Summer reading: Four leading UK economists offer their book recommendations
With its political and economic ructions, this summer has been anything but sleepy. If you’re looking for some holiday reading to prepare you for the year ahead, City PM has asked four of the UK’s leading economists to offer their recommendations.
Tim Harford writes the Undercover Economist column for the FT and is presenter of More or Less on Radio 4. His new book, Messy: How to be creative and resilient in a tidy-minded world, is published by Little Brown in October.
Thinking Strategically, by Avinash Dixit and Barry Nalebuff
It’s the book that first attracted me to economics and one that I find myself recommending over and over again.
Thinking Strategically is a guide to using game theory to succeed in business and in life. And what is game theory? Game theory was devised by the economist Oskar Morgenstern and John von Neumann, one of the great mathematical geniuses of the twentieth century.
It’s a way of thinking through problems where you are competing or cooperating with others: how should Andy Murray decide whether to serve to the backhand or forehand? Where should you try to rendezvous in New York if you’ve lost your friend and your phone is out of battery? When faced with a competitor, should you raise your prices or lower them?
Dixit and Nalebuff produced a fun and fascinating guide to a fun and fascinating topic.
Duncan Weldon is head of research at Resolution Group and former Newsnight economics correspondent.
Global Inequality: A New Approach for the Age of Globalisation, by Branko Milanovic
Branko Milanovic is the economist of the moment. Four years ago he published a chart of global income growth by percentile of the world population from 1988 to 2008. It showed that from the end of the Cold War until the financial crisis, income growth was especially strong for the global middle class (workers in China and India) and the top 1 per cent of global earners – the richer people in the advanced economies.
Only two groups missed out – those at the very bottom of the world income distribution in countries not yet plugged into the global economy and low to middle income earners in the advanced economies, who have seen much weaker income growth.
These findings are now being used to explain everything from Trump to Brexit, making his new book a must-read for anyone interested in global politics or economics. And while it seems like a stretch, this book does help to explain the recent backlash against globalisation in the west. At 350 pages, it is written to be read rather than sit on a shelf. Highly recommended.
Vicky Pryce is chief economic adviser at CEBR and a former joint head of the UK Government Economic Service. Her book, It’s the Economy Stupid: Economics for Voters, written with Andy Ross and Peter Urwin, was published by Biteback Publishing in 2015.
Phishing for Phools: The Economics of Manipulation and Deception by George Akerlof and Robert Shiller
I was sent this book to review and fell in love with it. Don’t be put off by the word economics in the title. It is short, easy to read, and great fun.
First used in 1996, “phishing” entered the Oxford English Dictionary in 2005. It is defined as: “to perpetuate a fraud on the internet in order to glean personal information from individuals, especially by impersonating a reputable company; to engage in online fraud by deceptively angling for personal information.”
We have all received unsolicited cries for help from friends supposedly stranded in a remote city urging us to transfer money to see them through. But these Nobel prize winning authors take this even further, to define phishing as “getting people to do things that are in the interest of the phisherman, not the target”.
We all get caught at some point. People are manipulated to buy what they think they want, rather than what they really want, through a mix of clever psychological ploys, often being supplied with misleading or erroneous information. Bad government phishes as well, and lies to get your vote.
We are the fools. Be disturbed, be very disturbed.
Andrew Sentance CBE is senior economic adviser at PwC and former member of the Bank of England's Monetary Policy Committee.
Seasons in the Sun: The Battle for Britain 1974-79, by Dominic Sandbrook
The political and economic uncertainty we are seeing now is reminiscent of the mid-1970s, albeit not on such an extreme scale. The 1970s were the most turbulent period for the UK since the Second World War, with many mistakes of political judgement and economic policy. Let us hope we don’t descend into the same degree of turmoil as a result of the Brexit vote, but Dominic Sandbrook’s book is an excellent reminder of how turbulent the mid to late 1970s were, and it formed the basis of an excellent BBC series on the seventies a few years ago.