Good Economics for Hard Times: Better Answers to Our Biggest Problems
In this revolutionary book, prize-winning economists Abhijit V. Banerjee and Esther Duflo show how economics, when done right, can help us solve the thorniest social and political problems of our day. From immigration to inequality, slowing growth to accelerating climate change, we have the resources to address the challenges we face but we are so often blinded by...more
The book is well written and researched. In fact, it is surprisingly easy to read and understand for a lay person. The authors take a global approach to the subject. What impressed me was the fact they actually did research and analyzed data to find out what worked or not. They examined the most crucial issues the world faces such as migration, trade wars, inequality and climate change. They said “the book’ ...more
The idea that economics commands the same level of precision as physics has led to the perpetuation of several misconceptions and dogmas. That the authors fully understand this is a testament to the book. The authors are not dogmatic, nor are ...more
- An influx of new workers will shift the demand curve right since the newcomers spend money and thus increase overall consumption. The influx increases the demand for labor and increases the supply of laborers. With the arrival of migrants, native low-skilled workers may engage in occupational upgrading: employers reorganize production to make effective use of the new workers.
The reason I docked a star ...more
(a southern rather than northern focus). They also coauthored “Poor Economics”, which also is well worth reading. They are highly unusual among the economists who gain the most traction in the US for multiple reasons: 1) they do experiments (RCTs), 2) they are interested in how theory and practice fit together, ...more
Kai Fu-Lee's AI Superpowers has a better last chapter on a similar topic than this book's last chapter. So mix and match?
Authors present the common ideological claims we’ve internalized and show how we ...more
I particularly liked the chapter on immigration, aka why it doesn't happen remotely as much as people worry that ...more
- Dispelling false beliefs about immigration, and showing why the classic supply-demand theory doesn’t apply to immigration
2. Trade & Tariffs
- Explaining how trade works, and how comparative advantage means countries should do what they are relatively best at doing
One of the key theses the authors argue for is that people don't move very much (if they can stay where they are) even if it is in their economic interest to do so. A lot go into settling in another city and unless people are absolutely forced due to war, violence or other such extreme conditions, people just don't migrate a lot. For instance, the authors write:
It is not only in developing countries that people do not ...more
Esther and Abhijit are couples. They are also the 2019 winners of the Nobel Prize in Economics. In their previous book, Poor Economics, the duo set new outlines for fighting global poverty and help developing countries improve everything from school enrollment to immunisation rates. This current book examines the current global challenges with a broad analysis of available economic research. The authors methodically proffered humane and unambiguous solutions to these crucial problems humanity ...more
Duflo and Banerjee were lucky enough to release this book right as they won the 2019 Nobel prize for economics, which they are well deserving of because they are brilliant. I’ve read many ...more
Fueled by the logic of Randomized Control Trials, Banerjee and Duflo have collected a series of irrevocable scientific evidence contradicting the vast majority of the accepted truths of current political discourse, picking apart the nuances of the ACTUAL truths and prescribing feasible policy to rectify our must burning issues.
Here are just a few of the cornerstone of common sense economic thought taught in most Econ 101 classes that they debunk:
They take on the big issues - trade, immigration, poverty - and come to conclusions based on the available data that often contradict conventional wisdom. As an example, they highlight why trade has both winners and losers, and while in aggregate the ...more
Straightforward, insightful, compelling and instructive, the discussion generates quite a few “light bulb going on” moments. In today’s tortured debate about immigration, for example, the extension of the concept of “stickiness” to the movement of our fellow world citizens (it takes a lot to ...more
|MIT Alumni Book Club: Winter 2020: Good Economics for Hard Times (Selected by Mary Ann Bates)||7||30||Jan 15, 2020 10:20PM|