Overcoming the two cultures?

After a couple of thrillers for holiday-light relief (a dark Swedish number called Three Seconds, which was good and provided a suitable contrast to compulsory Christmas good cheer, and a Barcelona-based police procedural, Dog Day, rather mannered), I turned to a posthumously-published book by Stephen Jay Gould, The Hedgehog, The Fox, and the Magister’s Pox: Mending the Gap Between the Science and the Humanities.

The subtitle spells out the aim of the book, and in a way it’s hard to see anybody disagreeing with the argument that there are different methodologies able to illuminate the world. Gould argues that important methodological differences do not simply map onto C.P.Snow’s ‘two cultures’ of science and humanities. Some sciences have to take an historical approach rather than an experimental one. He says:

“A large range of factual subjects, evidently part of science and duly explainable (in principle) by empirical methods operating under natural laws, treats different kinds of inordinately complex and historically contingent systems….as not deducible or predictable at all from natural laws tested and applied in laboratory experiments.” They rest instead on a specific historical sequence of events and can be explained afterwards but are unpredictable beforehand. Examples are the history of continents and landforms, the phylogeny of life. I’d include economics alongside geology and evolution as this kind of empirical subject, the key being that newly discovered evidence or a new chain of events can overturn hypotheses.

However, Gould goes on to argue that the deep-seated habit in all argument of dividing the world into dichotomies is highly misleading anyway. Not only do fuzzy boundaries crop up everywhere (see the philosophy of vagueness), there are more than two possibilities in many kinds of circumstances, including ways of understanding the world. (This was also a theme of Gillian Rose’s brilliant Mourning Becomes the Law) The continuum is actually more pervasive than the dichotomy, although it’s interesting to think about what in our mental make-up makes the division into two so attractive, and about whether we can overcome it.

Thirdly, the book also argues that the idea of a war between science and religion makes no sense. It is not true historically – he learnedly discusses the debates of the 17th to 19th centuries in which churchmen were often to be found on the ‘side’ of science. And the two occupy non-overlapping territory, he argues. The domain of religion is not factual knowledge, the domain of science is not spiritual belief.

An enjoyable read. Gould was one of the most readable of science writers, although the subject matter of this book is serious going. And a suitable thought to take from 2011 into 2012, a year when we seem likely to be presented with a lot of attempts to divide views into two opposing camps.

Happy New Year to all!

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Forthcoming economics books, part 2

Here are some more new economics titles to look forward to in the months ahead, this time from general trade publishers.

I’m very much looking forward to David Wolman’s The End of Money from Perseus.

Norton is bringing us the widely trailed Keynes Hayek by Nicholas Wapshott. This sounds like another must-read, looking at the original clash and its contemporary relevance. Also from Norton, on the US economy, First Principles: Five Keys to Restoring America’s Prosperity by John Taylor of Stanford University.

From Profile, we have a business biography, I Love Mondays: the autobiography of Alec Reed, written with veteran financial journalist and biographer Judi Bevan; and Africa’s Future: Darkness to Destiny by Duncan Clarke.

Wiley is publishing another business story, Twitter for Good: Change the World one Tweet at a Time, by Claire Diaz-Ortiz, with a foreword by Twitter founder Biz Stone.

Penguin’s forthcoming list is heavy on financial self-help, but his one caught my eye: The FitzPatrick Tapes: The Rise and Fall of One Man, One Bank, and One Country by Tom Lyons and Bryan Carey.  The authors, two journalists who have covered the extraordinary story of Anglo-Irish Bank throughout, have incorporated a series of formal interviews with its former chairman Sean FitzPatrick.

Little, Brown is publishing a book by FT journalist Edward Luce on American decline, Time to Start Thinking: America and the Spectre of Decline. His book on India, In Spite of the Gods, was excellent. Another US title is co-authored by Thomas Friedman and Michael Mandelbaum, That Used To Be Us: What went wrong with America – and how it can come back. I only occasionally agree with Andrew Simms of the New Economics Foundation but he’s always worth reading. His book Cancel The Apocalypse: Why we need to stop growing and start living is out in June.

An interesting prospect from Palgrave is the forthcoming How China Became Capitalist by Nobel Laureate Ronald Coase and Ning Wang. I can’t think what Coase’s most recent book before this was. Just out from the same publisher is The growth of Public Expenditure in the united Kingdom from 1870 to 2005 By Clive Lee, whose statistical appendix looks like a good resource.

Bloomsbury has what looks like a must-read on one key part of the Arab Spring, Cairo, My City, Our Revolution by Ahdaf Soueif.  Also of interest is The Great Disruption: How the Climate Crisis Will Transform the Global Economy by Paul Gilding;  and also a novel of the financial crisis, Other People’s Money, by Justin Cartwright, out in paperback.

Cairo: My City, Our Revolution

Finally, Constable & Robinson are publishing The Road to Wigan Pier Revisited by Stephen Armstrong, a good idea for the new austerity Britain, and for all those interested in behavioural psychology, The Self Illusion: Why There is No ‘You’ Inside Your Head by Bruce Hood, this year’s terrific Royal Institution Christmas Lecturer.

The Self Illusion: Why There is No ‘You’ Inside Your Head

This post and yesterday’s have not been at all systematic, so if any publishers I’ve omitted would like to let me know what they have in store, I’ll do a further round-up early in the New Year.

Upcoming titles in 2012

New Year’s Resolution time, and if yours is to read a lot more economics books, a look-ahead at some forthcoming titles over the next few months in this post and the next might encourage you. I’ll start here with some of the major university presses, general trade publishers will follow later in the week.

My own publisher, Princeton University Press, has a new book out in April by Robert Shiller of Irrational Exuberance fame. It’s called Finance and the Good Society, and argues that we need more financial innovation rather than less in response to the crisis, but it needs to be harnessed to the common good. Paul Seabright, one of the most creative economist working on the borders with other disciplines has a book The War of the Sexes arguing that the conflict between the sexes is, paradoxically, the product of evolutionary co-operation. The new book from economic historian Harold James is Krupp, a history of one of the most important industrial firms in Germany, looking at its changing social and economic role over two centuries.

MIT Press has  forthcoming in March The Clash of Generations, by Laurence Kotlikoff and Scott Burns, looking at the timely question of the US’s unsustainably huge off-balance sheet debts, thanks to the structure of social security and healthcare, which make its fiscal situation in reality much worse than that of Greece or Ireland. A collection of essays by leading economists, edited by Olivier Blanchard, David Romer, Michael Spence and Joseph Stiglitz, looks at the fundamental questions raised about macroeconomics, In the Wake of the Crisis. Adair Turner, in a similar vain, has a book called Economics After the Crisis, out in April.

Over at Yale University Press, Peter Marsh of the FT has The New Industrial Revolution Consumers, Globalization and the End of Mass Production, which does what it says, describing the continuing shift of industry to emerging economies and looking at the implications for the old industrial economies. But to remind us of all the pitfalls on China’s path to prosperity, there is The End of the Chinese Dream: Why Chinese People Fear the Future by Gerard Lemos. I was intrigued by the look of Visual Strategies: A Practical Guide to Graphics for Scientists and Engineers by Felice C. Frankel and Angela H. DePace, which looks like it could be useful for economists.

More on China: Oxford University Press has China’s Remarkable Economic Growth by John Knight and Sai Ding, which looks specifically at the political economy of the country’s development. There is a collection of essays looking at the realpolitik – specifically, in game theoretic terms -  of climate change, Climate Change and Common Sense: Essays in Honour of Tom Schelling, edited by Robert W. Hahn and Alistair Ulph. (I attended the workshop on which these essays were based, and the recommendations that emerged differ in interesting ways from the conventional wisdom.) Topically, OUP has a critical look at credit rating agencies, Credit Rating Agencies on the Watch List: Analysis of European Regulation by Raquel García Alcubilla and Javier Ruiz del Pozo.

Finally for this post, I really like the look of Institutional Revolution: Measurement and the Economic Emergence of the Modern World by Douglas Allen, published in January by the University of Chicago Press. It looks at the institutional revolution that accompanied and made possible the Industrial Revolution.

Most read posts of 2011

As the New Year approaches, it’s time to round up the ten most read posts on this blog during 2011. Actually the exercise is complicated this year by the fact that I switched software in the summer, making it difficult to recover the statistics for individual posts in the first half of the year, but this is mitigated by a strong upward trend which makes it unlikely that I missed anything significant in the first few months. And no, I’m not going to detrend the data…

So here they are:

1. By a country mile the most read was Why I Hate the Kindle, a rant written on my return from demolishing a pile of paperbacks during the summer holiday. It was picked up by Alphaville on the FT website and by the WSJ blog. This was also the most commented post: a large number of readers seemed not to notice that it was a personal rant and I’m allowed to think what I like.

2. The Economist as Hero – reviewing some novels featuring decisive, action-oriented economists. So much like real life? Were readers inspired to start writing their own economics-based thrillers? I have one in mind myself (featuring a middle-aged but still energetic London-based female economist) but meanwhile the contract for my next economics book is likely to delay it again.

3. Anything to do with technology is widely read online, for obvious self-selection reasons. At number 3 was The BBC Micro and Computer Literacy. This proved timely, too, given the renewed interest in getting kids coding and the launch of the Raspberry Pi and no doubt many other initiatives. This is in the air.

4. Books of the Year. Popular with people starting their Christmas shopping. I wonder how many lucky folks received my The Economics of Enough this year?

5. Keynes’s Real Lesson for Today, which reviewed an excellent new, short biography by Roger Backhouse and Bradley Bateman, Capitalist Revolutionary. Keynes, like other greats such as Adam Smith, is reinterpreted in every era in the light of events.

6.The latest of my posts on innovation and the economics of publishing, To e or Not To e? The publishing industry is doing better in its response to the disruptive technologies than the music industry (which was determined not to let its consumers have what they wanted) or the newspaper industry (with – in some cases – a patronising view of its consumers and no luck yet finding a micro-charging mechanism).

7. The post Serious Economics for Serious Times talked about the current appetite for understanding. It is manifested not just by people wanting to read serious books – there are quite a few suggestions in this post – but also in the popularity of public lectures, serious news and current affairs programmes, conversations on blogs and Twitter.

8. Another review next, 10 Things about 23 Things They Don’t Tell You About Capitalism, the bestseller by Ha-Joon Chang.

9. Is Behavioural Economics Just A Fad? (No – witness Daniel Kahneman’s magnificent Thinking, Fast and Slow – but let’s not lose our rigour in our enthusiasm for incorporating more realistic psychology into economic analysis.)

10. Another Throw of the Boomerang. Last in the top 10 is another review, of Michael Lewis’s latest book.

As ever, a slightly surprising list. Timing always plays a part in the number of visitors – I haven’t yet learnt to optimise this but late Friday afternoon seems a good time and Sunday morning not. Twitter dynamics are obviously important, so a link being retweeted by one of the major blogs or gurus explains some of the entries above.

This will not be absolutely my last entry for 2011, as I want to take a forward look at upcoming titles; but if it’s the last one you read, Happy New Year and my best wishes for 2012. It looks like it will be an interesting year.

Christmas thoughts on consumerism

I didn’t know what to make of Against Thrift: Why Consumer Culture is Good for the Economy, the Environment and Your Soul by James Livingston. Reading it was like being on the receiving end of an argument you don’t understand – there’s no mistaking the author’s passion and eloquence but not enough common terrain for a debate.

The subtitle and blurb make it clear that the book aims to be contrarian, and made me think I was getting a counter-blast against government austerity measures to cut the deficit. But it’s actually an argument with the author’s perception of economic growth theory. As far as I understand it (and I could have completely misunderstood), his argument is that the conventional wisdom is that investment in capital is what determines the economy’s rate of growth, that investment requires saving, and that people are therefore constantly urged to be thrifty. Moreover, this fits in with their natural “powerful psychological urge to put their desires on hold…. Because everyone knows how and why to defer gratification.” (page xi) However, growth depends actually on consumption not on investment, and in fact the net private investment in the US (as measured by net private capital formation in the National Income and Product Accounts) has been in decline for a century while massive economic growth has still occurred. Prof Livingston also has a cultural gripe about thriftiness: he sees the habit of thrift as a “soul-crushing emotional trap as well as an economic dead end”.

Part of my problem in assessing this is the author, a Professor of History at Rutgers University, draws on Marxist theory, which I’ve never studied. Some parts of the argument seem to make perfect sense. The purpose of economic growth is to enable people to improve their welfare by consuming goods and services in greater amounts and variety, as they desire. So I completely agree that consumption is all-important, and that much economic debate – and especially economic policy – has mercantilist instincts and focuses too much on producer interests. Besides, every economist knows GDP growth rests on consumption growth because that’s about two-thirds of the total. Henry Ford is celebrated for appreciating that the workforce needed to be paid enough to consume in order to create a mass market. It has also become a commonplace in many circles now to note that the profit share of income has increased to new peaks compared to the labour share and – pace Henry Ford – this is not a good thing at all.

But other parts of Prof Livingston’s argument are bewildering. For one thing, one of the many lessons of behavioural economics (and daily experience) is that frankly most people have no ability to defer gratification. Economists and psychologists have written extensively about this, and on the need for commitment devices if anyone is every to diet successfully or not over-spend on their credit card or save enough for their retirement.

And then there’s the claim that conventional theory says growth depends above all on investment. Just to make sure I wasn’t losing my mind, I turned back to the standard growth text, Aghion and Howitt on the Economics of Growth, to confirm that as I thought innovation is seen as the key to growth, albeit embedded in either people’s minds (human capital) or delivered by innovating businesses (tangible and intangible capital). This was true empirically in the heyday of Solow’s neoclassical growth model – all the action was in the technical change term rather than the growth of labour or investment in capital. It’s also now true in standard modern growth theory. The textbook explores this broadly – there are chapters on competition and entry, on institutions, on education, on finance, on trade, on democracy, and on culture. The recent empirical work on growth accounts for it in terms of investment in both human and physical capital but also in terms of the productivity of each and multi-factor productivity. So where does the book’s emphasis on investment (especially as measured in the national accounts) come from? And how does Livingston square his dismissal of the supposed focus on investment with his demolition of the advertising industry which aims to make us spend rather than save?

Despite my bewilderment, I very much enjoyed the sections of the book where Livingston takes on the AdBuster, culture jamming types. This played to my prejudice that clever cultural disdain for consumerism is a rather snobbish attitude on the part of affluent people who are just as consumerist as the rest of us but spend their money on upmarket rather than mass market products and pastimes. The author here focuses on the culture of consumerism. describes the part played by the consumption of western rock music influences – in the shape of the magnificent Plastic People of the Universe – in Czechoslovakia’s Charter 77 and Velvet Revolution. He concludes: “Advertising sells freedom, expands consciousness, and heralds new values in another strange way, by sponsoring a critique of consumer culture from within the precincts of commodity fetishism.” (p131) Its self-references make consumers question their own preferences, he argues.

In the end, though, I had to stop reading the book. It exasperated me too much. I’d like somebody else to read it please, and explain what I’m missing. Meanwhile, it’s time to do some online sales shopping….