The Undercover Economist: Exposing Why the Rich Are Rich, the Poor Are Poor--and Why You Can Never Buy a Decent Used Car! Hardcover – November 1, 2005
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From Bookmarks Magazine
Copyright © 2004 Phillips & Nelson Media, Inc.
- Publisher : Oxford University Press; 56255th edition (November 1, 2005)
- Language : English
- Hardcover : 288 pages
- ISBN-10 : 0195189779
- ISBN-13 : 978-0195189773
- Item Weight : 1.2 pounds
- Dimensions : 9.2 x 1.1 x 6.3 inches
- Best Sellers Rank: #1,045,371 in Books (See Top 100 in Books)
- Customer Reviews:
Top reviews from the United States
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I bought this book as a layman trying to understand how economists think. The first few chapters were interesting, as the author attempts to explain basic notions such as “the world of truth”, marginal value, free trade, game theory, and more. The explanations were clear and the writing quite engaging. Things fall off in the final chapters, revealing some of the bigger problems with economic thought, or at least with this economist’s thinking. Specifically, chapter 8 attempts to discuss why poor countries are poor. Clearly the author is trying to show us that the reason is the lack of free markets and correct incentives. But that begs the question: Why are some countries able to get this right and others not? The author fails to provide an answer because he ignores an important factor: culture. Chapter 9 is even worse, as the author discusses the grand benefits of globalization. Sure, there are benefits, but he ignores the disadvantages and also the fact that these benefits are not spread evenly throughout society, at all - some sectors are getting killed. The author writes like someone who is so busy drinking Belgium draught beer in a pub in London and flitting about the world in pursuit of new sights and sounds, that he cannot hear nor see the suffering that is being caused to others ("sweatshops are great compared to the alternative", as he puts it). Perhaps such attitudes are why economists are considered to be soulless… The final chapter sets up China as a shining example of the successes of globalization. The really funny thing here is that the author completely ignores the fact that China’s success is built on a consistent policy of protectionism through subsidies, tariffs, and currency manipulation – the exact same things that the author spends the entire book condemning! So apparently, protectionism is great when it helps China but awful for everyone else?? I don’t know how else I’m supposed to understand this chapter.
Bottom line: This is an inconsistent book by an economist who seems to be madly in love with himself. I’m sure there are better books to serve as an introduction to economics.
--how China ascended from utter economic oblivion to being the 2nd largest world economy
--why the poorest nations in the world are poor and may never change
If you like this, be sure to listen to or read Tim Harford's "50 things..." https://www.amazon.com/gp/product/0735216134 . It is available as BBC podcasts or book. IMHO, it should be required reading/listening for everyone.
A lot of topics are covered, but none are removed from situations that intimately effect all of us. You get a lot of insight on how various retailers struggle to set the highest price (this chapter alone paid for the price of the book, because it has made me a smarter, better armed shopper.) You learn how the concept of "missing information" makes it hard to buy a good used car as well as for a free market system to create afforable health insurance (the relationship between used cars and health insurance was as eye opening as it was fascinating.) You also learn that ecnonomists have some very good solutions to handling traffic congestion and pollution, if only the politicians would learn and listen.
This is just a sample of what is available, all written in a friendly, accessible style. No math, no graphs. Just a lot of clear reasoning and mind expanding information. Reading it was well worth my time. Hats off to the author.
Top reviews from other countries
I bought this as an introduction to the economics module of my PPE degree. Having a basic understanding of economics through previous studies and keen interest, I thought this would further enhance my knowledge - I was wrong.
The writing style is poor - many reviewers have cited 'convoluted' , and it really is the perfect word. The concepts used are simple, yet explained in very complex examples. There is little to no formula, or equations to help illustrate examples, instead they are incorporated into the text. Maybe this is an issue with me personally, but after reading numerous pages with different scenarios illustrating the same concepts, it becomes tiresome when there is no foundation to build upon or refer back to.
I am experiencing little enjoyment from this book, and frequently have to reread paragraphs due to not fully understanding / comprehending, and not being captivated by the writing style. It feels a chore.
In saying that, there have been a few instances where I have taken something positive from the book, meriting it two stars ( quote from the French economist about pricing structure on rail travel ).
If you are new to economics, I recommend 'Freakonomics' or 'Narconomics', both of which were easy to read, understand and actually captivating, dealing with real life situations. Of course, 'The Undercover Economist' deals with real life scenarios, but they are purely theoretical, not taking into consideration politics and various other personal & consumer choices.
This book explains so much – from why the gap between the rich and poor countries is so great to how supermarkets, airlines and coffee shops succeed in extracting more money from us. In doing so he covers a wide range of economic principles, from scarce resources, market power, efficiency, price-gouging, market failure, inside information and game theory.
Harford describes in detail how the New Zealand government sold a 3G mobile license for just NZ$6, whilst the UK raised over £22 billion for similar licenses. And his analysis of the Chinese economic revolution is extremely illuminating – combining it with an explanation of why globalisation is beneficial to the whole world.
The book is along the same lines as a raft of populist social/science books - perhaps the most obvious comparison is with Steven Levitt’s “Freakonomics”. However, while the two share an easy reading quality, Freakonomics is more concerned with micro economics (and human decisions) while Harford also covers macroeconomic arguments. Of the two, I found Harford’s more interesting and insightful. It seems more concerned with explaining things than going for the shock value. That’s not to say that there are not some contentious issues - the economic view of sweatshops for example won’t thrill everyone but his arguments are well reasoned.
There is a clear development of Harford’s approach - from the importance of scarcity right up to looking at the reasons for China’s development. The content of the chapters is cross referenced so you get a real sense of an argument building.
The concept of Harford as an “undercover economist” is the only area that doesn’t live up to the promise. Sure there are times when he uses the idea to explain why things are as they are from an economist’s point of view - notably looking at coffee prices - but while there are times when it is a useful device, for much of the book the undercover concept is a bit spurious. It’s really more of an explanation of why the world is as it is economically.
It’s both an enjoyable read and a very good and clear introduction to some key economic ideas that will give some useful examples to explain the key ideas.