The Clash of Economic Ideas: The Great Policy Debates and Experiments of the Last Hundred Years [Hardcover]

Lawrence H. White (Author)

Book Description

Publication Date: April 16, 2012 | ISBN-10: 9781107012424 | ISBN-13: 978-1107012424 | Edition: 1

The Clash of Economic Ideas interweaves the economic history of the last hundred years with the history of economic doctrines to understand how contrasting economic ideas have originated and developed over time to take their present forms. It traces the connections running from historical events to debates among economists, and from the ideas of academic writers to major experiments in economic policy. The treatment offers fresh perspectives on laissez faire, socialism, and fascism; the Roaring Twenties, business cycle theories, and the Great Depression; Institutionalism and the New Deal; the Keynesian Revolution; and war, nationalization, and central planning. After 1945, the work explores the postwar revival of invisible-hand ideas; economic development and growth, with special attention to contrasting policies and thought in Germany and India; the gold standard, the interwar gold-exchange standard, the postwar Bretton Woods system, and the Great Inflation; public goods and public choice; free trade versus protectionism; and finally fiscal policy and public debt. The investigation analyzes the theories of Adam Smith and earlier writers on economics when those antecedents are useful for readers.

Editorial Reviews

Review

'Larry White provides a fascinating look at the debate among economists about the 'big ideas' of the twentieth century - a great read for all students of economics!' Douglas Irwin, Dartmouth College

'The Clash of Economic Ideas is one of those rare books that makes the history of economic thought an intellectual adventure while remaining highly relevant to the issues and controversies of the present day. I have already used parts of the book in manuscript form and found it to be an excellent teaching tool. It captures the student's imagination and opens new vistas for exploration.' Mario J. Rizzo, New York University

'This clear, crisp, and comprehensive account of the clash over the role of government in the economy during the last century is most welcome. By spinning his tale around the many richly colorful characters that drive the argument, Lawrence H. White has made the pivotal clash of economic views that continues to shape the political debate to this day both accessible and engaging.' Nicholas Wapshott, author of Keynes Hayek: The Clash that Defined Modern Economics

Book Description

The Clash of Economic Ideas explains what economists have been disagreeing about for the last hundred years. It covers disputes over the free market, socialism, fascism, the Great Depression, the New Deal, war, nationalization, central planning, economic growth, money and finance, inflation, regulation, free trade, government spending, budget deficits, and public debt. It puts the debates in historical context, and discusses how economic ideas have influenced swings in economic policy. It traces the ideas of modern economists back to their immediate and sometimes distant forerunners to understand the origins of today's debates.

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Product Details

• Hardcover: 440 pages
• Publisher: Cambridge University Press; 1 edition (April 16, 2012)
• Language: English
• ISBN-10: 9781107012424
• ISBN-13: 978-1107012424
• ASIN: 1107012422
• Product Dimensions: 6 x 1.1 x 9 inches
• Shipping Weight: 1.6 pounds (View shipping rates and policies)
• Average Customer Review: 4.7 out of 5 stars  See all reviews (9 customer reviews)
• Amazon Best Sellers Rank: #374,695 in Books (See Top 100 in Books)

More About the Author

I am a professor of economics at George Mason University in Fairfax, Virginia. My latest book, The Clash of Economic Ideas, combines my interests in economic history and the history of economic thought. My earlier books discuss the theory and history of banking and money. I have been teaching for about thirty years, including stints at New York University, the University of Georgia, and the University of Missouri - St. Louis, before moving to my current position in 2009. My wife is Neera K. Badhwar, a philosopher.

I enjoy giving talks about economic issues across the United States and around the world. In recent years I have been a regular speaker at the summer seminars of the American Institute for Economic Research and the Foundation for Economic Education. I am a co-editor of the online journal Econ Journal Watch, and I host bi-monthly podcasts for EJW Audio.

My GMU personal webpage is http://mason.gmu.edu/~lwhite11/biography.html. You can Google "Lawrence H. White" to find many videos of me giving talks and interviews.

Most Helpful Customer Reviews

25 of 27 people found the following review helpful

5.0 out of 5 stars A book just as relevant now as it was when the debates it discusses took place April 25, 2012

By John R. Lott Jr.

Format:Hardcover

A great book. The debate over ideas between Keynes and Hayek during the 1930s couldn't be more relevant to the current discussion on the recent recession and the right economic policy to get the economy going again. Pick up a copy of the New York Times and the arguments couldn't be more similar. But this isn't a dry book, you see the lively debates and the personalities behind them with lots of interesting personal facts sprinkled in. You learn not only the arguments that were made, but which ones the partisans in these battles regretted that they made and what they learned from their mistakes. White is one of the few people who could bring together such a broad range of sources together in such a readable way.

The book is much broader than the Great Depression covering everything from the debate over the proper role of government in the great Socialist Calculation debate to free trade to the debates behind what White entitles "The Growth of Government" (though this chapter was much too short).

I still have my criticisms. For example, I would have included a lot more economists in some of these debates, and I think that it is arbitrary who is given credit for making some arguments. For example, Donald Wittman's discussions about the efficiency of Democracies ignores the fact that Gary Becker had already made the central argument in 1976 in the JLE (of course, there were other less well known economists such as Earl Thompson who made a whole career making these arguments and published some of them in the JPE). And the book has a strong GMU bias in terms of which arguments it considers. And I disagree with some of the arguments.

But despite those minor quibbles, it is a strong book that is well worth the read.

19 of 20 people found the following review helpful

5.0 out of 5 stars A tour de force May 28, 2012

By George Hariton

Format:Hardcover|Amazon Verified Purchase

It is amazing how much the author can pack into 400 pages, The writing is clear and entertaining, leavened by anecdotes and sketches of some very famous economists. Yet the author covers hotly debated issues in enough depth that the reader can understand what the opposing positions were, and why people held them. This is particularly important to a lay reader, as some positions may seem so weird that an uninformed reader may wonder why anyone could reasonably hold them. After White's explanations, they become plausible, even if not convincing to a twenty-first century reader.

To take just one example, Hayek long advocated privatization of money, i.e. government should get out of the business of printing (or minting) money and let competing private sector issuers do it. Sounds absurd, but White shows the logic in terms that can be understood by a lay reader, and that might be informative to a professional economist.

While White covers a great many issues, the common thread is the scope of government versus the scope of private enterprise and market forces. Thus at one extreme Oskar Lange claimed that, now that we had computers (written around 1950), bureaucrats could calculate a proper price for everything and there is no need for free markets to set prices (or for any other reason). At the other extreme, James Buchanan and Gordon Tullock argue that governments usually act to please special interests, including bureaucrats and certain producers, at the expense of the general taxpayer.

The centerpiece of the book, however, is the argument between Keynes and Hayek, as to whether government should massively intervene when the ec0onomy turns down, or whether market forces should be allowed to play out. This is a crucial debate today among both economists and policy-makers. White's account of Keynes and Hayek sheds welcome light on the issues. Indeed, one can compare this book with Nicholas Wapshott's account of the same clash. While Wapshott writes at greater length, and covers much more of the politics, White does a much better job of getting at the economic principles behind each position (and that are still in play today)..

13 of 14 people found the following review helpful

4.0 out of 5 stars Easy reading to get a background on key macroeconomic issues during the 20th century May 29, 2012

By Jackal

Format:Hardcover

The chapters highlight key historical events (eg Great Depression in the 30s, German strong growth in the 50/60s, stagflation in the 70s). Each chapter also introduces some economists and their ideas aimed at dealing with the problem at hand. While the book chapters are chronological, the economists and their ideas are only roughly chronological. Sometimes a chapter backtracks to introduce the ideas of older economists. The overall structure of the book works very well.

The economic explanations are not very complicated and you do not need any background in economics to understand the book (except probably when it comes to discussions about interest rates). This is both a strength (large potential audience) and a weakness (only scratches the surface). Actually, I think the book would be ideal for readers interested in social/intellectual history. A good overview is achieved by digesting this book. There are also loads of useful references to the seminal works in the history of economic thought. It is also not bad for people with economic training who what a historical perspective - and that really should include all macroeconomists. Then it will serve as a great first reader (and you can subsequently follow the numerous references to find the original sources).

Alternatives:
- This book compares favourable to Blaug's Economic Theory in Retrospect. Blaug's book is much more detailed when it comes to economic theory, but does not have the somewhat broader economic history focus. Blaug's book is originally written decades ago and some of the details are no longer that relevant. So while an economist (or economic historian) might prefer Blaug's book, an historian would prefer the current book. For the causal reading the choice is clearly the current book.
- The Evolution of Macroeconomic Theory and Policy also has chapters based on historical events, but its focus is on economic theory. Thus this is a very different book, which I rate at three stars.
- Competing Schools of Economic Thought, in contrast, has chapters focused on key historical economists, starting with Adam Smith. The focus is on these giants (similar to Blaug) and not much historical context is given. I have only skimmed this book, but it is neither great nor awful.

The writing style is rather informal, but somewhat uneven. In general, the text should have been edited more meticulously. Still, it is almost an entertaining reading. Unfortunately, the author/printer has messed up the section headings in the book; no distinction made between broad section headings and more narrow headings. So at times the headings turn out to be misleading. Irritating, but you get used to it.