Books List for Summer 2

The Power of Creative Destruction: Economic Upheaval and the Wealth of Nations by Philippe
Aghion, Céline Antonin and Simon Bunel, translated by Jodie Cohen-Tanugi, Belknap Press

In this important book, Aghion of the Collège de France and the London School of Economics and
two collaborators elucidate research on Joseph Schumpeter’s seminal idea of “creative destruction”.
This rests on three foundations: first, “innovation and diffusion of knowledge are at the heart of the
growth process”; second, “innovators are motivated by the possibility of lucrative monopoly”; and,
finally, innovation threatens incumbents, who will fight to thwart it.

Economics in One Virus: An Introduction to Economic Reasoning through Covid-19 by Ryan A

Bourne, Cato

In this excellent book, Bourne of the free-market Cato Institute applies economic ideas to the issues
raised by the pandemic. Among other topics, he elucidates externalities, the relationships between
private behaviour and public policy, cost-benefit analysis, marginal thinking, decision-making under
uncertainty, regulatory trade-offs, the value of trade, how politics determine who is rescued and
why we were unprepared for such a widely recognised danger.

Innovation in Real Places: Strategies for Prosperity in an Unforgiving World by Dan Breznitz, Oxford
University Press

In this fascinating book, Breznitz, a professor at the Munk School at the University of Toronto, argues
that innovation is “the only way to ensure sustained long-term economic and human-welfare
growth”. But, crucially, “innovation is not invention, nor is it high-tech and the creation of new
technology and gadgets”. It is “the complete process of taking new ideas and devising new or
improved products and services.” This catholicism gives fascinating insights.

Value(s): Building a Better World for All by Mark Carney,

William Collins Carney, the former governor of the Bank of England, has written a surprising book. It
begins with an emphasis on the distinction between a market economy and a market society. It then
discusses how three crises — the global financial crisis, the Covid-19 crisis and the climate crisis —
challenge us. Finally, it is a call to recognise the value of values, among which are “responsibility,
fairness, integrity, dynamism, solidarity and resilience”.

The Wealth Hoarders: How Billionaires Pay Millions to Hide Trillions by Chuck Collins, Polity
In this fascinating book, Collins, a man who gave an inherited fortune away, describes in detail the
web of legal protections — tax havens, trusts, shell companies, even charitable foundations —
constructed by clever and unprincipled members of the wealth defence industry, to protect vast
fortunes, themselves frequently the product of fraud, corruption and outright gangsterism. Read and
weep.

An Economist’s Lessons on Happiness: Farewell Dismal Science! by Richard A Easterlin, Springer

Does money buy you happiness? Easterlin, the grandfather of “happiness economics”, has long
argued it does not. He also insists that we can measure happiness and, once this is done, it is the
government’s job to promote it, rather than national income.

This is an increasingly widely shared belief. But it is worth noting that, according to the World
Happiness Report, the happiest countries are all prosperous western democracies. Religion and the
Rise of Capitalism by Benjamin M Friedman, Knopf Harvard’s Friedman tackles the relationship
between religion and the rise of capitalism, on which the German sociologist Max Weber wrote in
the early 20th century.

Friedman makes two particularly important points: first, 18th-century religious belief in the
possibility of betterment on earth suffused early economics; and, second, the idea that socialism (or,
worse, communism) was simultaneously hostile to Christianity and capitalism has created the potent
ideological alliance seen in contemporary US conservatism.

Rescue: From Global Crisis to a Better World by Ian Goldin, Sceptre

Oxford university’s Goldin argues that, pre-pandemic, the world was going to hell in a handcart:
soaring inequality, rising populism and environmental disaster. But the shared catastrophe of the
pandemic might rescue us. “The task now,” he says, “is to turn the reactive responses to the health
and economic emergencies into a proactive set of policies and actions to create an inclusive and
sustainable world of shared prosperity.” It is an optimistic vision.

Noise: A Flaw in Human Judgment by Daniel Kahneman, Olivier Sibony and Cass R Sunstein, William
Collins

The Nobel laureate Kahneman has co-authored with Sibony, of HEC Paris, and Sunstein of Harvard, a
fascinating book on “noise”, defined as “the unwanted variability of judgments, and there is too
much of it.” Noise is what is left when bias has been eliminated.

It “is variability in judgments that should be identical.” Noise creates mistakes, sometimes ones of
enormous magnitude. It is hard to eliminate. But we can try. But, first, we must recognise its
importance.