Economists willing or able to appraise their dismal science and its arguable utility with something other than reverential solemnity are a decidedly rare breed. On the evidence of the ingratiatingly witty text at hand, however, MIT Professor Krugman (The Age of Diminished Experience, not reviewed) can and does subject a dubious discipline to the sort of analysis that could make it accessible as well as useful to the voting public. For all his wry commentary, the author is informed by a serious purpose: he wants not only to determine why the domestic economy is no longer growing at the pre-1973 rates that made America the envy of the Global Village, but also to uncover the reasons for decelerating gains in real income, an alarming spread in poverty, and related obstacles along the rocky road to perdurable prosperity. Toward these ends, he first warns that genus economicus encompasses two distinct species: academics (who pursue typically arcane research projects that, however slowly, can expand mankind's knowledge, if not immediate understanding) and policy entrepreneurs (high-profile go-getters willing to swap the approval of professional peers for acceptance by pols eager for simple, sound-bite solutions to the frequently intractable problems affecting their varied constituencies). In this cautionary context, Krugman surveys cyclical swings in ideology over the past couple of decades, starting with the successful challenge mounted by the right against Keynesian precepts, high taxation, and the welfare state. Focusing, inter alia, on the persistent expansion of federal budget deficits, he next evaluates the checkered record compiled by conservatives in power. Covered as well is the subsequent discrediting of supply- siders, the concurrent emergence of their liberal counterparts (so- called strategic traders), and the renaissance of intervention theory. At the end of the day, the author proves himself an equal- opportunity critic who remains ready to be convinced that even one- note advocates might have something to contribute. An uncommonly sensible audit of socioeconomic fads, fallacies, and fashion. (Charts and tabular material—not seen)
Pub Date: March 28, 1994
ISBN: 0-393-03602-2
Page Count: 290
Publisher: Norton
Review Posted Online: May 19, 2010
Kirkus Reviews Issue: Feb. 1, 1994
BOOK REVIEW
BOOK REVIEW
BOOK REVIEW
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our...
A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.
The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.Pub Date: Nov. 1, 2011
ISBN: 978-0-374-27563-1
Page Count: 512
Publisher: Farrar, Straus and Giroux
Review Posted Online: Sept. 3, 2011
Kirkus Reviews Issue: Sept. 15, 2011
BOOK REVIEW
IN THE NEWS
A readable, persuasive argument that our ways of doing business will have to change if we are to prosper—or even survive.
A well-constructed critique of an economic system that, by the author’s account, is a driver of the world’s destruction.
Harvard Business School professor Henderson vigorously questions the bromide that “management’s only duty is to maximize shareholder value,” a notion advanced by Milton Friedman and accepted uncritically in business schools ever since. By that logic, writes the author, there is no reason why corporations should not fish out the oceans, raise drug prices, militate against public education (since it costs tax money), and otherwise behave ruinously and anti-socially. Many do, even though an alternative theory of business organization argues that corporations and society should enjoy a symbiotic relationship of mutual benefit, which includes corporate investment in what economists call public goods. Given that the history of humankind is “the story of our increasing ability to cooperate at larger and larger scales,” one would hope that in the face of environmental degradation and other threats, we might adopt the symbiotic model rather than the winner-take-all one. Problems abound, of course, including that of the “free rider,” the corporation that takes the benefits from collaborative agreements but does none of the work. Henderson examines case studies such as a large food company that emphasized environmentally responsible production and in turn built “purpose-led, sustainable living brands” and otherwise led the way in increasing shareholder value by reducing risk while building demand. The author argues that the “short-termism” that dominates corporate thinking needs to be adjusted to a longer view even though the larger problem might be better characterized as “failure of information.” Henderson closes with a set of prescriptions for bringing a more equitable economics to the personal level, one that, among other things, asks us to step outside routine—eat less meat, drive less—and become active in forcing corporations (and politicians) to be better citizens.
A readable, persuasive argument that our ways of doing business will have to change if we are to prosper—or even survive.Pub Date: May 1, 2020
ISBN: 978-1-5417-3015-1
Page Count: 336
Publisher: PublicAffairs
Review Posted Online: Feb. 16, 2020
Kirkus Reviews Issue: March 15, 2020
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