Customer Reviews

The Best Book on the Market: How to stop worrying and love the free economy

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This is a fantastic explanation of how markets really work and why they're so important to our everyday lives. The book's economics are spot on, but this doesn't feel like an economics book. It's a very easy read, for one thing. The author uses fascinating, real-life examples to explain his points without lapsing into technical jargon. People tend think of markets as cold and impersonal - something that 'compassionate' governments need to take control of - but this book shows how markets are actually a fundamental part of human life and work to benefit us all. The author makes some pretty important points, then, but somehow he manages to keep the book fun and amusing at the same time. Highly recommended.

Eamonn Butler, Director of the Adam Smith Institute, has a wonderful ability to express the fundamentals of economics and exchange in ways that lay readers can understand and enjoy - and empathise. This ability combines with an essential technique - to start at the beginning! The path from a single deal between two consenting people (possibly in different countries) to large-scale free enterprise, is a simple continuum. Requiring only the freedom to associate, at every point participants are free to exchange - or not - and the choice may or may not be made with regard to ancillary matters such as specialist advice and contracts. Thus Dr Butler starts with a visit to a street market in Lanzhou, China, and ends (or nearly ends) in discussing multi-national companies. On the way, he covers most of the important consequences of this freedom; for example specialisation and exchange, (to the point where exchange is the fundamental social relation) money, the informative role of prices, and capital accumulation.


Dr Butler is (among other things) a proper economist. By this I mean he has no time for the Keynesian macro-economics churned out by most universities; markets, and life itself, are never in equilibrium, so why build up a "science" on the assumption that they are? There is no Utopia; it's just that markets and freedom from governments are much nearer to it, adjusting constantly in their quests to do better. As he says, "the free-exchange system [markets] has an uncanny power to steer the right resources to the right place at the right time". "Unorganised order", he calls it. In contrast government is working in a vacuum; its operations are based on whims not price signals, and it torpedoes markets whenever it can (starting with money, where "governments manage to make paper completely worthless by printing pictures of dead presidents on it").


Dr Butler rightly castigates big government as the arch-enemy of markets, censoring them and their miraculous signals at every turn. Yet the failure of government projects is an endemic feature, while their perpetrators sing the "market failure" mantra at every opportunity - nowhere more loudly than on the environment, where as Dr Butler points out, markets don't exist.


He might have added "because they were nationalised". But elaborating on that takes time and space, whilst a major feature of this wonderful little book is that it is, well, little; you can read it in one sitting - although many readers will use it as a handy reference as well.


The book is similarly succinct in addressing government regulation of business. Often deliberately sought as a means of protection from competition, this practice is rife and provides government with a scapegoat when things go wrong. (A thorough nailing of this issue and its true causes is long overdue.)


Dr Butler has touched on scores of other matters which are best dealt with by markets not governments - the benefits of competition, prices as messengers, transaction costs, externalities, (where tax itself remains the supreme externality) patents, licences, entrepreneurs (as opposed to "experts") the crucial role of property, and the essential morality of free markets. (Enforced behaviour has no moral component, of course, and in any case charities are within the free market rather than outside it.)


Definitely the best book on the market that's on the market!

I think Dr Butler has penned an excellent, succinct and effective introduction to the case for liberal, free markets. It is particularly effective for anyone who has not encountered these arguments before, because it is fair, jargon-free and resists the temptation to ram home the ideologial message too hard.

It covers all the main bases well. If I have a tiny quibble, I would argue that on complex issues such as patents, copyright and limited liability companies, it might have been useful to explain that even among ardent free marketeers, there is a lot of debate on whether, for example, patents are either justified or right.

But that is a minor point. This book ranks alongside such works as Basic Economics by Tom Sowell, Free To Choose by Milton Friedman and Economics In One Lesson by Henry Hazlitt as a superb introduction to the field. It can be read easily in an hour or so. It should be on the reading list of young students interested in business and might help to counter a lot of lazy, statist thinking.

I haven't finished this book yet, but for me it actually IS "the best book on the market." I am no economist, but I have read Sowell's "Basic Economics, and Hazlitt, as well as large helpings of Ludwig von Mises and Hayek. All of these people wrote excellent books, but this particular minor classic rises to the status of a classic because of the author's very dry sense of humor, and also because of his excellent use of comparisons.

These things are not what comes "easily," or "naturally." My favorite comparison (so far) is with the old-fashioned cars which actually had a temperature gauge rising from the engine so you could tell when the engine was overheating. A dissatisfied customer complained that his gauge always read "hot." The author's father "fixed" the problem by soldering some gears in the gauge together, so that it would always read "normal."

Bad fix -- worse than a kluge. What happens when the engine actually boils over?

This "bad fix" is compared to ALL government attempts to regulate prices. They ALWAYS fail and they are ALWAYS a bad idea. It's just like soldering the gears together.

As one of a billion examples, during the recent tsunami in Thailand, the then Prime Minister came out with a bold speech promising to punish those who were "profiteering" from the catastrophe, and fixing all prices in the area of the tsunami. Could anybody think of a surer way to ensure starvation in that area? Of course, this being Thailand, it is highly probable that everyone overlooked the Big Speech.

I also particularly enjoyed the author's selection of Princess Diana's death as an illustration of the efficiency of the price system. The price of flowers in London went through the roof, and this information instantly reached flower wholesalers on the Continent, and shortly reached Kenya -- which instantly began to send more flowers to satisfy the overwhelming demand. As the author points out, in a centrally-planned economy, it would have taken at least a week for the current report on the "Flower Situation" to hit the desk of the appropriate minister, and at least a month for the Ministry of Flowers to do anything about it.

A classic book! (And I don't say that lightly.)

I just read Dr Butler's book and the title is accurate. It is a 2 hour read that doesn't even seem like you're reading an economics text. It has well distilled insights into how markets work and why they are a good thing, and these are couched in colourful examples from Butler's real life experience. I highly recommend this book to anyone who would like to appreciate the market in a way that much more laborious treatments fail to do.

Witty and gripping. Butler's penetrating gaze includes fair trade, black markets, and equity. He believes that when markets are allowed to work without government interference but within the framework of just laws they can create "a richer, freer and more peaceful world".

I wish this book had been available when I was younger. Someone should buy a copy for every high school senior and university student in the country... and every politician obviously! This is not just a book for people with a special interest in economics. It really is for everyone. Essential reading.

The author has the special - and rare - ability to make challenging ideas accessible, friendly, and fun. The perfect introduction, and a valuable refresher for the more expert reader. We are all in Dr. Butler's debt.

Professor John Spiers, University of Glamorgan.

This is a brilliant book. Its ingenuinity lies in taking a set of complex economic arguments and simply explaining how their application transforms our everyday lives. Anecdotal, lucid ,comprehensible and witty, this is required reading... not for ideologues or theorists, but for absolutely everyone.

I loved this book. For someone who wants to understand the fundamentals of market thinking, this cannot be beaten. It is really easy to read and understand, but does not attempt to "dumb down" in terms of analysis. I have given copies to my children at University, and they rave about it too!