best book

A Korean most influential books list

The list is here, I especially liked the first selection:

1.  Fisher-Price Toy Catalog (Age 6)

Yes, I'm serious. Laugh all you want for being childish, but heck, I was a child. At around age 6 while living in Korea, I somehow came to have a spiffy catalog from America that listed all Fisher-Price toys that were available for mail-order. The catalog had all these incredible toys that neither I nor any of my friends have ever seen. I read that catalog so many times, imagining playing with those toys, until the catalog eventually disintegrated in my hands one day.

The catalog was the book that confirmed to me — who was six, mind you — that America must be the best and the greatest country in the world. Later when I came to America, my faith was validated.

Books which have influenced me most

Chris, a loyal MR reader, asks:

I'd like to see you list the top 10 books which have influenced your view of the world.

I'll go with the "gut list," rather than the "I've thought about this for a long time list."  I'll also stress that books are by no means the only source of influence.  The books are in no intended order, although the list came out in a broadly chronological stream:

1. Plato, Dialogues.  I read these very early in life and they taught me about trying to think philosophically and also about meta-rationality.

2. The Incredible Bread Machine, by Susan Love Brown,  This was the first book I ever read on economics and it got me excited about the topic.

3. Capitalism: The Unknown Ideal, by Ayn Rand.  This got me excited about the idea that production is what matters and that producers must have the freedom and incentives to operate.

4. Friedrich A. Hayek, Individualism and Economic Order.  The market as a discovery procedure and why socialist calculation will not succeed.  (By the way, I'll toss a chiding tsk-tsk the way of Wolfers and Thoma.)

5. John Maynard Keynes: The General Theory of Employment, Interest, and Money.  Keynes is one of the greatest thinkers of economics and there are new ideas on virtually every page.

6. John Stuart Mill, Autobiography.  This got me thinking about how one's ideas change, and should change, over the course of a lifetime.  Plus Mill is a brilliant thinker and writer more generally.

7. Willard van Orman Quine, Word and Object.  This is actually a book about how to arrive at a deeper understanding than the one you already have, although I suspect few people read it that way.

8. Reasons and Persons, by Derek Parfit.  This convinced me that a strictly individualistic approach to ethics will not in general succeed and introduced me to new ways of reasoning and new ways to plumb for depth.

9. Camille Paglia, Sexual Personae.  I don't think the ideas in this book have influenced me very much, but reading it was, for whatever reason, the impetus to start writing about the economics of culture and also to give a broader focus to what I write.  Alex, by the way, was the one who recommended it to me.

10. Marcel Proust, Remembrance of Things Past.  This is still the best book on interiority.

I'd also like to mention the two books by Fischer Black, although a) I cannot easily elevate one over the other, and b) I capped the list at ten.  La Rochefoucauld's Maxims also deserves honorary mention, on self-deception and related issues.  Plus there is Shakespeare — also for thinking with depth – although I cannot point to a single book above the others.  Harold Bloom's The Western Canon comes to mind as well.

I would encourage other bloggers to offer similar lists.

America’s best BBQ?

Could it be Lonnie Ray's BBQ, in Harrisburg, Missouri?  That's about half an hour outside of Columbia, Missori.  I ate there yesterday and I am still staggered by the encounter.  It is one of the two or three best barbecue experiences of my life and possibly #1.  It doesn't seem to be written up by any of the standard sources (here is one good web review).

The proprietor, Mike, is also a true scientist and scholar and gentleman.  He studied with Mike Mills and he will engage you at length on how to render fresh lard, why Kansas City barbecue has declined, and the importance of the wood source.  He has studied — and I do mean studied — Texan, Kansas City, and even North Carolina styles.  The pulled pork was my favorite dish and I usually don't like pulled pork much at all.  Both the sauces and the atmosphere get an A+ as well.  He is now studying how to cook tamales.  If only everyone in the scientific community had his attitude.

I am serious in my claims for this place.

Here is their Facebook page, you know what to do.

A second-best theory of libertarian bailouts

Pete Boettke cannot bring himself to utter those few little words.

Let me nudge him (and others) again and try to make things easier for him.  General pro-market or anti-government arguments don't rule out the recent bailouts.  Let's take the hardest, least Friedman-friendly case, the insolvent banks.  For insolvent banks (and for some of the illiquid banks, which might have failed without bailouts), the alternative to those bailouts is calling in deposit insurance and the bankruptcy courts, both of which are, for better or worse, forms of government intervention.  In particular today's bankruptcy procedures are ill-suited for disposing of a large financial institution in a timely manner and this can be considered a form of gross government failure.

Note that even when the Fed "bails out" a large investment bank, or insurance company, they are checking a chain reaction which would likely spread to some commercial banks, thus bringing in deposit insurance as well, not to mention further bankruptcies.  And that's not even considering that Congress probably would have stepped in, I'm just looking at laws already on the books.

So if you're "opposed to financial bailouts," as a libertarian, you're not for the market.  You're saying that one scheme for governmental disposition is better than another.  Of course you are entitled to that opinion but the sheer force of libertarian doctrine is not necessarily on your side.  The general pro-market and anti-government arguments are not necessarily on your side.  I think it is quite plausible for a libertarian to believe that the Fed is "less bad" than the bankruptcy courts and the FDIC.

Now, all things considered, I don't see why this "libertarian two-step" move should be needed.  I think it's enough to simply ask whether the bailouts were a good idea and proceed accordingly.  But if you're concerned about compatibility with libertarian principle, this is one simple way of seeing why my view fits right in.  In fact I think it is the more libertarian of the views under consideration, as it keeps the very worst of the government interventions on the table at bay.

Addendum: Overall I think U.S. bankruptcy law works fairly well, just not relative to the high speeds of market demands when a major financial institution goes bankrupt; Lehman showed this.  This is an under-reported source of "regulatory uncertainty."  (Prepackaged bankruptcy ideas may help, possibly.)  If you are calling for the application of bankruptcy law to major banks, you are calling forth that regulatory uncertainty and yes I do think it is worse than the regulatory uncertainty from a bailout.  The result is that credit markets freeze up and that also leads to other bad interventions.  Another set of problems springs from the difference between a bank and bank holding company; current law doesn't handle this well although changes are in the works most likely.  Of course it is a kind of "super-libertarian" alternative to abolish deposit insurance in the midst of a crisis, as some of you recommend, would you really do that?  I don't think so.

Three Textbooks on Economic Growth

Lately, I’ve been reading lots of textbooks on economic growth. Here are a few:

Introduction to Modern Economic Growth by Daron Acemoglu: Weighing in at just under 5 pounds and 1000 pages this is the Mas-Colell, Whinston, Green of economic growth. It’s hard not be impressed by Acemoglu’s mastery of the subject and for a handful of top graduate programs this is clearly the book for the next generation. The title, of course, misleads in a revealing way–this book is first and foremost a book about modern economic theories of growth and, in particular, the math behind those theories.  Acemoglu is too good an economist to write a book just about the math–there is good material here especially in areas where Acemoglu has made important contributions such as directed technological change and political economy–but the economic insights can easily be lost in this massive tome.  Acemoglu is a good guide to the math but there is no effort to communicate to a larger audience.  Empirical work is occassionally cited, but rarely discussed in much depth.

The Economics of Growth by Philippe Aghion and Peter Howitt: Also aimed at the graduate market this book is the David Romer of economic growth.  Still more of a guide to models rather than to economic growth per se but key empirical work is presented and one does find the words “motivating evidence.”  Simplified models with a touch of empirical analysis drive the book forward.  Combined with a few empirical papers and a bit more background on the theory and this would make a good graduate text for all but the top programs.  Careful questions will prove useful to professors.

Economic Growth (first edition here) by David Weil.  One of the best textbooks I have ever read on any subject – this is the book to get.  Weil’s book covers more topics with greater wisdom and wit than any of the other books and this is first and foremost a book about economic growth rather than about theories of economic growth.  Weil is good on the basic models and especially on tying theory to empirical work.  Ostensively aimed at the undergraduate market, there is a huge amount here for professional economists and graduate students. After passing their prelims on dynamic programming, this is the book that graduate students should read to discover the real questions that are in need of answers.  I learned the most from this book.

When to stop reading a book

Kelly Jane Torrance has a very good article on this question.  This part is quoting yours truly:

"People have this innate view – it comes from friendship and marriage –
that commitment is good. Which I agree with," he says. That view
shouldn't, he says, carry over to inanimate objects.

It's not that he's not a voracious reader – he finishes more
than a book a day, not including the "partials." He just wants to make
the most of his time.

"We should treat books a little more like we treat TV
channels," he argues. No one has trouble flipping away from a boring

There is more:

"If I'm reading a truly, actively bad book, I'll throw it out," he
says. His wife will protest, but he points out that he's doing a public
service: "If I don't throw it out, someone else might read it." If that
person is one of the many committed to finishing a book once started,
he's actually doing harm.

Mr. Cowen, who says he couldn't finish Alexandre Dumas' "The
Three Musketeers" or John Dos Passos' "U.S.A.," offers a more direct
economic rationale. He notes that many up-and-coming writers complain
they can't break through in a best-seller-driven marketplace. "We're
also making markets more efficient," Mr. Cowen says. "If you can sample
more books, you're giving more people a chance."

What is driving the eBooks boom?

Via Yves Smith, here is one hypothesis:

What's popular on Fictionwise? Well, once again it seems like
porn is blazing a path to a new media format. Of the top 10 bestsellers under the "Multiformat" category, nine are tagged "erotica" amd the last is "dark fantasy"…People who read erotic romance and 'bodice rippers' love
ebooks because of the privacy they offer, both during purchase and when

By the way, Andrew Sullivan asks how one is to post 250 times a week and read Ulysses.  The answer is simple: one page at a time. 

One advantage of Kindle is that it provides a new tool for mental accounting.  Call me irrational but formerly I could not read more than seven or eight books at a time without abandoning some of them midway.  Kindle (like Netflix, I might add) gives me a new queue and allows me to have more "hanging," partially unread books at any point in time, yet without disrupting my mental equilibrium.  I'm rereading Moby Dick, one chapter at a time, on plane trips, and next in line are Middlemarch andUlysses

Prudie on husbands who write books

Trudie chuckled when she read these two sentences from Prudie:

I can’t tell if your husband’s fantasies are sweetly pathetic or disturbingly delusional.


You don’t need to crush your husband—you’re right, the marketplace will take care of that task…

The highly egalitarian Trudie believes that everyone deserves a chance.  What would Immanuel Kant’s wife (it is no accident he didn’t have one) have said about his draft of Critique of Pure Reason?  Trudie offers the husband — if he can be located — the following deal, maintaining his anonymity if he so wishes.  I’ll read the manuscript, or at least try to, and tell everyone what I really think.

Do self-help books make us happier?

Ad Bergsma says yes:

Advice for a happier life is found in so-called ‘self-help books’, which are
widely sold in modern countries these days. These books popularize insights from psychological science and draw in particular on the newly developing ‘positive psychology’. An analysis of 57 best-selling psychology books in the Netherlands makes clear that the primary aim is not to alleviate the symptoms of psychological disorders, but to enhance personal strengths and functioning. Common themes are: personal growth, personal relations, coping with stress and identity. There is a lot of skepticism about these self-help books. Some claim that they provide false hope or even do harm. Yet there are also reasons to expect positive effects from reading such books. One reason is that the messages fit fairly well with observed conditions for happiness and another reason is that such books may encourage active coping. There is also evidence for the effectiveness of bibliotherapy in the treatment of psychological disorders. The positive and negative consequences of self-help are a neglected subject in academic psychology. This is regrettable, because self-help books may be the most important–although not the most reliable–channel through which psychological insights find their way to the general audience.

Here is the full issue, of the Journal of Happiness Research, and I thank whichever web site led me to this, sorry I forget.

I like that word: bibliotherapy.

Best economics paper of 1958

Leonardo Monasterio asks:

Which paper/book should we celebrate its 50th year? Obviously, my vote goes to the paper that started the cliometric revolution:
The Economics of Slavery in the Ante Bellum South
Alfred H. Conrad, John R. Meyer
The Journal of Political Economy, Vol. 66, No. 2 (Apr., 1958), pp. 95-130
Is there any other contestant?

The two obvious competitors are Modigliani and Miller on financial irrelevance (AER) and Paul Samuelson on the overlapping generations model (JPE).  I’m inclined to put M-M first and Conrad and Meyer second.  Am I missing anything?  Don’t one or two of Schelling’s famous game theory articles date from this year as well?

Postwar American economics was splendid.  WWII meant that many thinkers (Friedman, Samuelson, Schelling, others) had real world experience with tackling big problems.  At the same time these people were just getting their hands on quantitative thinking and some more technical tools, yet the profession still valued breadth to some degree.

Who should be bounced from The Great Books series?

Before leaving for Japan, I’d been pawing through these volumes lately — you know, the U. Chicago fat tomes with two columns on each page?  The obvious question is which books belong and which do not; overall I’m surprised at how well the 1952 picks have held up and yes that is tribute to the University of Chicago or at least its influence.

I’m sad that Hume doesn’t get his own volume, including many of his shorter essays.  Plus I’d like to add Dickens’s Bleak House and at least the first two books of Proust.  And who to bounce?  I nominate Plotinus as the obvious choice, noting that he has only about 24,000 cites on, not even as many as Joseph Stiglitz.

In 1990 they dropped four books: Apollonius’ On Conic Sections, Laurence Sterne’s Tristram Shandy, Henry Fielding’s Tom Jones, and Joseph Fourier’s Analytical Theory of Heat.  The loss of Sterne is regretted but the others we can do without.  You’ll find a list of the added books in 1990 at the first link, about halfway down and yes they did include Swann’s WayLittle Dorrit is not the best or even the second best Dickens selection.  Most are good picks though I would have left the Bergson, the Dewey (unreadable), and tossed out some of the shorter works in favor of Ulysses.  More William James is never a bad idea; how about The Varieties of Religious Experience?  None of the science books will age well.  And how about a wee bit of Mises and Hayek to reflect the failures of socialism?  Absalom, Absalom would help cover race and maybe Mill on The Subjection of Women should be there too.

Why are books so outrageously expensive in Brazil?

That’s from a reader request.  I’m no expert on Brazil, but here are a few possibilities:

1. Most Brazilians do not read.  I don’t mean they can’t read, I mean they don’t read for leisure so much.  I was stuck at the Sao Paulo airport for seven hours and did not see a single person reading a book, not once.

Taking that as given, low demand means high prices.  That’s why Stephen King paperbacks are cheap and Edward Elgar (the name of an academic publisher) tomes go for $100 and up.

2. Brazilian retailing is not in every way efficient.  Efficient retailing in the traditional sense is, by the way, bad for the quality of your food because it means it is easy to serve large numbers.  And Brazil has some of the world’s best food, and so inefficient retailing for its books.

3. No other supply source is right nearby and the Portuguese language does not produce an extremely thick market.  Note that the Portuguese of Portugal is very different from the Portuguese of Brazil.

4. The Brazilian currency may be overvalued at the moment, at least in purchasing power parity terms, due to Brazil’s commodity exports.