Saturday, July 16, 2016
The best book about everything
Following the advice of Jordi Brandts, I have been reading with great pleasure the book "The Good, the Bad, and the Economy," published in 2012 by economist Louis Putterman. It's difficult to say what this book is about because it is about so many things. It includes a history of life in our planet, with a special emphasis on the human species. On this, an endnote to one of the chapters includes this amazing link to the journey of humanity from its origins in Africa to the colonization of most of the Planet. It also includes a history of economic thought, from Adam Smith and before, to evolutionary, experimental and behavioral economics. Demanding readers will perhaps miss a few schools of thought, such as the economics of transaction costs pioneered by Ronald Coase, but the author is probably entitled to emphasize those topics that he knows best in such a synthesis of pretty much everything. Putterman has two important messages for the reader. The first is that humans are guided both by self-interest and by altruistic values, and that both are the result of the selection forces of evolution. The second is that the differences in development patterns in our world are the result of the slow forces of evolution. In history, there is a lot of continuity and path dependence. The fact that what today we call developed countries are richer than other parts of the world has its roots in advantages that started to materialize millenia ago, because of mainly geographical reasons similar to those explained by Jared Diamond in his books. Of course, progress towards a more equitable development will depend on tapping on the altruistic resources of humanity at the same time as using our self-interest to devise new technologies and ways of producing which allow us to overcome many of our social problems.