Some familiarity with economic principles will benefit readers, but its conclusions are both accessible and urgent.
A long-view look at a problem that has been vexing economists and policymakers lately—namely, financial and social inequality.
In theory, America is a society not riven by the class divisions of old Europe, and in the beginning, with some exceptions, American colonists were indeed equally not-well-to-do. Independence, write Lindert (Economics/Univ. of California, Davis; Growing Public: Social Spending and Economic Growth since the Eighteenth Century, 2004, etc.) and Williamson (Emeritus, Economics/Harvard Univ.; Trade and Poverty: When the Third World Fell Behind, 2011, etc.), was an expensive proposition, with incomes falling as much as 30 percent. The early republic, however, was an economic phenomenon, and with the steady expansion of the nation into the continental interior, fortunes were built—though, as the authors note, history had a way of intervening, as when the Civil War served as a modest equalizer in the South even as it built still larger fortunes in the North. Of particular interest in this cliometric account are the factors that the authors identify in the making of “the Great Leveling,” which followed the Gilded Age and persisted into the 1970s. “While educational attainment, measured as the average years of schooling completed by adults, advanced by nearly one school year per decade during the Great Leveling,” they write, “a marked deceleration followed.” The lesson here is that education is both a powerful economic engine and a democratizing force. At times critical of the Piketty school of thought, the authors further identify other factors in our present levels of inequality, including the refusal to regulate the financial industry, to fund education, and to tax large inheritances. The opportunities to end inequality are as obvious as C-notes dropped on the ground, they write in closing: “Of course, the fact that they are still lying there testifies to the political difficulty of bending over to pick them up.”
Some familiarity with economic principles will benefit readers, but its conclusions are both accessible and urgent.Pub Date: May 1, 2016
ISBN: 978-0-691-17049-7
Page Count: 424
Publisher: Princeton Univ.
Review Posted Online: March 7, 2016
Kirkus Reviews Issue: April 1, 2016
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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