Wednesday, September 1, 2010

Review: Economics(2e), by Krugman and Wells

This one of many books I'm reading on my Kindle

The reason I got this book is because Krugman is a well-known liberal. He writes a blog for the New York Times called "Conscience of a Liberal". He is a mainstay on news and talk shows, refuting the evil right-wing economists. Having learned economics from evil right-wingers such as Greg Mankiw, I wondered how Krugman's textbook might be different.

The answer is: it's not. The content is almost identical between the "left-wing" and "right-wing" economic textbooks.

Take third-world sweatshops, for example. Everybody knows they are evil and should be stamped out. The only people that might be disagree are evil right-wing economists in the pay of the big corporations that exploit sweatshop labor.

That's not true, says Krugman. He describes this as the "sweatshop labor fallacy". His textbook goes on to show what every economics textbook shows: that sweatshops are good. This conclusion is based on the principles of economics, and is so persuasive, that most economists agrees, regardless of their politics.

And that's the story of economics. There is a lot that economists don't know, things left-wing and right-wing economists disagree about in their blogs (such as what to do about "stimulus spending"). On the other hand, there is a lot that economists do know, where they are in agreement, such as in the benefits of sweatshops.

If you are learning economics, it doesn't much matter if you learn from Mankiw (right-winger) or Krugman (left-winger). Their textbooks contain much the same content, devoid of politics. I'd probably prefer Mankiw, it seems slightly less "textbooky" and contains more real-world examples, such as news articles showing economics in action. But Krugman's book is also quite good, especially if you are a left-winger suspicious of right-wing bias.

If you are not learning economics, you should. Imagine you are having a discussion where the other person reveals that, contrary to all scientific evidence, they believe the Earth is only 10,000 years old. An uncomfortable silence follows. That's the way I feel, every time somebody brings up an economics issue, like sweatshops.

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