamais…
Thomas Strenge
Sep 1 2022 at 6:05pm
I ended my subscription when The Economist endorsed Obama. I have yet to regret that decision.
Juan Manuel Perez Porrua Perez
Sep 2 2022 at 1:01pm
Here is some of what would go in my particular “counterlist” of books:
Universal Economics. Armen A. Alchian and William R. Allen. TBH, this single book could be the list.
The Applied Theory of Price. D.N. McCloskey.
The Theory of Price. George J. Stigler.
International Trade Theory and Policy and The Pure Theory of International Trade, both by Miltiades Chacholiades. (note: Buy, borrow, or steal!).
Interregional and International Trade. Bertil Ohlin.
The Theory of International Trade. A. Dixit and V. Norman.
Gary S. Becker: Economic Theory. A Treatise on the Family. The Economic Approach to Human Behavior. Becker’s video lectures from a course on human capital.
Foundati0ns of Social Theory. James Coleman.
Economy and Society. Max Weber.
Milton Friedman: Free To Choose, Price Theory, Capitalism and Freedom, Essays on Positive Economics and Two Lucky People: A Memoir (coauthored with Rose Friedman).
F.A. Hayek: Individualism and Economic Order. Law, Legislation, and Liberty. The Road to Serfdom and The Constitution of Liberty (supplemented by this article by Richard A. Epstein).
Ludwig von Mises: Opera omnia.
Richard E. Epstein: Opera omnia.
James M. Buchanan: Opera Omnia.
Centesimus Annus: Encyclical Letter On the Hundredth Anniversary of “Rerum Novarum”. Pope St. John Paul II.
Hidden Order: The Economics of Everyday Life. David Friedman. Also his Law’s Order and all of his articles on law and economics.
Evaluación social de proyectos. Ernesto R. Fontaine. I don’t know if this exists in English or not, and if it doesn’t: Cost-Benefit Analysis for Investment Projects (Glenn Jenkins, Kuo Yan-Chun, Arnold C. Harberger).
Economic Analysis of Democracy. Randall Holcombe.
The Economics of Contracts: A Primer. Bernard Salanié.
Jack Hirshleifer: Investment, Interest, and Capital. The Analytics of Unvertainty and Information. On the Economics of Transfer Pricing.
Papal Economics: The Catholic Church on Democratic Capitalism, from Rerum Novarum to Caritas in Veritate. Maciej Zieba, O.P.
Richard A. Posner: The Economics of Justice. Economic Analysis of the Law.
Juan Manuel Perez Porrua Perez
Sep 2 2022 at 1:02pm
Sorry, it came out with no formatting.
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