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Index of Book Reviews

What I'm Reading Now ...

You are what you read -- or at least I've always thought so. Herewith some thumbnail reviews from my own reading posted to encourage others to read, think, and comment. I don't report on pleasure books (Harry Potter is great, but you won't find it here) or really bad books (with occasional spectacular exceptions). The most recent books are listed first. Use the Index to select previous reviews.

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Benjamin Friedman (not Tom or Milton) is the author of my favorite book about the debt and the deficit:  Day of Reckoning: The Consequences of American Economic Policy in the 1980s (Random House 1988).  It is a great book that deserves to be read and re-read today because we are going down that same unsustainable road once again.

Friedman's new book is also a masterpiece.  Friedman argues that the developed nations of the world should be assigning a much higher priority to increasing economic growth and making those investments necessary to do this.  The reason?  Not because we want more stuff, although the constituency for more if pretty strong in America these days.  No, the reason is that societies tend to function differently when they are experiencing growth than when they are stagnant or in decline.  This is the "moral" aspect of the title.  The expansion of freedoms and the consolidation of democratic values is strongly associated with periods of rising living standards.  Social psychology changes, however, when growth is absent, and freedoms, democracy, and concern for the poor often (but not always) suffers.  So growth is good, to put it far more simply that Friedman ever does in the book, not just for individuals but for their societies. 

There are many things to like about this books.  The first is that, while Friedman states his thesis clearly and forcefully, he makes every effort not to over-sell it.  While he keeps track of evidence that supports his assertions, he also pointedly takes account of exceptions (such as the income security policies enacted in the U.S. during the Great Depression). 

I also appreciate Friedman's multi-dimensional approach.  In the key chapters that interpret US and European history, for example, Friedman begins with economic forces and political actions, which are at the heart of his argument, but then he goes further, citing examples from popular culture (music, literature, films) to illustrate social concerns. 

Although this book is well-written, I cannot say it is an easy read -- not like Thomas Friedman's The World is Flat, for example (see below).  And that's too bad.  The two Friedmans come to similar places at the end -- about the need for increasing saving, lower deficits, greater investment and especially more attention to education.  But Benjamin Friedman gives you a stronger reason why these investments are important -- about the economic, political and social benefits that they can produce.  Thomas Friedman's case is more negative and frankly economic -- invest or smart guys in Bangalore will take your job.  For my money, B. Friedman's case is stronger and more realistic.

Like Steve Levitt's Freakonomics, Financial Times writer Tim Harford's book aims to show how economics can be interesting and useful because economists are good at solving puzzles.  Levitt's book (see below) reports the results of fairly sophisticated economic research in an accessible way, going into depth on a few unusual puzzles.  Reading Levitt, we see a unique mind at work on unexpected problems.

Harford's book, by comparison, wants to show how economic analysis can help each of us better understand the forces that shape our everyday lives by applying economic principles to everyday events.  For my money, this is a more interesting approach -- it is exactly what I try to do in my introductory economic courses.  This is a good book, therefore, but an uneven one.  Sometimes his examples are just brilliant -- they clearly and dramatically reveal the principles and strategies behind economic activities that we unquestioningly accept (his chapters on coffee pricing are just fascinating, for example).  But other times the examples are not as strong, or he topics unoriginal (the market for lemons, for example).  I wish he could have sustained the level of originality that I found in the early chapters.

But perhaps I am being too being too critical. Surely a book like this is not meant for people like me, who already know economics and love it.  This book will be successful if it can fascinate "civilians," as Robert Solow calls people who are not professional economists.  Read this book, especially if you a civilian, and let me know what you think!

Steven D. Levitt and Stephen J. Dubner, Freakonomics: A Rogue Economist Explores the Hidden Side of Everything.  HarperCollins, 2005.

Everyone is talking about this book and it is easy to see why.  Who wouldn't want to read a book that explains why crack dealers live with their moms and how you can tell if a sumo wrestler or a school teacher is cheating?  Stephen Dubner, a New York Times writer, popularizes the scholarly work of University of Chicago economics professor Steven Levitt in this clever bestseller. 

I like this book because it is about story-telling.  Levitt and Dubner point out that what we think we know about social problems is often based less on factual knowledge than our understanding of stories that we hear (and believe) about the world. This book takes a handful of these stories and shows how solid analysis can be used to reveal the truth. Take the chapter about crack dealers, for example.  The conventional wisdom is that there is big money in drugs, which is why drug dealers drive fancy cars and wear lots of jewelry. If you look at the books of a drug gang however (and yes they keep books and one set came into the hands of an economist), you find that only the gang bosses make much money.  The typical crack dealer is looking at the minimum wage or less, which is why he lives with mother.  Most of the stories are good ones, well told, with important lessons to be learned. 

What I don't like about Freakonomics is the way the authors back away from a strong conclusion.  I wish they'd address more directly why it matters that we misunderstand important elements of social life and what we should do about it.  Instead, however, they deny any bigger agenda and simply encourage readers to ask lots of questions -- it's fun!  Well, yes it is fun, but it is more than that.  It's important -- because the answers that the conventional wisdom (and the sellers thereof) provides are so often deeply flawed.

Tim Parks, Medici Money: Banking, Metaphysics, and Art in Fifteenth-Century Florence.  Norton, 2005.

I am a big fan on Tim Parks (see my review of his book A Season with Verona: Travels Around Italy in Search of Illusion, National Character, and...Goals!) and I am very interested in the Medici and the economy of renaissance Italy (I wrote about them in my book Mountains of Debt). So it makes sense that I would rush out to buy a book by Tim Parks about Medici Money.  I suppose, in retrospect, it also makes sense that I would end up disappointed. 

I think what I like best about Tim Parks' writing is his ability to capture the moment -- to bring to the page a strong sense of a particular time and place, which he does best through first person writing. A Season with Verona, for example, is a first-hand look at the politics, economics and sociology of Italy as seen through the eyes of a football (soccer) fan as he travels around Italy with his favorite team and its madcap (and racist?) fans.  Parks tells great  stories about things that I don't know much about and I find them fascinating, although I probably ought to ask more questions about them (are they authentic -- they seem to be?  are they representative?  can they be generalized?). 

These gifts seem wasted in Medici Money, where Parks must be a historian, not a novelist, and cannot really use his most powerful narrative tools.  There is just too much history here for even a skilled writer like Parks to reduce to a series of  memorable scenes with flesh and blood characters.  And I know this material very well, so I have a sense of what's left out and what is stressed and my own opinions about what really matters.  No wonder I'm disappointed.  Knowing something about the Medici and their money actually takes a lot of the fun out of reading this book.  Since the facts cannot surprise me (as they might surprise you), I have to rely upon Parks' writing to keep me engaged and, as I have said, history isn't his strongest suite.

For my money, a better book (but also a different one, intended for a different audience) is the classic The Rise and Decline of the Medici Bank by Raymond de Roover (Harvard, 1963).  It is full of the facts and figures that I love and so rich in insight and detail!  It's the book to read after you've finished Medici Money if you want to know more about money, the Medici and the renaissance.

Tom Standage, A History of the World in Six Glasses.  Walker & Co., 2005.

I really like the idea of this book in theory, although I am a bit disappointed how it turned out in practice. (Am I ever satisfied with a book?  Yes!  See the next entry on this page.)  The idea is to learn something about human history through analysis of a structure of everyday life -- the products that people drink.  You are what you drink?  Well yes, I think so.  Consider the world today and how much we can learn about political economy by simply asking the question, who drinks clean, safe water, who doesn't, and why?  A host of important issues are captured in the water glass.  So I am predisposed to like this book.

Standage divides history into six periods plus one:  beer, wine, spirits, coffee, tea, coca-cola and today's emerging story ... water.  Each era is an opportunity for an interesting story.  Coca-cola is about the development of American consumerism and the expansion of multinational corporations, for example.  The spirit era is an opportunity to talk about the triangle trade -- molasses for rum for slaves.  A clever way to package history, don't you think?

The problem -- the reason I am disappointed -- is that the six (seven counting water) stories are so rich, but the book is so short.  Like Parks above, Standage must leave a lot out in order to make his history fit into a little volume.  Frustrating.  Too much left out for my taste.  I  want the whole story, if I can get it, so that I can make up my own story.

Pietra Rivoli, The Travels of a T-Shirt in the Global Economy:  An Economist Examines the Markets, Power and Politics of World Trade.  John Wiley, 2005.

This is the most interesting book I've read so far this year.  I am really interested in how the details of globalization play out in the real world. So is Pietra Rivoli, apparently.  She is a professor of international business at Georgetown and this book is about her attempt to learn all the details about a t-shirt that she bought at a Walgreen's in Fort Lauderdale in 1999.

The cotton came from Texas, so we learn about the history of cotton farming in Texas and the politics and economics that have shaped the industry in that region for decades.  The cotton bales then traveled to China, where the thread was spun and the t-shirt manufactured.  This stop  permits a survey of the history of cotton cloth production and trade, with special emphasis on China's interesting development in the context of earlier cloth-production centers, such as England, the U.S. and Japan.

The t-shirt's journey back to the USA is full of political intrigue, since it was manufactured in  the days of the Multi-Fibre Arrangement (MFA) the elaborate political system of textile quotas the managed global textile trade until 2005.

Prof. Rivoli's t-shirt is ultimately donated to charity and finds its way into the global market for second hand clothes.  It ends up in East Africa, sold in a village market -- the first really "free market" in its long subsidized, regulated and negotiated life.  The weight of politics on supposedly "free market" processes is apparent in every chapter of this book.

Fascinating from start to finish and really well written, too.  It receives my highest compliment: I wish I had written this book.

If The Travels of a T-Shirt in the Global Economy is interesting, this book is thought-provoking. Michael Weinstein (Robin Hood Foundation and New York Times Foundation) has persuaded a diverse array of economists to explain what is really new about economic globalization today and you will find what they way to be thought-provoking indeed.

The list of contributors and topics reads like a Who’s Who of the field: Jeffrey Sachs on economic growth, Joseph Stiglitz on governance, Dani Rodrik on national policy, William Easterly on international aid regimes, David Dollar on inequality, George Borjas on migration, Charles Calomiris on Global finance, Jeffrey Frankel on the environment,  and Douglas Irwin on international trade. 

Strong points include close analysis of data and rather fearless hypothesis-making and conclusion-drawing, so that you are exposed to new and controversial ideas at every turn.  What’s new, indeed! Weaknesses: the authors are all U.S. based economists.  If you are looking for an analysis of the cultural effects of globalization as viewed from the global South, you should look somewhere else.  A very valuable contribution to the current debate.

Which is my favorite chapter?  I can't make up my mind.  I find Irwin's analysis of the complexity of international trade (production chain trade today versus commodity trade in the past) to be very informative.  I like the way that Sachs brings geography back in to the development field, where it has been taboo for years.  I admire Easterly's tough thinking about why the bureaucrat barrier that has stood in the way of international aid program effectiveness.  But I suppose my favorite chapter is Dani Rodrik's discussion of "feasible globalization," where he explain why he thinks globalization must be harnessed through a renewed Bretton Woods type system.  The logic of his analysis may surprise you.

Thomas Friedman's new book The World is Flat is Globalization Lite (tastes great, less filling).  Perfect for that summer picnic. This book is high-test full-strength brew.  Read responsibly!

William Easterly, The elusive quest for growth: economists' adventures and misadventures in the tropics.  MIT Press, 2001.

 William Easterly's chapter in the book above reminded me about his 2001 book on development theory and policy.  This is a fine book about why many less developed countries have failed to grow in the postwar era and how this dismal record might be changed.  It deserves to be widely ready. 

William Easterly, former Senior Advisor in the Development Research Group of the World Bank; has both broad knowledge of the economic theories that guide development policies and deep experience of their practical outcomes. He is a good example of an economist with a hard head and a soft heart: he cares deeply about the problems of the poor, and he applies good hard analysis to the problem of what to do about it.

Easterly provides first hand accounts of the failures of development theories and development policies and draws from these failures some insights about what possible better approaches.  Policies based upon "scientific" theories of growth, he argues, do not adequately take into account the incentives that they create for governments, donors, and individuals. 

Easterly proposes new policies that actively use incentives to create an environment favorable to economic growth. Everyone who is concerned about global poverty or interested in growth theory should read this book.  

If you are interested in the WTO negotiations and the evolution of the international trade regime, don't overlook this nifty book by Ted Cohn.  Cohn tells the story of the evolution of the postwar trade system from 1947 through the Doha WTO round, with special attention to the changing political geometries of actors, interests and organizations.  Rather that a static focus on the GATT/WTO negotiations, Cohn charts a path that explain how the G7/8, the Quad, the OECD and UNCTAD have influenced trade policy.

Of particular interest is the influence of The Quad -- the Quadirlateral group made up of the US, Canada, the EC and Japan.  Cohn shows how this core group's discussions have influenced trade policy in ways not usually acknowledged by scholars.

Cohn concludes that the multi-level, multi-layer trade governance system continutes, but in a pyramidal structure with the developed countries at the top.  They have the most power, he says, but with power comes responsibility.  He calls on these leaders to avoid losing legitimacy by ignoring the concerns of less developed countries and civil society groups.

A good book to read if you have had enough of "USA is from Mars, Europe is from Venus" arguments.  Ash usefully complicates the argument over US unilateralism versus European multilateralism by pointing out that the perceived differences between the US and Europe disguise important internal similarities.  The historical debate over the focus on power and interest within the US is mirrored by a similar debate within Europe.  By breaking down the problem in this way -- pointing to the two faces of power that seem to exist everywhere -- Ash both complexifies the discussion and makes the prospect of agreement and partnership seem less unlikely.

Perhaps typically, however, he puts Britain in the center of things.  The US and the French have two faces, he suggests, but British power has three faces and it is that third face that gives it the key.  Perhaps.  But tell it to Tony Blair, who is busy fighting for reelection because of that third face.

Jeffrey Sachs doesn’t lack for ambition.  His goal, which is also the goal of the U.N. Millennium Development project, is to end global poverty, preferably within his own lifetime.  This book is makes the case that ending global poverty is not only desirable and necessary, but perfectly possible – via and it provides a political and economic roadmap to get there. 

The book is a sandwich: the bread that holds it together is an essay in persuasion that examines the nature of global poverty, its causes, and presents a short list of principles and basic policies that can help overcome the barriers to growth and greater equality.  Sachs calculates the resource cost of addressing global poverty and concludes, as others have done before, that it is well within our means, if only we make it a priority.  First person accounts of Sachs’s experience as a development economist in Africa, Bolivia, Poland, Russia,  China and India are the sandwich filling. 

Many readers will be drawn to Sachs's Thomas Friedman-style accounts of his personal experiences -- and that's fine.  It isn't what appeals to me, but it helps broaden the audience for the analysis and argument that surrounds it. 

The book’s scope is broad – so broad that experts must necessarily fault it for its relative simplicity.  But much of the educated world remains uninformed or under-informed about global poverty, so the effective audience for this message is huge.  Worth reading.

The World is Flat according to New York Times columnist Thomas Friedman.  That’s the title of his new book, which argues that the collapse of communism and the rise of the internet has broken down the barriers to global competition.  It’s a level playing field, he says, and those smart guys in Bangalore are out to get your job.  And they’ll do it, too, unless American gets smart and invests more in education and innovation. 

Flat world. It’s a nice metaphor, Tom, but you’re wrong.  The world is round, not flat.  And it’s a good thing it is. 

Thomas Friedman argues that the world has become not just smaller, as time and space are compressed, but flatter, too.  Workers and businesses all around the world can compete for U.S. jobs and U.S. markets.  This should scare the hell out of us, Friedman suggests – he compares the economic threat today to the military threat of the Cold War.  We need to do today what we did in the 1950s when the Soviets launched Sputnik – recognize the threat and commit ourselves as a nation to invest more in science and technology.  That’s the only way to keep from falling off – or being pushed off – the edge of the flat world.  

What’s wrong with this argument?  Well, not the conclusion.  The U.S. really does need to save more and invest more for the future.  It’s especially critical that education and training rise to the top of the list of national priorities.  It’s no surprise that I agree with Friedman agree on this point – we both have education on our minds:  Friedman because his daughter has recently gone off to college and he can’t stop thinking about her future, and me because I’m a college professor and I cannot stop thinking about my students’ futures, either.  

The problem is that the rhetoric – the flat world metaphor and the Cold War images that Friedman uses to sell his ideas throughout the book – are what I call globaloney.  Globaloney is argument by metaphor, using what’s hot to sell what’s not.  In this case, Friedman uses exaggerated hot images of cut-throat global competition to try to sell sensible science and education policies that, in today’s political and fiscal environment, might not get much attention on their own merits. 

But I’m  afraid that the Friedman’s “flat world” threat – start spending more on schools or some poor guy in India will take your job --  will be hijacked by protectionist interests and used to promote the sort of destructive, divisive attitudes and policies that Friedman goes out of his way to oppose in his book and that I oppose, too.   

That’s what I fear will happen to Friedman’s flat world.  A clever politician could easily turn the argument around.  The flat world is a threat and the only way to keep out threats is to close our borders and close our minds.  Friedman’s vision of a race to the top, driven by more and better education everywhere, would instantly be transformed into a beggar-they-neighbor nightmare.  And you don’t need to be a newspaper columnist or college professor to see evidence of this sort of argument in the newspaper every day.   

No, the world is not flat – and that’s a good thing.  The way to get ahead in a flat world is to push your competitors off the edge, which is what everyone tried to do in the 1930s with disastrous results. 

The world is round.  What goes around comes around.  The prosperity that we created in the United States by investing in education, technology and innovation has come around the world, as we always knew it would.  If we want to know how to get ahead, we have only to turn around and look to the past to see what made us (and now the world) successful.  

Who stands in our way?  Those smart guys in Bangalore are the threat if the world in flat.  In the round world, however, we know that Pogo was right: we have met the enemy and he is us.  We are the enemy – if we don’t look around and learn from our own past how best to face the future.  And that’s not globaloney.

A brief review of the book by its author -- an idea I borrow from Robert Triffin's classic  Europe and the Money Muddle.

Veseth argues that most of what we know about globalization is rhetoric supplied by self-interested entrepreneurs, who use what's hot (globalization) to sell what's not (their products, policies and ideas).  We need to look beyond images, metaphors and clever narratives, Veseth says, to the facts.  Some, like William Greider, argue that one good story deserves another -- that the best way to fight George Bush's radical/traditional narrative, for example, is with an even better traditional/radical story. Beat 'em at their own game, don't you see?  The way to fight political fire, Greider says, is with fire of your own.

Veseth disagrees.  He says that fighting fire with fire is dangerous because you cannot be sure that you've got the hottest story.  What if the other story-tellers are more persuasive?  The stakes are too high to take that risk.  It is better to take your chances with truth, he says -- to fight fire with facts.

The facts, or at least the search for them, is what makes Globaloney  interesting.  You cannot help but find something interesting in a book that looks for the facts of globalization in fast food and slow food, at football games and soccer matches, through the global market for fine wine and the global markets for second hand clothes. Globalization really is interesting when you look at it this way, with a fine eye for detail and an appreciation of history.  Once you've read Veseth's tales from the global trail you won't be able to think about globalization -- or globalization policies -- in the same simple way again.  That's what he hopes.

Veseth says he's fighting fire with facts -- and there are a lot of interesting facts here -- but he's not telling the whole truth.  Or at least he doesn't tell it until the final chapter, on why France hates globalization (the the US) to fiercely.  After explaining all that he has learned about how to produced and sell globaloney, Veseth admits that he has literally used every trick in his book to write the book and persuade you that his story is true.

It's kind of a dirty trick, but it works.  And that's not globaloney! 

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