Basic Economics: A Citizen's Guide to the Economy

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Basic Economics: A Citizen's Guide to the Economy

4.24 of 5 stars 4.24 · rating details · 2,086 ratings · 219 reviews

This is the revised and enlarged edition of a new kind of introduction to economics for the general public-without graphs, statistics, or jargon. In addition to being updated, Basic Economics has also become more internationalized by including economic problems from more countries around the world, because the basic principles of economics are not confined by national bord...more

Hardcover, Revised and Expanded Edition, 448 pages

Published December 24th 2003 by Basic Books (first published 2000)

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Oct 05, 2008 Trevor rated it 1 of 5 stars

Shelves: economics

You are, of course, familiar with the German word schadenfreude – the malicious joy one gets on hearing of the misfortune suffered by others. I can’t deny that there were times while listening to this book this week – a week in which the US decided to pour $700 billion into the black hole that is the ‘credit crunch’ – that this word popped unbidden to the front of my mind. Listening to the rants of a radical free market economist in the week that the world is forced to pay for the excesses of ma...more

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Nov 19, 2008 Jarrod Jenkins rated it 5 of 5 stars · review of another edition Recommends it for: everyone

Shelves: nonfiction

Thomas Sowell is a god. I'm a big fan of his writing style because it's clear and concise. Basic Economics is highly informative and easily accessible. This book should be required reading, not just for econ majors or business majors, but everyone.

Big ideas:
1. Economics is about trade-offs, not solutions.
2. Every policy or law has consequences, many of which are negative and unforeseen.
3. Capitalism is the least oppressive or racist system for allocating resources; very few people will refuse...more

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Sep 25, 2008 Skylar Burris rated it 5 of 5 stars

Shelves: economics

I would recommend this introduction to anyone who wants to learn the basics of economics in order to be a better informed citizen. It doesn't use technical jargon, but outlines basic principles clearly and in plain language, without graphs or equations, using real life examples. Sowell is obviously annoyed by the general ignorance of economics experienced by your average person, particularly by journalists and even politicians, and he sets out to make the basics clear. The basic principles he ou...more

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May 03, 2008 Gavin rated it 5 of 5 stars · review of another edition Recommends it for: Everyone

Shelves: economics

This is one the the most important books I have ever read. It is clear, concise, and very pertinent to modern day politics and public policy. It explains economic thinking without any of the math. What this book will give you is a understanding of how to use scarce resources that have alternative uses within an economy. This book scrutinizes policies that are meant to help people, but actually do more damage than good such as rent control, education subsidies, minimum wages, social security, "fr...more

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Feb 09, 2009 Carli rated it 5 of 5 stars

Thomas Sowell is a genius. I knew that going into this book, but now I'm completely convinced. In the spirit of refusing to be passively educated by pop culture and the media, I have decided to educate myself on hot topics by reading material from authorities on the subject. Thomas Sowell and this book fit into that profile (and, yes, I am that much of a geek that I'm exclaiming over an economics book!).

Please note that, although this is not written in high academic prose, it is still not happy...more

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Feb 07, 2009 Elyse Martin rated it 5 of 5 stars · review of another edition

Shelves: political-historical-or-economic

This is an amazing book and absolutely a must-read if you want to understand the basic causes and effects of a free market economy.

Here's a warning. If you have any passion at all about politics, or concern about government intruding into your life, or if you're the least bit cynical about politicians, be prepared to pull your hair right out of your head. I wanted to throw this book across the room several times, but finally promised myself I would write a letter to Dr. Sowell when I finished i...more

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Jan 27, 2008 Joseph rated it 5 of 5 stars · review of another edition

A clearly and concisely written analysis of how incentives impact the economic decisions people make. Most notable is the idea that communism fails not only because of people's propensity to cheat in an environment free of incentives, but because of the fact that even in a world full of non-cheaters, a price-control system cannot allocate resources with the same efficiency that a market does automatically. Sheds some light on how a country like the USSR can sit on such expansive natural resource...more

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Jan 11, 2011 Tom X. Tobin rated it 4 of 5 stars · review of another edition

This book irrevocably infected me with a basic grasp of economic principles —and considering how often this makes me want to scream in frustration at the world around me, I'm not sure if that's a blessing or a curse.

I've long held a somewhat fuzzy understanding of economics— people buy things they want, companies make things for people to buy, people always want more than they could have, and so forth. What Basic Economics did was lucidly lay out the principles of economic behavior in a way that...more

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Feb 11, 2009 George rated it 3 of 5 stars

This book is a decent introduction to the alien concepts of the other half of the population who see everything in dollar amounts, numbers and the infinite anonymous interactions between people. Sowell promises at the beginning that he will relate these concepts to you without resorting to numbers, graphs, charts or math. He's pretty true to his word on that count. Instead, he uses everyday examples that involve things that most of us do without giving them much thought.

He establishes his mantra...more This book is a decent introduction to the alien concepts of the other half of the population who see everything in dollar amounts, numbers and the infinite anonymous interactions between people. Sowell promises at the beginning that he will relate these concepts to you without resorting to numbers, graphs, charts or math. He's pretty true to his word on that count. Instead, he uses everyday examples that involve things that most of us do without giving them much thought.

He establishes his mantra early on saying that an economy is the management of scarce resources that have alternative uses. This phrase is repeated throughout the book probably 75 times. The main point behind it is that the value of a resource varies depending on how scarce it is, what else it can be used for, and where the demand for the various uses is the greatest. While all of this seems pretty elementary, it's the examples in the book that illustrate the point in various ways that most of us never think about.

Those are the positive points of the book. I would also say that the more beneficial information is probably in the first 3/4 of the book because sadly and contrary to his own advice, the end of the book becomes quite political. He takes great care earlier in the book to keep politics out of his explanations, but as he approaches the end he attempts to synthesize everything that he has imparted to you into an attempt to convince you that his libertarian free-market capitalist views are free of the taint of politics that "the left", "liberals" or "intellectuals" seem to have a monopoly on.

I was disappointed that he squandered the opportunity to enlighten those of us who have little interest in economics as to it's true importance in daily life on the parting cheap shots against other institutions that have as much validity as private industry to be a part of our society. I am thankful that he at least kept this portion of his book at the end since I found the earlier chapters to be quite interesting and eye opening. But his attempt at political persuasion failed to move me as I have a natural and equal distrust of politicians, government and private industry.

If you're more to the left, you'll want to read this book guardedly, especially near the end. The book has value especially for lefties because it does make one aware of the importance of economics and raises awareness of how it really does affect you every day no matter if you want it to or not.(less)

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Mar 29, 2013 Kirk Battle rated it 4 of 5 stars

the book is an interesting education in capitalist ideology and neo-liberalism. I kinda enjoy it just because so many of my conservative friends make sense now. Sowell essentially argues that the free market is the superior mechanism for operating a country because individual consumers, by communicating with their wallets, are very good at making decisions that a centrally run organization cannot. He talks a lot about why communism doesn't work. Which is interesting.

Sowell's argument is that pr...more the book is an interesting education in capitalist ideology and neo-liberalism. I kinda enjoy it just because so many of my conservative friends make sense now. Sowell essentially argues that the free market is the superior mechanism for operating a country because individual consumers, by communicating with their wallets, are very good at making decisions that a centrally run organization cannot. He talks a lot about why communism doesn't work. Which is interesting.

Sowell's argument is that prices and value always find each other. So, for minimum wage, people just employ immigrant labor that they can pay less or ditch the job entirely. His point is that poor people, who desperately need ANY sort of job, are having a lot of unskilled labor options taken away because the government has priced them out.

This is prime Reagan era economics. I don't agree with everything here. It is an ideology and one that is very unrealistic at times. But when he's explaining how Unions killed the auto industry or why the Japanese were able to surpass them, that's real. Price controls of food is another topic he goes on about for ages or the hazards of government medical care

Some favorite quotes:

"The overwhelming complexity of economic repercussions throughout an economy is rendered manageable when millions of people each deal with only a relatively small number of transactions and leave the coordination of the whole economy to the fluctuations of prices."

"A price-coordinated economy facilitates incremental substitution, but political decision-making tends toward categorical priorities – that is, declaring one thing absolutely more important than another and creating laws and policies accordingly."

"The difference between the limited knowledge of a business executive and the similarly limited knowledge of a government official is that the business executive is receiving instructions from others via the marketplace on what to do – whom to supply, and when, with what kinds of fuel, in this case – while the government official is giving instructions to others and compelling them to obey."

That's the gist of it. He devotes large sections of time to explaining why minimum wage, monopolies, capital cushioning, and other policies don't work. The race tension throughout the book is interesting, he argues that minimum wage laws hurt black people extensively and argues they forced them into grey markets. His take on the hiring practices of women is equally unflattering, pointing out that if women were paid 75% less for the same work then the market would dictate everyone hired women all the time since you could get that much more labor for your money.(less)

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Jan 06, 2013 Nathan Edward rated it 2 of 5 stars

Despite the title, this is not a popular introduction to economics, but instead an often rambling screed against government intervention in markets. While price floors/ceilings are discussed extensively (over and over and over again, in chapter after chapter), topics like information asymmetries and externalities are only touched on briefly. If you want to peer into the mind of a Hoover Institute free-market fundamentalist, here's your chance.

The book shows no sign of having passed through an e...more

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Nov 01, 2012 Josh Meares rated it 3 of 5 stars · review of another edition

Thomas Sowell's book is a good introduction to economics in many ways. He consistently reinforces key ideas, like the idea that all goods are scarce and have alternatives, or that costs and prices are different, or that consequences and intentions are unrelated, or that politicians and economists work in different time frames. There is a lot of good information in here about economics. I would even go so far as to say that this book should be required reading for all high schoolers. Maybe they s...more

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Jim Most of us understand that free trade does not include those products or services that society find morally repugnant and institutes a prohibition on...more
May 22, 2013 05:08am

Josh Meares Jim wrote: "Most of us understand that free trade does not include those products or services that society find morally repugnant and institutes a pro...more Jim wrote: "Most of us understand that free trade does not include those products or services that society find morally repugnant and institutes a prohibition on them, including slavery, murder for higher, ill..."

I'm not saying that he is consciously pro-slavery, I'm saying his economics are pro-slavery. I'm sorry you take my argument as a personal attack. Let me structure it a little more formally. It's not a political point as much as a philosophical one.

One of the central themes of Sowell's book is that human (and therefore) market freedom results in the greatest good. Each chapter ends with an anecdote showing how minimizing or removing government intervention increases the public good. These are facts, not arguments, correct?

Another fact about Sowell's book is that he repeatedly puts the word "needs" in quotations mark, directly stating that needs are not really needs, and generally refers to wants. Again fact, not interpretation.

A final fact, before we get on to my ad hominem argument, is that Sowell directly argues against a minimum wage using the argument that supply and demand require that fair wages be paid or else laborers will not choose to work.

I would like to begin my argument using Sowell's own premises. Here we can either agree or disagree. My argument is essentially that these three points of Sowell's work fairly well in America because Americans are already rich and have a relatively strong social safety net.

This is demonstrably NOT the case in the developing world, such as my current country of residence, Indonesia. People don't die of starvation because they "wanted" food, they died because they needed it (no quotations).

Now, the easiest disproof that there is no need for a minimum wage law (and also that human freedom does not equal good) is the modern slavery movement. This is not a personal attack, as you would have it, it is the simplest possible counter-example to Sowell's incredibly often repeated refrain "government intervention is evil". Modern slavery exists, there are more slaves now than at any time in history, and it is an incredibly lucrative business. Supply and demand are actually the driving forces behind slavery. In this case in particular, "government intervention" is both necessary and helpful.

Therefore, my use of the slavery movement (while technically not Politically Correct because of the ethnicity of the author) is not a personal attack, but a clear and obvious case study rebutting a central premise of his book.(less)
May 22, 2013 07:01am

Mar 30, 2012 Johnrh rated it 4 of 5 stars

It is a long book (550+ pages) but very simply explained, which worked for me. It is well worth reading, so if you’re as inattentive as I am, just pace yourself and take your time.

Both BASIC ECONOMICS and Hazlitt’s ECONOMICS IN ONE LESSON are as simple and logical as one could ever hope for. After a few chapters of BASIC I thought I was reading the expanded version of the very short ONE LESSON.

Hazlitt’s lesson:

Chp. 1: THE ONE LESSON: “From this aspect, therefore, the whole of economics can be...more

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Mar 23, 2012 Jerry rated it 5 of 5 stars · review of another edition

Shelves: economics

Wisdom, common sense and brilliance have remade the dismal science. No wonder this book has been translated into six languages (so far). I listened to it on CD, twenty something discs in the car over a few months, courtesy of the library. The sections were short and the prose clear enough to do this without losing the flow. It was so helpful and comprehensive that I got the book to read and reference.

As much as I enjoy learning about economics, I've been purposely working through a pile of book...more

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Mar 12, 2012 Keenan rated it 3 of 5 stars · review of another edition

It was a good read, I must say, although this by no means signifies that I agreed with half the information passed off as fact by Sowell. There are lots of areas that he brings light to, and yet there are also lots of nooks and crannies where he refuses to flash his bulb of Economic insight. And, somewhere in the middle is a strange mix of Economic opinion--- a realm beyond fact or fiction, yet according to Sowell it is indeed fact. Here is a taste of what I've been thinking about:

Mr. Sowell's...more It was a good read, I must say, although this by no means signifies that I agreed with half the information passed off as fact by Sowell. There are lots of areas that he brings light to, and yet there are also lots of nooks and crannies where he refuses to flash his bulb of Economic insight. And, somewhere in the middle is a strange mix of Economic opinion--- a realm beyond fact or fiction, yet according to Sowell it is indeed fact. Here is a taste of what I've been thinking about:

Mr. Sowell's book Basic Economics does achieve the goal of familiarizing the layperson with some of the intricacies of the economic field. However, his view comes very much from the right, and it is quite clear that his belief that an economic system that is free to do whatever is best for itself, is going to be what is best for those citizens who live in the context of that nation. In on other words, rules, regulations, taxes, and Sowell's favorite term "red tape", just serve to get in the way of capitalism's divine plan, thus making everything in the process less efficient leading to quality deterioration, long queues, and ultimately a lower standard of living for the citizens within that economy.

I agree with many of his precisely selected examples that he brings us of the former Soviet Union, and when comparing the quality of life in the U.S. with the quality of life that existed in the Soviet Union it is obvious that we agree with Sowell. Throughout the book Sowell enlightens us as to how fortunate we really are to have free enterprise, compared with other countries in the world that have less free enterprise. Yet at the end of the book, Sowell leaves me unconvinced about my status as a citizen in the country with the freest enterprise in the world--- something that should strike the reader as terrific by the end of Sowell's statement.

I see that Sowell simply glosses over some of the main problems with American Capitalism, or doesn't mention them at all. Aside from the extravagant cost of healthcare and education, the widest gap between rich and poor in any nation, the extreme amount of debt of an average American citizen, and some of the longest working hours per worker per year leaving the least amount of time for family, friends, or leisure--- the fundamental problem that I see with American capitalism is the purchasing of political power by those with extravagant wealth, and in effect the deterioration of a democratic state. No matter how well the markets work, and how efficient they are, even if they were to give every citizen a superior standard of living, the bottom line is that wealth purchases political power and that is the number one threat to our democratic system.

I feel that Sowell has written a book explaining why things are the way they are, and that is a very valuable thing. We have to know the present paradigm to know how it works, so that we can correct it. Now, I would like to read a book by an economist who doesn't just explain why we have the system that we have, but who can also offer professional suggestions to improve the current system, or to change the current system. In his book, Sowell seems to act like everything has been tried before, and that it is impossible to find a better system than the system that we have. I don't even think Sowell believes that the system that we have is flawed at all, as a matter of fact, and for me this is a red flag to be wary of what Sowell says.

One last thing, about quality of life and standards of living.

Sowell states:

"Efficiency in production--- the rate at which inputs are turned into output.... affects the life of whole societies." (p.6)

He goes on to add that essentially the more efficient a society is in production, the higher the standard of living will be created for the people within that society. But, does a higher standard of living in terms of material goods and services, mean an overall higher standard of living when considering social capital? Shouldn't we also include social stability when talking about high standards of living and quality of life?

In other words, if efficiency in production is the rule, businesses are going to make sure to always do their best to produce things faster, cheaper, better, etc.. despite whatever effect this may have on its employees who bear the consequences of these changes. The labor force is constantly threatened with becoming obsolete by their employer, and they live with the threat that they can be fired from their jobs at any moment the instant the market dictates a decline in their field of work and a growth in another field, or a more efficient technology that replaces them altogether. Does this create a stable and healthy society--- to have a society of workers (who are also consumers, by the way) who can lose their job at any moment, as soon as they are no longer profitable, or as soon as the market dictates a different need? What effect on the mental health of Americans has this system had on the people who live there? What is the effect on mental health of so much competition?
Are Americans pushed beyond their limits with free enterprise competition, while having no public healthcare system, and having no comfort, safety, or stability in the security of their jobs, at the same time being overworked and sacrificing family, friends, and leisure--- to the point that everything is so chaotic for them that why shouldn't they go to the extreme when the day comes that they become economically useless to their employer?

I believe that Americans are such extreme people because they live under such extreme pressures and circumstances. Extreme wealth and poverty abound, and so does extreme dedication to work above all else. I don't think this makes for a very stable society for anyone, forget standard of living. Standard of living doesn't matter when average citizens are reacting in violent and undesirable ways to a system that forces them to constantly compete with one another at the expense of everything else in their lives--- especially in a place where social services are almost nowhere to be found. (less)

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Jul 26, 2011 Justin Larson rated it 1 of 5 stars · review of another edition

I picked up this book hoping to extend the economics education i got in college. What I got instead was an ideologically charged diatribe of the government and a love-fest of the free market.

Everything is backed up with anecdotal evidence and sweeping statements made with much hand waving. It sells itself on the fact that it has no "equations, graphs [or] jargon," but I find that to be a weakness. While it doesn't need be filled with graphs and such, some proofs would be nice. Instead he simply...more

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May 20, 2011 Bojan Tunguz rated it 5 of 5 stars · review of another edition

Economics is at the same time a fascinating and rather complex subject. It is fascinating since it touches on so many aspects of our lives, and it is complex due to the highly technical analysis that is oftentimes required to be mastered in order for Economics to be fully appreciated. This technical complexity oftentimes obscures rather simple principles that underlie most economic phenomena. The well known relationship between a supply and demand is one of those, and a good example of a simple...more

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Feb 10, 2011 John Brown rated it 4 of 5 stars

4.5 stars. Karl Marx was not a scientist. Nor was Adam Smith before him. They were philosophers. Theorists. Idea men. That’s what all economists in those days were. They had little tested knowledge, and so which economic system was best was all a matter of opinion.

But things are now much different. Nations and local governments tried the various theories. And we’ve seen the results. We now have a whole century of data. Furthermore, economists now are scientists. They use scientific methods and d...more 4.5 stars. Karl Marx was not a scientist. Nor was Adam Smith before him. They were philosophers. Theorists. Idea men. That’s what all economists in those days were. They had little tested knowledge, and so which economic system was best was all a matter of opinion.

But things are now much different. Nations and local governments tried the various theories. And we’ve seen the results. We now have a whole century of data. Furthermore, economists now are scientists. They use scientific methods and deal with tested knowledge. Sure, there are still controversies, just as there are in any science, but the basic principles of economics today are NOT matters of opinion.

For example, we know what happens when governments impose price controls in all their many varieties—rent caps, minimum wages, laws against price gouging, and medical care cost limits. These last few years we’ve seen a dramatic demonstration of what happens when they meddle with the prices of home loans. We know what happens when they impose tariffs or give subsidies to special groups like farmers or steel producers. We know what happens when they create barriers to people entering a market to compete, like they’ve done with immigrants. We know what taxes do.

The unfortunate thing is that many of these principles seem to be ignored by our politicians. And by those who vote them in. And so we can have a Congress pass massive health care legislation that will cause health care shortages just as similar laws caused shortages in other countries. This is how we have a president who in a recent speech to the U.S. Chamber of Commerce suggested, in good Marxist fashion, that it was business owners who kept the American workers down by hoarding all the profits. Has he not looked at the data which shows that huge profits invite more competition, which tries to get ahead of the leader by cutting prices, which allows the American workers to get more for less, thus raising their standard of living?

In the 1980′s and 1990′s India and China began to make fundamental changes to their economic policies, doing the things that have been proven to work. Suddenly, the economies of those nations started to grow. It’s estimated that 20 million people in India rose out of poverty in a decade. In China, more than a million people rose out of poverty EACH MONTH.

But this seems lost on a number of politicians. Don’t let it be lost on you. We have critical elections coming up. One of the best things we can do is educate ourselves about these basic economic principles so we can cut through all the political blarney. I haven’t found a better, more enjoyable book on the subject than Basic Economic Principles: A Common Sense Guide to the Economy by Thomas Sowell. Sowell is an economist and Senior Fellow on Public Policy at the Hoover Institution at Stanford University. His book is written for the general public and so foregoes dry charts and lots of theoretical ho-hum for lots of real-life examples and straight-forward explanations. There are times when I wish he would have gone into more detail on a few subjects, but what he lacks in depth in a handful of areas, he makes up with breadth. Furthermore, the way he presents the topic was interesting enough to make me stay up late a number of nights well past my bedtime.(less)

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Nov 25, 2010 Jesse Schexnayder rated it 5 of 5 stars

Shelves: audiobook

Thomas Sowell exposes the fallacies and outright lies the American people have been subjected to in the advancement of progressive entitlement centric economic programs by the modern crop of corrupt politicians. If you take anything from this book, it should be this: The intended goals of any type of economic aid can never be considered separately from the actual economic incentives the policies implemented to ostensibly reach that goal will create, without causing more destruction and more harm...more

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Mar 02, 2010 Stephen rated it 5 of 5 stars

I listened to the audio version of this book while commuting to and from work. My biggest complaint is that my commute is not long enough. For a subject that I expected to be very dry, Mr Sowell did an excellent job in keeping my attention. It was a relief to hear clarification of many thoughts that I have had in the past. A big one is the whole rent control thing in NYC. I saw this first-hand, never knew anyone of low income to benefit from it, and always felt that it accomplished the exact opp...more

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Apr 21, 2012 James rated it 5 of 5 stars

Basic Economics is the authoritative text to gain a baseline understanding of the way economic systems work. It is an especially important written work given the context of the looming election season since the Democrats and the Republicans espouse different visions of the economic role of the federal government. The book covers such subjects as: tariffs, outsourcing, subsidies, socialized medicine, international trade, free markets versus command economies, the role of government in economic s...more

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Feb 23, 2011 Kelly rated it 5 of 5 stars

I wanted a clearer version of the Econ 101 I muddled through in college, and I admired Sowell's work, so I started reading this book. Then I found out it's not about M1 and M2 and how the Fed works. Rather, it's about really meaningful economics -- the kind every adult should understand.

To a large extent, Sowell was preaching to the choir with me. I already understood why rent control is bad and how the minimum wage contributes to unemployment. I knew that cuts in the tax rate tend to increase -...more

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Mar 11, 2009 Bernie rated it 5 of 5 stars

A must-read for any intelligent voter. Sowell clearly explains why the market system is the most efficient method of allocating goods in a world where resources are scarce..... and the negative,and sometimes unintended effects of other methods.

One of my favorite quotes was... "Careful and complex mathematical calculations can make the difference between having an astronaut who is returning to earth crashing in the Himalayas or landing safely in Florida. We have also seen similar social disaster...more

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Aug 17, 2012 Bruce Reiter rated it 4 of 5 stars

Okay. I agree to disagree. This is a great book for folks who don't like graphs. The author discusses economics by narrative. Much of the information appears anecdotal but the author provides information about sources for each of the chapters at the end. Economics is a system. It has no moral nor social axe to grind. Don't blame the free market system, blame the people who operate within it and screw it up by not allowing it to be a free market. Libertarian in outlook and certain to raise the ha...more

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Apr 18, 2013 Jesse Rine rated it 5 of 5 stars

One of maybe five books that everyone should have to read. Read it not only for a foundational understanding of the economic realities that impact our daily lives in countless ways, but also as a tutorial in critical, logical reasoning. Sowell's constant use of real world examples makes the book incredibly relevant to modern problems, as well as providing short history lessons that are just as valuable.

Sowell's discussion of incentives is vital for understanding our economic and political syste...more

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Jan 31, 2013 Henrik Bidstrup rated it 5 of 5 stars

What a life changing book!

This book contains enough knowledge, for an entry-level insight into economics. It is extremely well written, easy to understand and explains just about everything you need to know. It repeats itself slightly but only on major issues, so it has it's fact and point hammered in. It doesn't take side to any kind of political dogma, neither does it belittle the thinking and ideas behind the socialist economies of the former Soviet Union. In the first part of the book, it ev...more

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May 10, 2011 Hadrian rated it 3 of 5 stars · review of another edition

Shelves: economics-finance-business, nonfiction

Excellent overview of modern economics for the lay person. Covers a wide variety of topics simply and easily. Economics is still a very 'fuzzy' field, especially in comparison to other sciences, and many people profess ignorance of large swaths of it. This books helps, although it is necessary to understand both the free-market stance and the relative lack of terminology.

Be warned - if you are not a supporter of free-market economics, you will disagree with much in this book, as the author ascri...more

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Aug 15, 2009 Johnny Rags rated it 4 of 5 stars

Thomas Sowell consummately translates complex economic principles into the language of the common man. The subtitle indicates that this book is a "citizen's guide"; society would benefit tremendously if each citizen were to familiarize himself with the principles that Dr. Sowell addresses.

"For those who are willing to stop and think, basic economics provides the tools for evaluating policies and proposals in terms of logical implications and empirical evidence."--This is the end which the book...more

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Sep 21, 2012 Chris rated it 5 of 5 stars

Excellent, no-nonsense, comprehensive treatise on basic economics from the perspective of the Chicago School. Sowell does a nice job of describing the basic principles of the allocation of scarce resources, which have alternative uses (AKA economics). He goes into detail on the misconceptions and logical errors leading to many incorrect yet widely-held beliefs about economics, which often have profound influence on actual government policies and therefore real negative consequences for people. E...more

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Dec 03, 2008 Bertpass rated it 4 of 5 stars · review of another edition Recommends it for: Any student before they enter college

Shelves: classics, business-econ

This should be required reading for students or anyone wishing to understand the way economics works in a free society. In very plain language, Mr. Sowell lays out the way incentives work in free societies to meet the ultimate needs of humanity. He mainly describes the way scarce resources are distributed in the best way possible...by using pricing mechanisms and profits as enabled by a free market. He also spends quite a bit of time describing the reasons centrally planned economies are impossi...more

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About Thomas Sowell

Thomas Sowell is an American economist, social commentator, and author of dozens of books. He often writes from an economically laissez-faire perspective. He is currently a senior fellow of the Hoover Institution at Stanford University. In 1990, he won the Francis Boyer Award, presented by the American Enterprise Institute. In 2002 he was awarded the National Humanities Medal for prolific scholars...more Thomas Sowell is an American economist, social commentator, and author of dozens of books. He often writes from an economically laissez-faire perspective. He is currently a senior fellow of the Hoover Institution at Stanford University. In 1990, he won the Francis Boyer Award, presented by the American Enterprise Institute. In 2002 he was awarded the National Humanities Medal for prolific scholarship melding history, economics, and political science.

Sowell was born in North Carolina, where, he recounted in his autobiography, A Personal Odyssey, his encounters with Caucasians were so limited he didn't believe that "yellow" was a hair color. He moved to Harlem, New York City with his mother's sister (whom he believed was his mother); his father had died before he was born. Sowell went to Stuyvesant High School, but dropped out at 17 because of financial difficulties and a deteriorating home environment. He worked at various jobs to support himself, including in a machine shop and as a delivery man for Western Union. He applied to enter the Civil Service and was eventually accepted, moving to Washington DC. He was drafted in 1951, during the Korean War, and assigned to the US Marine Corps. Due to prior experience in photography, he worked in a photography unit.

After his discharge, Sowell passed the GED examination and enrolled at Howard University. He transfered to Harvard University, where he graduated magna cum laude with a Bachelor of Arts degree in Economics. He received a Master of Arts in Economics from Columbia University, and a Doctor of Philosophy in Economics from the University of Chicago. Sowell initially chose Columbia University because he wanted to study under George Stigler. After arriving at Columbia and learning that Stigler had moved to Chicago, he followed him there.

Sowell has taught Economics at Howard University, Cornell University, Brandeis University, and UCLA. Since 1980 he has been a Senior Fellow of the Hoover Institution at Stanford University, where he holds a fellowship named after Rose and Milton Friedman.

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Books by Thomas Sowell

The Vision of the Anointed: Self-Congratulation as a Basis for Social Policy

Applied Economics: Thinking Beyond Stage One

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“Economics is a study of cause-and-effect relationships in an economy. It's purpose is to discern the consequences of various ways of allocating resources which have alternative uses. It has nothing to say about philosophy or values, anymore than it has to say about music or literature.” — 11 people liked it

“Unfortunately, the real minimum wage is always zero, regardless of the laws, and that is the wage that many workers receive in the wake of the creation or escalation of a government-mandated minimum wage, because they lose their jobs or fail to find jobs when they enter the labor force. Making it illegal to pay less than a given amount does not make a worker’s productivity worth that amount—and, if it is not, that worker is unlikely to be employed.” — 6 people liked it

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Basic Economics: A Citizen's Guide to the Economy

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