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4.22 AVERAGE
4.22 AVERAGE
A perfect introduction in economics; from the ideas of proper and improper pay for workers, how the economy changes depending on whether it is run via a free market or the monopoly of government; price controls; international trade, etc, and the implications of how each increment of change can significantly affect both the domestic and international economy.
Sowell is masterful in his laconic explanations of how the economy can crash under policies which are confidently voted in favour by the majority of a nation, yet have detrimental costs to said nation, usually under the pretences of political ideologies.
This book gives you a basic knowledge of what each economic decision can cost an industry, nation, market etc, by mapping out the ways in which a person must think - by ignoring emotional demagoguery and replacing it with objective methodological thought.
This book also had a ‘Questions’ section at the back, with over 100 economic-based questions, where the answers can be found by following the page numbers listed below, therefore perfect for studying.
Sowell is masterful in his laconic explanations of how the economy can crash under policies which are confidently voted in favour by the majority of a nation, yet have detrimental costs to said nation, usually under the pretences of political ideologies.
This book gives you a basic knowledge of what each economic decision can cost an industry, nation, market etc, by mapping out the ways in which a person must think - by ignoring emotional demagoguery and replacing it with objective methodological thought.
This book also had a ‘Questions’ section at the back, with over 100 economic-based questions, where the answers can be found by following the page numbers listed below, therefore perfect for studying.
informative
slow-paced
I am, or was, one of those dummies who think economics is all about communism and capitalism, I was fascinated with the former and disenchanted with the later. But I know very well how ignorant I am and my father does very well in reminding me, though he tries to explain sometimes (questions are intolerable!)
However, to me, Basic Economics was an enlightening most-needed read (thanks dad). I've never thought that there is a fundamental definition of economics (the DNA of the whole book): "the study of the use of scarce resources which have alternative uses." And that feudalism, communism, and capitalism, etc.. are just different ways of doing exactly that.
Anyway, Mr. Sowell has a really interesting way of explaining the pros and cons of a certain case, for example, the role of prices as coordinators of free markets by presenting a case where it was otherwise, the centrally-regulated economies. And examples from history and different countries saturate the book.
Also, the idea of the incentives created by certain economy as what matters more than its goals. Consequences are what makes the difference and never the intentions.
I'm very glad that now I really could appreciate the free markets (in reality, however, "free markets" is not totally free, politicians are doing very well with interfering).. and understand previously mysterious things such as stock and black markets, bank systems, and inflation; plus the role of prices and international trade.
Finally, a great new concept to put in mind is that wealth is not money, gold, nor the natural resources of a country.. rather wealth is the goods and services available which increases nations' standard of living.
However, to me, Basic Economics was an enlightening most-needed read (thanks dad). I've never thought that there is a fundamental definition of economics (the DNA of the whole book): "the study of the use of scarce resources which have alternative uses." And that feudalism, communism, and capitalism, etc.. are just different ways of doing exactly that.
Anyway, Mr. Sowell has a really interesting way of explaining the pros and cons of a certain case, for example, the role of prices as coordinators of free markets by presenting a case where it was otherwise, the centrally-regulated economies. And examples from history and different countries saturate the book.
Also, the idea of the incentives created by certain economy as what matters more than its goals. Consequences are what makes the difference and never the intentions.
I'm very glad that now I really could appreciate the free markets (in reality, however, "free markets" is not totally free, politicians are doing very well with interfering).. and understand previously mysterious things such as stock and black markets, bank systems, and inflation; plus the role of prices and international trade.
Finally, a great new concept to put in mind is that wealth is not money, gold, nor the natural resources of a country.. rather wealth is the goods and services available which increases nations' standard of living.
The hardest thing about a free market system is that it is about competition, which means there are winners and there are losers. In a participation trophy age, being part of a losing business proposition is hard - but it doesn't change the fact that the free market produces the best prosperity for the greatest number of people.
Some of these chapters were harder to get through than others, but by and large, I did enjoy this book (despite the 6 months hiatus from reading it in the middle of the year).
Some of these chapters were harder to get through than others, but by and large, I did enjoy this book (despite the 6 months hiatus from reading it in the middle of the year).
Sowell does an amazing job breaking down the basics of economics in an easy to understand and accessible way. This I would consider an essential read. It is not unbiased however. But the information does stir an entire new world of perspectives and different understandings about products, labor, production, etc. Especially with the rise in Marxist critiques of capitalism and the free market this book is a necessary balance to those ideologies and world views. A great starting point to understanding economics, government involvement in the market, and things every consumer should at least be aware of.
Although I would keep in mind that this book does have its pretty apparent and sometimes extreme biases, I still found it incredibly insightful and valuable.
Although I would keep in mind that this book does have its pretty apparent and sometimes extreme biases, I still found it incredibly insightful and valuable.
Never liked my economy courses, but I thoroughly enjoyed reading this book! A authoritative and at time witty introduction to market, prices, bonds, trade and investment. I liked the numerous examples to clarify the concepts and the questions at the back for self-review. Don't expect an unbiased lecture however. This is an unapologetic argument for capitalism, free markets and greed.
As someone who never gave economics a passing glance until the day I resigned myself to learn about it in order to pledge allegiance to being an Informed Citizen, I can say without exaggerating that this book was illuminating, insightful, and immaculately researched while still being fun to read. Sowell's success here is in the book's structure: he presents certain key phrases and themes (He defines economics countless times as "scarce resources which have alternative uses.") and after reducing what many people think of as difficult concepts to their lowest common denominator, will return to these concepts later, until you realize that these ideas have been attracting and condensing in your head all of the information he's tacked onto them. You quickly find yourself with a fleshed-out understanding of the true nature of economics, without all of the political rhetoric and sloppily-defined lexicon that so many of us have grown used to.
If you don't feel like reading all that, just know this: I now have a separate folder in my bookmarks just for websites and articles related to economics. Thanks, T. Sowell, for awakening the raging econ nerd within.
If you don't feel like reading all that, just know this: I now have a separate folder in my bookmarks just for websites and articles related to economics. Thanks, T. Sowell, for awakening the raging econ nerd within.
First I should clarify that I’m a novice to the field of economics (which is why I read this), and so am not really qualified to give an economist’s view of this book, though I do have my own thoughts on the arguments nevertheless. This review should be read accordingly.
Basic Economics is Thomas Sowell’s effort to present the essential facts and principles of economics in layman’s terms for a general audience, without the use of jargon, graphs, or equations. In this sense the book’s approach to economics is rather ‘orthodox’, given that this was the approach Adam Smith and co. used to discuss economic phenomena that could be easily observed at the time.
However, this book is very politicised — and not always objective! It’s clear that Sowell’s agenda is not purely to educate his reader on the basics of economics, but also to persuade them to his way of thinking, which is arguably rather insidious since it’s marketed as a book for total beginners, i.e. new customers entering the marketplace of ideas. To his credit, he does cover the very most basic economic concepts — scarcity, supply and demand, price allocation, return on investment/sales — in a clear and impartial way, but covers more controversial issues — minimum wage, anti-trust laws, government interventions etc. — from a clearly right-wing position, often accompanied by mischaracterisations of the left. The failures of the Soviet Union cannot discredit every possible use of socialised programmes, especially when successful implementations of such policies in e.g. Scandinavian countries are ignored. Beyond the fact that these misrepresentations mean the book cannot be taken as a sincere attempt to resolve these differences of view, tackling these debates from such a one-sided perspective is (in my view) inappropriate for an introduction to the subject, and is the main fault of this otherwise-useful book. He explains the right-wing position well enough, but without including both sides of the argument fairly it can’t really be considered a freestanding, “everything you need to know about economics” sort of book.
Some parts I have mixed feelings about because of the more controversial points not really being appropriate for a beginner. For instance, I thought the discussion of rent controls were particularly interesting as something that seems like a good idea on the surface but actually causes a lot of problems (this is central to Sowell’s message, which basically amounts to “facts over feelings”). Sowell makes the case that rent controls lead to shortages in housing, and therefore to higher rents elsewhere. Without rent controls, rents still rise when there is a shortage of housing, but this creates an incentive to build more housing, which then reduces the shortage and allows rents to drop again — basic supply and demand. I wonder if it is really this simple? However, I reject his conclusion that a planned economy inevitably fails because those doing the planning can’t possibly anticipate the issues facing every group within the economy: if the principles of economics are as clear-cut as Sowell likes to portray, then the lack of tailoring to individualised experience shouldn’t be such an issue. His argument elsewhere in the book that the Soviet Union failed fundamentally because of the lack of incentive to produce seems a better (and more conventionally cited) explanation.
Another caveat I would include is that my edition was slightly out of date in places (Germany has a minimum wage now, since 2015), but seemed to be updated in others (I was caught off-guard by a reference to the 2008 crash). The defence of globalisation is interesting in this context as well, given that these days this is hardly the consensus on the right, and many otherwise-‘free market’ economists seem to avoid the subject. I think this reinforces my view that the discussions of the basic principles are fine, but that some of the more controversial material should be taken with a pinch of salt.
As I’ve said, I’m no expert, but I remain convinced that the principles of a totally free market without a guiding authority are not enough: I still believe a regulated market, correcting against the sources of market failure, produces better results. Government interventions, such as those seen in the American stimulus bill after the 2008 financial crash, are necessary in such situations. Sowell’s intellectual arguments within the field of economics may be coloured by his own biases and ideological stances more generally, but the cause and effect could also be the reverse (i.e. that his right-wing economic views led him to all-round right-wing politics), so I don’t feel the book can be judged purely on this, nor is it directly relevant to the material. I still think the book is a decent portrayal of a right-wing economic perspective, so I don’t wish to mark it down too harshly on this basis. In the conclusion, Sowell stresses that we should always put the facts of what actually works over what we wish to be the case or what sounds nice from the mouths of politicians — this is clearly his principle message. However, I can’t see a partisan effort such as this as the result of an earnest pursuit of truth.
Basic Economics is Thomas Sowell’s effort to present the essential facts and principles of economics in layman’s terms for a general audience, without the use of jargon, graphs, or equations. In this sense the book’s approach to economics is rather ‘orthodox’, given that this was the approach Adam Smith and co. used to discuss economic phenomena that could be easily observed at the time.
However, this book is very politicised — and not always objective! It’s clear that Sowell’s agenda is not purely to educate his reader on the basics of economics, but also to persuade them to his way of thinking, which is arguably rather insidious since it’s marketed as a book for total beginners, i.e. new customers entering the marketplace of ideas. To his credit, he does cover the very most basic economic concepts — scarcity, supply and demand, price allocation, return on investment/sales — in a clear and impartial way, but covers more controversial issues — minimum wage, anti-trust laws, government interventions etc. — from a clearly right-wing position, often accompanied by mischaracterisations of the left. The failures of the Soviet Union cannot discredit every possible use of socialised programmes, especially when successful implementations of such policies in e.g. Scandinavian countries are ignored. Beyond the fact that these misrepresentations mean the book cannot be taken as a sincere attempt to resolve these differences of view, tackling these debates from such a one-sided perspective is (in my view) inappropriate for an introduction to the subject, and is the main fault of this otherwise-useful book. He explains the right-wing position well enough, but without including both sides of the argument fairly it can’t really be considered a freestanding, “everything you need to know about economics” sort of book.
Some parts I have mixed feelings about because of the more controversial points not really being appropriate for a beginner. For instance, I thought the discussion of rent controls were particularly interesting as something that seems like a good idea on the surface but actually causes a lot of problems (this is central to Sowell’s message, which basically amounts to “facts over feelings”). Sowell makes the case that rent controls lead to shortages in housing, and therefore to higher rents elsewhere. Without rent controls, rents still rise when there is a shortage of housing, but this creates an incentive to build more housing, which then reduces the shortage and allows rents to drop again — basic supply and demand. I wonder if it is really this simple? However, I reject his conclusion that a planned economy inevitably fails because those doing the planning can’t possibly anticipate the issues facing every group within the economy: if the principles of economics are as clear-cut as Sowell likes to portray, then the lack of tailoring to individualised experience shouldn’t be such an issue. His argument elsewhere in the book that the Soviet Union failed fundamentally because of the lack of incentive to produce seems a better (and more conventionally cited) explanation.
Another caveat I would include is that my edition was slightly out of date in places (Germany has a minimum wage now, since 2015), but seemed to be updated in others (I was caught off-guard by a reference to the 2008 crash). The defence of globalisation is interesting in this context as well, given that these days this is hardly the consensus on the right, and many otherwise-‘free market’ economists seem to avoid the subject. I think this reinforces my view that the discussions of the basic principles are fine, but that some of the more controversial material should be taken with a pinch of salt.
As I’ve said, I’m no expert, but I remain convinced that the principles of a totally free market without a guiding authority are not enough: I still believe a regulated market, correcting against the sources of market failure, produces better results. Government interventions, such as those seen in the American stimulus bill after the 2008 financial crash, are necessary in such situations. Sowell’s intellectual arguments within the field of economics may be coloured by his own biases and ideological stances more generally, but the cause and effect could also be the reverse (i.e. that his right-wing economic views led him to all-round right-wing politics), so I don’t feel the book can be judged purely on this, nor is it directly relevant to the material. I still think the book is a decent portrayal of a right-wing economic perspective, so I don’t wish to mark it down too harshly on this basis. In the conclusion, Sowell stresses that we should always put the facts of what actually works over what we wish to be the case or what sounds nice from the mouths of politicians — this is clearly his principle message. However, I can’t see a partisan effort such as this as the result of an earnest pursuit of truth.
A well rounded look at economics from the POV of free market capitalism. With a feeling that there are some improtant thing left being unsaid. But a very good intro nevertheless.