I'm about to start reading a book that normally I wouldn't ever have browsed off the shelf, nor even read a review of. It's The Ecotechnic Future by John Michael Greer. It's a 'green' book rather than an economics book, the author is billed as a Master Conserver and organic gardener whose blog is called TheArchdruidReport. New Age alarm bells ringing, or what! However, the bibliography – the acid rule of thumb test for a book's likely quality – looks great. More important, it was recommended to me as a must-read in order to think about the future by Andrew Curry, who is a clever and interesting man. So I'll give it a go & let you know.

It did make me reflect on the importance – and difficulty –  of staying open-minded, especially after reading this terrific Chris Mooney article in Mother Jones about our cognitive weaknesses, including confirmation bias.

I can't praise Poor Economics by Abhijit Banerjee and Esther Duflo highly enough. Although its subject is economic development, all economists interested in any aspect of public policy should read it.

The book describes the policy prescriptions development economists can derive from the randomised control trials advocated by the Abdul Latif Jameel Poverty Action Lab (J-PAL), which they co-founded. Its perspective is similar to that of another book reviewed here recently, More Than Good Intentions, although the latter was more focused on the application of behavioural economics to development policy, and in particular how to market different types of behaviour to “customers” for aid or policy intervention. However, what I found most interesting about Poor Economics was the evident applicability of its approach to economic policy anywhere.

The book is organised into thematic chapters – healthcare, education, financial services (both borrowing and saving) and entrepreneurship.

The chapter on education is outstanding. It describes a number of experiments to assess the effectiveness of different interventions – proving textbooks, school uniforms, deworming pupils, taking photos of teachers to reduce their absenteeism. It also addresses some puzzles about why it appears to be so hard to persuade people – either parents or schools – to adopt some behaviours which clearly deliver a high economic return. The answer lies in two insights. One is that low-income parents make a correct assessment of the average return to education but greatly over-estimate its variability: “They see education as a lottery ticket, not as a safe investment.” (p87) Often, families will educate only the one child they consider to be the best bet academically. The other is that school systems have low expectations of most poor pupils, and teach to the elite. “References to a certain old-fashioned sociological determinism, whether based on caste, class or ethnicity, are rife in conversations involving the poor,” the authors comment (p91). This is just as true of the English teaching system: the worst poverty is the poverty of expectations of many pupils. The good news is that there is evidence that it is perfectly easy to teach every child the basics in school as long as that is the focus of education, and as long as there is detailed and continual assessment of every child.

I also found the chapters on borrowing and saving very interesting. The book is mildly positive about microfinance, although this attitude has earned its authors criticism from some MFIs, which in some cases will not brook anything other than unthinking advocacy. The book notes that the requirement for zero default makes MFIs too inflexible for many would-be borrowers, but equally that the zero default structures are what enable them to keep their interest rates lower than a commercial or moneylender rate. The Indian system of requiring banks to lend a minimum proportion of their loan book to priority sectors gets some support here, despite the complaints of the banks, because it helps small but potentially growing businesses access to working capital. Often these are exactly the kind of firms (and this also is true in the UK) too small to be of interest to the banks. The chapter concludes: “Ultimately, this problem stems from the structure of banks. Because they are, by nature, large organisations, it is hard for them to provide incentives to their employees to screen firms, monitor projects and make worthwhile investments.”  (p180) With microfinance and mobile payments schemes having improved access to financial services for individuals and very small businesses, midi-finance is the next challenge.

Most of all, though, I liked the modest conclusions. Banerjee and Duflo end by saying there is no Big Idea solution to poverty, and much that we don't know. One critique of the experimental approach to development economics is precisely that it only delivers small answers to context-specific problems, rather than generalisable answers. (This theme did emerge in the recent Boston Review forum on the insights of behavioural economics for development, around an essay by Rachel Glennester and Michael Kremer.) However, the obvious answer is that there has been a dangerous tendency in economics to draw big, sweeping answers from context-specific evidence. Greater humility becomes us. Many of the lessons of the J-PAL approach should be applied to economic policy in the rich economies as well.

My one slight disappointment in the book is that its only perspective on the role of the private sector in economic development concerns policies for small enterprises, including microfinance. All poor countries need to industrialize in order to develop their economies, and will need to do so through a mixture of inward investment (for the capital but also the technology and knowledge transfer) and growing domestic businesses which start off as part of the supply chains to those multinationals. This might be classed as macroeconomics and therefore out of scope for this book, but big businesses also play a part in alleviating individual poverty, whether through Safaricom's M-PESA or Unilever's single sachet products. What's more, although the obsession with silver bullet solutions is one thing that has marred development economics over the decades, so is its obsession with solutions lying in the hands of governments and NGOs alone, with no role seen for the private sector.

It's a good sign, though, to want more of a book, rather than less! In addition to the book, there is a Poor Economics website with excellent teaching resources, which I'll certainly be using, and data.

I spent much of yesterday reading Poor Economics by Abhijit Banerjee and Esther Duflo, and will be reviewing it here tomorrow. It has been well received by other reviewers, and in many cases reviewed alongside Dean Karlan and Jacob Appel's More Than Good Intentions. I reviewed that recently here. The Financial Times (registration/paywall), The Economist and Bill Easterly in the Wall Street Journal covered them both together. Forbes also has a review of Poor Economics,  while David Leonhardt discusses More Than Good Intentions with the authors on the New York Times Economix blog. Pretty much all the reviews have welcomed these two takes on the new development economics, along with the recent Getting Better by Charles Kenny. There is certainly a strong sense of focus on small-scale pragmatism, and corresponding impatience with Big Ideas in development, which is very welcome.

Other reviews of interest. Anatol Lieven's book Pakistan: A Hard Country features in The Guardian and  The Observer. The FT has a review of Francis Fukuyama's latest, the Origins of Political Order. The Guardian covers the new James Gleick, The Information: A History, A Theory, A Flood. The Economist has reviews of Roddy Boyd's book about the collapse of AIG, Fatal Risk, and Paul Allen's memoir Idea Man, which it describes as “permeated by a bitterness towards Bill Gates.”

Will Self reviews Aerotropolis (disapprovingly albeit seriously) in the London Review of Books – I reviewed it (approvingly) here – noting that readers would either love or hate its thesis.

Over at the New York Review of Books, Amartya Sen has an essay comparing the quality of life in China and India. He asks what each is doing with their rapidly increasing per capita GDP, commenting on the absence of political freedom in China and the intolerable inequality in India, concluding that growth matters but is not enough. The New York Times Sunday books section reviews William Cohan's book about Goldman Sachs, Money and Power.

All in all, there's a lot around to read. The in-pile is growing totteringly large again.

Looking at other people's libraries is one of life's simple pleasures. Over the holiday weekend our family visited Sissinghurst Castle, home in the 1930s of diplomat and politician Harold Nicolson and writer Vita Sackville-West. The glory of the place is its garden, but I loved the library, which had the authentic smell of old paper and bookbindings.

Some 30 years or so ago I dipped a bit into Nicolson's Diaries. He was, like Keynes, a critic of the Versailles Treaty. Later he had a career as an MP and (in the 40s) a BBC Governor. I've just ordered the diaries to remind myself – the political diary genre, ranging from Richard Crossman through Alan Clark to Chris Mullin is extremely varied of course, but for the most part an interesting read if only for the insight into the distinctive way of thinking a life in politics imposes on people.

The most envy-inducing library I ever visited, though, was that belonging to Mario Vargas Llosa in Madrid. I went to interview him for a BBC Radio 4 Analysis on globalisation. (I can't link to it at the moment as the volume of Royal Wedding traffic on the BBC website is preventing it from responding to any other requests!) It was an old building near the palace. The room had a mezzanine, with his desk on the gallery and sofas around a low table on the lower level. And books. Lots of. It was hard to concentrate on the interview.

Aerotropolis: The Way We'll Live Next by John Kasarda and Greg Lindsay is a fascinating book; and although I suspect readers will either absolutely hate its thesis or be absolutely intrigued by it, either way it demands a thoughtful reaction.

The underlying premise is undeniable: cities are fundamentally shaped by transportation. The oldest are organised around water, a navigable river or port, Victorian cities were expanded and shaped by train lines, and since the early 20th century automobiles and major road networks redrew domestic trade and commuting routes, and enabled the spread of suburbs – especially in the US with its sprawling 'Edge Cities'.

Aerotropolis argues that in the age of globalisation, air travel has already altered choices about work and home locations and about business location – and will only continue to do so. The question is whether urban authorities go about dealing with this in a haphazard way – as in London, where finding agreement about where and how to expand capacity seems impossible – or in a planned way with a sufficiently large international airport connected to residential areas by convenient public transport and with sensible mixed-use zoning nearby.

The book has many interesting examples – mainly from the US but other countries too – of both approaches. I'm convinced that the haphazard approach, hostage to the pious pretense of some environmentalists that we're going to stop flying and the NIMBY-ism of those living near airports (no matter how much they fly), is inferior.

One reason is, in fact, that the environmental impact of airports can be much better managed if realism reigns. Better by far to embrace the airport and its benefits, and ensure that the public transport links are built, for example. Ed Glaeser's recent book, Triumph of the City, also sets out the possibly surprising environmental benefits of a wholehearted embrace of urban life.

The second reason is that the economic benefits of physical connectivity are often, I think, underestimated. The productivity effects of information and communication technologies emerged first and most strongly in distribution and logistics – FedEx and UPS, WalMart and Tesco, clothing retailers such as Zara and their Chinese suppliers are all characterised by their ultra-efficient supply and logistics chains. The economic development officer in Memphis, which reinvented itself as an aerotropolis to house FedEx, makes this point in the book. At the time, he says, other cities looked down on 'distribution' as a low value, low-paying alternative to the vanishing traditional industries. But over time, being a superb hub for distribution – and also for globe-trotting executives – has brought in high value activities. The climb is reflected in the job titles, he says: from 'warehouse manager' to 'assistant manager of logistics' to 'senior vice president, global supply chain'. (pp81-82)

Many people have also certainly made the mistake of assuming that the technologies substitute for face-to-face contact, when in fact they complement each other. As Aerotropolis notes, the highest-tech industries clock up the most executive travel. “Trillions of connections yield billions aloft. The more wired we are, the more we fly. …. At the current rate, the Internet will render business travel obsolete at about the same time it replaces paper.” (p113)

I'm not sure how far reason will ever reign in urban planning, including the planning of transport. Passions run high and property prices are at stake. The romanticism of environmentalism conflicts with the reality of profitable global supply chains and global careers. I for one enjoyed the vision of the gleaming, bustling aerotropolis. It will all be a bit too J.G. Ballard for some, but I write as one who lives close to Heathrow and rather enjoys the experience of battling with London Transport and BAA security to have a leisurely coffee in a crowded and over-retailed departure lounge while watching all the world's people go by.

One odd thing, and it does get in the way, is the authorship. Journalist Greg Lindsay has done the writing, and the book is well-written with vivid reportage. Professor (and uber-consultant) John Kasarda is, however, billed as the author because his ideas have inspired the book. It got me surprisingly confused about the status of the authorial voice. A minor complaint. This is a fascinating book stuffed full of information.