I don’t know the answer, but here are several – contradictory – pieces of evidence.

Darrell Delamaide on the attractions of self-publishing in a world of ultra-cautious conventional publishing. The broad digital highway carries new books to new audiences.

Sam Harris, taking the opposite and pessimistic view that blogging and people’s unwillingness to pay for anything much online are destroying the scope to make a living from writing. And besides, nobody wants to read anything longer than 60 pages anyhow.

The OUP offering its online platform for publishing monographs (Oxford Scholarship Online) available to other academic presses – the first batch includes Fordham University Press (Fordham Scholarship Online/FSO); The American University in Cairo Press (Cairo Scholarship Online/CSO); The University Press of Kentucky (Kentucky Scholarship Online/KSO); University Press of Florida (Florida Scholarship Online/FLASO); Hong Kong University Press (Hong Kong Scholarship Online/HKSO). Edinburgh University Press (Edinburgh Scholarship Online/ESO) and Policy Press (Policy Press Scholarship Online/PPSO) are slated for March 2012. And, OUP officials say, additional presses are in talks to participate.

These come after the announcement I noted recently from Yale University Press that it will be publishing physical books derived from free online lectures.

Fascinating (at least for an economist) to watch this business evolution in action.

… is fear itself, as FDR famously said in his first inaugural address. One of the characters in Robert Harris’s new thriller, [amazon_link id=”0091936969″ target=”_blank” ]The Fear Index[/amazon_link], cites the quotation en passant. Although I’m only halfway through the book, I’ve got no hesitation in recommending it as a must-read. It’s both a page-turner and a terrific insight into modern financial markets (albeit slightly exaggerated for the purposes of creative tension). Buy it and read it now, or at least on your next plane/train journey!

[amazon_image id=”0091936969″ link=”true” target=”_blank” size=”medium” ]The Fear Index[/amazon_image]

The book sent me back to FDR’s 1933 address, which makes fascinating reading in today’s context. One or two of his statements are very much of their time – for example, the intention to return people from the industrial centres to the land. But many elements could be lifted directly into any current commentary on the state of the economy. Try:

“Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men…..They know only the rules of a generation of self-seekers. They have no vision, and when there is no vision the people perish.

The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit.”

Or:

“If I read the temper of our people correctly, we now realize as we have never realized before our interdependence on each other; that we can not merely take but we must give as well.”

I commend the whole speech to anyone who, like me, hadn’t read it in full before.

A new book about the threat China poses to the United States is a good illustration of the different approach taken by political scientists and economists in assessing international competition. Even those economists who are not gung ho free marketeers believe that, for the most part, trade and cross border investment bring mutual benefits. Not so those authors who see the world in terms of strategic contests. Aaron Friedberg is one of these. The title of his book, [amazon_link id=”0393068285″ target=”_blank” ]A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia[/amazon_link], says it all. Only one country can reign supreme. This is a winner-take-all view of the world.

I haven’t read the whole book, but its argument hinges on the inability of the US to figure out how to compete with China. China does not fit into any pattern that Americans understand, Friedberg argues, being both a trading partner and an authoritarian state determined to replace the US as the sole superpower, at least in Asia. It’s evident that Friedberg would sacrifice trade relations and instead see the Chinese more clearly as a strategic enemy of growing military might.

The book obviously draws heavily on Chinese sources but it’s dark view of US-China relations means that one of two conclusions must apply. Either most other evaluations of China have been naively optimistic or this polemic is extremely pessimistic. As the book does not seem to cover some of the structural weaknesses often mentioned by economists, such as the ageing population or China’s terrible environmental problems, I incline to the latter conclusion.
[amazon_image id=”0393068285″ link=”true” target=”_blank” size=”medium” ]A Contest for Supremacy: China, America, and the Struggle for Mastery in Asia[/amazon_image]

An interesting new book by Tim Besley and Torsten Persson starts with the important observation that: “Almost all economic analyses presume the existence of an effective state.” They point out, though, that this happy situation has prevailed in only a small number of countries for a short period. How does an effective state come about in the first place? That’s the question posed in [amazon_link id=”0691152683″ target=”_blank” ]Pillars of Prosperity[/amazon_link], and it’s at the heart of understanding economic development because it is a precondition for economic growth and escaping poverty. However, it is a question that hasn’t been widely studied by economists in the past, although historians have always regarded it as a key question.

The authors break down this over-arching question into three subsidiary ones: what forces shape state-building capacity and why do they vary from place to place? what factors drive political violence? and what explains the clustering of state institutions, violence, and income? The answer is threefold, too: an absence of internal political violence and repression; simple, readily enforceable and broad-based taxes; and a justice system that enforces contracts and limits public or private exploitation.

The book is moderately technical, aimed at the professional audience. It sets out a model of institution-building in a polity with two groups of people that generates states of different characters – a weak state with a high degree of political instability, a redistributive state transferring resources from one group to another which is nevertheless sufficiently politically stable to have effective fiscal capacities, and a ‘common interest’ state which is strong and effective because it acts as the name suggests. The development of the theoretical model is the heart of the book. The authors do describe empirical regularities in cross-country data suggestive of the usefulness of their model, but wisely do not attempt to disentangle causal relationships – after all, the actual path of history is over-determined. However, the regressions do perform reasonably well in predicting a ‘prosperity’ index,  capturing peace, state capacity and income levels, in terms of a handful of variables such as ethnic homogeneity, legal origin (English, Scandinavian, German or Socialist), external conflict and constraints on executive action). As the authors conclude, there is a large new research agenda for economics when it comes to understanding the process of building states.

This must be correct. I can only think of a few other economics books on this general terrain. One is [amazon_link id=”0199267669″ target=”_blank” ]Fighting Poverty in the US and Europe: A World of Difference[/amazon_link] by Alberto Alesina and Ed Glaeser, which looks at the social cohesiveness of the US versus European countries. Another is James Scott’s terrific [amazon_link id=”0300078153″ target=”_blank” ]Seeing Like A State [/amazon_link](which is political science anyway, and  focuses later in the state-building process). Also relevant for understanding how social and political cohesiveness develop –  or not  – must be Scott Page’s [amazon_link id=”0691138540″ target=”_blank” ]The Difference[/amazon_link], which sets out the value of diversity for problem solving within the context of shared goals. This is a fascinating set of questions, and [amazon_link id=”0691152683″ target=”_blank” ]Pillars of Prosperity [/amazon_link]will be essential reading for other researchers in this area.

[amazon_image id=”0691152683″ link=”true” target=”_blank” size=”medium” ]Pillars of Prosperity: The Political Economics of Development Clusters (The Yrjo Jahnsson Lectures)[/amazon_image]

On my travels thus week I’ve been reading [amazon_link id=”0712665757″ target=”_blank” ]Illuminations[/amazon_link], the collection of essays by Walter Benjamin, to fill one of the many gaps in my education. He is a difficult writer, verging on a parody of a critical studies essay on himself in some places. But it’s worthwhile for the insights too. One that struck me was a comment about storytelling, and the role of the novel in assisting the decline of the older oral tradition of storytelling. He says: “the dissemination of the novel became possible only with the invention of printing.” well, of course we all know that the medium is the message but I’d never really concentrated before on the role of technology on shaping the form in the case of books and literature. Maybe it’s obvious to everyone else… Anyway, it set me pondering about what will really be the form for the written word that emerges from online technologies. I don’t think we’ve seen it yet, for all the innovation in publishing.
[amazon_image id=”0805202412″ link=”true” target=”_blank” size=”medium” ]Illuminations[/amazon_image]