6 ms·

What are the best introductory books to get more grounded in economics

aww_dang 6y ago
https://www.goodreads.com/book/show/3028.Economics_in_One_Lesson https://www.goodreads.com/book/show/3028.Economics_in_One_Le...
Jommi 6y ago
https://www.amazon.com/Macroeconomics-N-Gregory-Mankiw/dp/1464182892 https://www.amazon.com/Macroeconomics-N-Gregory-Mankiw/dp/14...
jkhdigital 6y ago
https://www.amazon.com/Basic-Economics-Thomas-Sowell/dp/0465060730/ https://www.amazon.com/Basic-Economics-Thomas-Sowell/dp/0465... https://www.amazon.com/Applied-Economics-Thinking-Revised-Enlarged/dp/B004HOVCKW/ https://www.amazon.com/Applied-Economics-Thinking-Revised-En...
neilwilson 6y ago
If you want actual Macroeconomics rather than the myths from this article try https://www.amazon.com/Macroeconomics-William-Mitchell/dp/1137610662/ref=sr_1_1?dchild=1&keywords=macroeconomics+mitchell&qid=1614058316&s=books&sr=1-1 https://www.amazon.com/Macroeconomics-William-Mitchell/dp/11...
- huitzitziltzin 6y ago
  This is not a good recommendation. Wray and the MMT school have a bizarre set of views which are wildly outside the mainstream of macroeconomic thinking. Moreover, when serious macroeconomists have tried to engage with MMT on its own terms (which they do!) the MMT people always get evasive and vague in response to the very simple question: “why didn’t your monetary ideas work for Venezuela/Zimbabwe/Weimar Germany?” There are much better textbooks available. Wolfers/Stephenson is a recent one I’ve thought about using in class.
  - neilwilson 6y ago
    "“why didn’t your monetary ideas work for Venezuela/Zimbabwe/Weimar Germany?”" What a bizarre response. They weren't even attempted there as the literature shows. https://gimms.org.uk/2020/11/14/weimar-republic-hyperinflation-through-a-modern-monetary-theory-lens/ https://gimms.org.uk/2020/11/14/weimar-republic-hyperinflati... Presumably you also believe heavier than air flight is theoretically impossible because bad pilots crash planes.
    - huitzitziltzin 6y ago
      The MMT claim, as far as any normal economist understands it, is that the government can print money indefinitely to pay for whatever it wants, because of a somewhat counterintuitive claim about the government being able to insist that people pay taxes in the currency it designates. As I said, it's really hard to get MMT people to sit down and describe exactly what they are claiming, b/c they have to face up to these counterexamples. Like: "why couldn't Venezuela print money indefinitely to pay for what it wants?" To which the MMT response is some version of: "Well, I didn't mean that!" Well ok - WHAT did you mean? They are always slippery and evasive (at best) about what they do mean. They do not engage with conventional macroeconomists for the most part. And that's not because conventional macroeconomists don't try to engage with them! If it were possible to do what they propose, that would be amazing! You would have wide agreement on that within the profession. I share many of their political goals - I'm on the left too. But I don't see how it is remotely possible to achieve the goals they propose in the manner they suggest.
      - notahacker 6y ago
        tbf MMT does have an explanation for Venezuela, Zimbabwe and the Weimar Republic (supply constraints). This isn't by itself implausible, but their overall inflation model is very handwavy. I can buy "job guarantee could act as an endogenous stabiliser if the proportion funded by new currency issue is calibrated correctly" but not "the existence of a buffer stock of labour compensated by a JG means that we don't need to consider printing less or making credit more expensive as if prices rise firms could always hire from this pool" which seems to be the preferred version But yes, they seem to be preferring to talk past rather than engage with mainstream macroeconomists. The sheer rhetorical effort they devote to convincing their readers the money multiplier is the wrong foundation that underpins all modern macro and not a simple pedagogic device for explaining how leverage works and why deposit insurance became a thing....
The_Amp_Walrus 6y ago
You can watch online course videos created by the article author: https://mru.org/ https://mru.org/ They're very high quality
kqr 6y ago
I personally think a lot of established macroeconomics is bullshit. There's just no mechanism to verify many of the hypotheses, and practitioners rarely suffer from the kind of personal survival pressure that otherwise tends to filter out for people who are right. Not to mention that the entire economy is such a complex system, and my experience with complex systems is that we can't predict them, we like to come up with causal explanations for observed events, and we're almost always wrong on closer scrutiny. With all that in mind, I have started my economics journey not on the macro picture, but on the details. Book recommendations include: - The Kelly capital investment criterion: a collection of historic peer-reviewed papers about what it says on the tin: how to allocate resources to risky ventures (read: how to size bets.) - Red-Blooded Risk: a wandering tale about quantitative risk management and how it entered the world of finance in the seventies--eighties. As always with Aaron Brown, it contains lots of information on economic matters that aren't directly related to the main subject. - The Economic Function of Futures Markets: a correct, for once, exposition on how futures markets are not about locking in prices (any regular contract can do that) or hedging (the people who supposedly would hedge don't) but about creating an implicit loan market for commodities, among other things. - The Poker Face of Wall Street: a wandering tale on the similarities between betting, speculation in financial instruments, and insurance, among other things. - The (Mis)Behaviour of Markets: Benoit Mandelbrot summarises some of his research into modeling markets with multifractal geometric ideas. - Fortune's Formula: a more pop-sci friendly version of the Kelly criterion paper collection. - Regression Modeling with Financial and Actuarial Applications: basic techniques used everywhere for statistical modeling of things. - Moneyball: finding not the best, but the most undervalued through quantitative reasoning. - Inadequate Equilibria: a framework for thinking about when economic incentives align with a desired outcome and when they don't. I have also started a fairly advanced prediction market at work to get a better sense for how such things work, and I'm the guy who you either love or hate playing Risk and Monopoly with, because I invent derivative money and all sorts of exotic contracts as an aid to diplomacy. But then again, I generally build knowledge by generalizing from specific concrete experiences. Maybe that bottom-up approach works badly for some people. Edit: I should say that these are some of the books I have read and can personally vouch for. There are several more like them in my stack of books to read. I can list some of those that I think are more promising, but I can't personally vouch for them yet. Second edit: oh, I almost forgot some of the most important parts. I don't have a specific reference, but double-entry accounting and financial reports are things that will teach you a lot of the basic terminology about assets, liabilities, equity, credit and so on. I suggest maintaining your personal (or your family's) books with double-entry. A great pplace to start is Plain Text Accounting.
ctchocula 6y ago
For a solid intro to economics, I found a real gem of a suggestion by an econ professor at UC Berkeley [1], so I'll share with you. His advice is to start from the father of economics himself, Adam Smith. Then follow that up with Das Kapital (which I know is an unpopular stance here on HN) and some Keynes (who is credited with coming up with the economic theory that helped bring the UK and US out of the Great Depression). Here's a snippet of Prof. DeLong's advice: > We have our recommended ten-stage process for reading such big books: 1. Figure out beforehand what the author is trying to accomplish in the book. 2. Orient yourself by becoming the kind of reader the book is directed at—the kind of person with whom the arguments would resonate. 3. Read through the book actively, taking notes. 4. “Steelman” the argument, reworking it so that you find it as convincing and clear as you can possibly make it. 5. Find someone else—usually a roommate—and bore them to death by making them listen to you set out your “steelmanned” version of the argument. 6. Go back over the book again, giving it a sympathetic but not credulous reading. 7. Then you will be in a good position to figure out what the weak points of this strongest-possible argument version might be. 8. Test the major assertions and interpretations against reality: do they actually make sense of and in the context of the world as it truly is? 9. Decide what you think of the whole. 10. Then comes the task of cementing your interpretation, your reading, into your mind so that it becomes part of your intellectual panoply for the future. > Follow this process, and your reading becomes active. Then you have the greatest possible chance of learning the books—of thereafter being able to summon up sub-Turing instantiations of the thinkers Adam Smith, Karl Marx, and John Maynard Keynes and then running them on your wetware. If you can do that, you can be closer to being as smart as they were. And at the same time you will be aware enough of their weak points and blindnesses that you can be wiser than they were. [1] https://www.bradford-delong.com/2019/12/a-note-on-reading-big-difficult-books.html https://www.bradford-delong.com/2019/12/a-note-on-reading-bi...
- prox 6y ago
  I recently started in the book “The value of everything” , and it’s the first book to give me a solid understanding from the early theories and it’s working its way to today. Especially the decomposition of where the theories differ is enlightening. I just arrived at marginal utility theory. It explains it far better than all the classes I had in economics.
throwaway34241 6y ago
I have a textbook by Mankiw (one of the other comments here also recommends him) and it seems pretty good. I particularly like how it points out in which areas there is consensus or disagreement between professional economists and the various sides of the debate. It's expensive new but if you hunt around you can get used editions fairly reasonably. I'd be aware that there are certain heterodox schools of economic thought that are much more popular among non-economists than economists, so it's probably worth trying to find something that presents opposing arguments and isn't too biased. Also, I don't know about his other stuff but Ray Dalio has some great material if you want a very quick, high level introduction to some macroeconomic concepts that doesn't have much jargon. In particular I remember the introductory video at: https://economicprinciples.org/ https://economicprinciples.org/ being pretty good. I also liked his free book on debt crises since it breaks down the macroeconomic situation in various country/time periods (inflation, government/private debt, etc) which I thought was more interesting than reading about some of those things in abstract (I also don't remember it being very jargon-heavy).
viburnum 6y ago
“The Worldly Philosohers” is very good. Economics is full of controversies and contested ideas so it’s best to take them head on rather than pretending it’s physics. If you’re looking for a textbook, this is the best (it’s also free): https://www.core-econ.org/the-economy/book/text/0-3-contents.html https://www.core-econ.org/the-economy/book/text/0-3-contents...
- humpydumpy 6y ago
  Somehow I can never take somebody seriously who says "this is the best". How can you know it is the best book? Have you literally read all of them and can thus compare them? If not, how can you be sure? Is there even such a thing as a best book? Different people have different backgrounds, learn in different ways, like different things. Why would there not be multiple "best" books? Reminds me of a guy I once met, who told me that "this is the best bakery in the city" (>1.5e6 inhabitants). Interestingly, the city's best bakery was just around the corner of his appartment. Once he moved to a different appartment in 10min walking distance, he never went back to the best bakery. He found out that the bakeries closer to his new appartment were at least equally good...
  - viburnum 6y ago
    There aren’t that many econ textbooks. The others are all trying to do the same thing, stuck in the past in different ways.
oli5679 6y ago
The undercover economist - Tim Hartford The accidental theorist - Paul Krugman Or if you want a textbook, Mankiw is pretty good.
prox 6y ago
I am well underway in the book “The value of everything” , it’s thorough but accessible and starts from the beginning and shows how theories evolved.
cambalache 6y ago
Buy a cheap, used macro/micro book (Krugman or similar) Buy and read,23 Things They Don't Tell You About Capitalism, by Ha-Joon Chang. All his books are recommended for a reasonable criticism of mainstream economics.

https://www.goodreads.com/book/show/3028.Economics_in_One_Lesson https://www.goodreads.com/book/show/3028.Economics_in_One_Le...

Jommi 6y ago

https://www.amazon.com/Macroeconomics-N-Gregory-Mankiw/dp/1464182892 https://www.amazon.com/Macroeconomics-N-Gregory-Mankiw/dp/14...

jkhdigital 6y ago

https://www.amazon.com/Basic-Economics-Thomas-Sowell/dp/0465060730/ https://www.amazon.com/Basic-Economics-Thomas-Sowell/dp/0465... https://www.amazon.com/Applied-Economics-Thinking-Revised-Enlarged/dp/B004HOVCKW/ https://www.amazon.com/Applied-Economics-Thinking-Revised-En...

neilwilson 6y ago

If you want actual Macroeconomics rather than the myths from this article try https://www.amazon.com/Macroeconomics-William-Mitchell/dp/1137610662/ref=sr_1_1?dchild=1&keywords=macroeconomics+mitchell&qid=1614058316&s=books&sr=1-1 https://www.amazon.com/Macroeconomics-William-Mitchell/dp/11...

huitzitziltzin 6y ago
This is not a good recommendation. Wray and the MMT school have a bizarre set of views which are wildly outside the mainstream of macroeconomic thinking. Moreover, when serious macroeconomists have tried to engage with MMT on its own terms (which they do!) the MMT people always get evasive and vague in response to the very simple question: “why didn’t your monetary ideas work for Venezuela/Zimbabwe/Weimar Germany?” There are much better textbooks available. Wolfers/Stephenson is a recent one I’ve thought about using in class.
- neilwilson 6y ago
  "“why didn’t your monetary ideas work for Venezuela/Zimbabwe/Weimar Germany?”" What a bizarre response. They weren't even attempted there as the literature shows. https://gimms.org.uk/2020/11/14/weimar-republic-hyperinflation-through-a-modern-monetary-theory-lens/ https://gimms.org.uk/2020/11/14/weimar-republic-hyperinflati... Presumably you also believe heavier than air flight is theoretically impossible because bad pilots crash planes.
  - huitzitziltzin 6y ago
    The MMT claim, as far as any normal economist understands it, is that the government can print money indefinitely to pay for whatever it wants, because of a somewhat counterintuitive claim about the government being able to insist that people pay taxes in the currency it designates. As I said, it's really hard to get MMT people to sit down and describe exactly what they are claiming, b/c they have to face up to these counterexamples. Like: "why couldn't Venezuela print money indefinitely to pay for what it wants?" To which the MMT response is some version of: "Well, I didn't mean that!" Well ok - WHAT did you mean? They are always slippery and evasive (at best) about what they do mean. They do not engage with conventional macroeconomists for the most part. And that's not because conventional macroeconomists don't try to engage with them! If it were possible to do what they propose, that would be amazing! You would have wide agreement on that within the profession. I share many of their political goals - I'm on the left too. But I don't see how it is remotely possible to achieve the goals they propose in the manner they suggest.
    - notahacker 6y ago
      tbf MMT does have an explanation for Venezuela, Zimbabwe and the Weimar Republic (supply constraints). This isn't by itself implausible, but their overall inflation model is very handwavy. I can buy "job guarantee could act as an endogenous stabiliser if the proportion funded by new currency issue is calibrated correctly" but not "the existence of a buffer stock of labour compensated by a JG means that we don't need to consider printing less or making credit more expensive as if prices rise firms could always hire from this pool" which seems to be the preferred version But yes, they seem to be preferring to talk past rather than engage with mainstream macroeconomists. The sheer rhetorical effort they devote to convincing their readers the money multiplier is the wrong foundation that underpins all modern macro and not a simple pedagogic device for explaining how leverage works and why deposit insurance became a thing....

The_Amp_Walrus 6y ago

You can watch online course videos created by the article author: https://mru.org/ https://mru.org/ They're very high quality

kqr 6y ago

I personally think a lot of established macroeconomics is bullshit. There's just no mechanism to verify many of the hypotheses, and practitioners rarely suffer from the kind of personal survival pressure that otherwise tends to filter out for people who are right. Not to mention that the entire economy is such a complex system, and my experience with complex systems is that we can't predict them, we like to come up with causal explanations for observed events, and we're almost always wrong on closer scrutiny. With all that in mind, I have started my economics journey not on the macro picture, but on the details. Book recommendations include: - The Kelly capital investment criterion: a collection of historic peer-reviewed papers about what it says on the tin: how to allocate resources to risky ventures (read: how to size bets.) - Red-Blooded Risk: a wandering tale about quantitative risk management and how it entered the world of finance in the seventies--eighties. As always with Aaron Brown, it contains lots of information on economic matters that aren't directly related to the main subject. - The Economic Function of Futures Markets: a correct, for once, exposition on how futures markets are not about locking in prices (any regular contract can do that) or hedging (the people who supposedly would hedge don't) but about creating an implicit loan market for commodities, among other things. - The Poker Face of Wall Street: a wandering tale on the similarities between betting, speculation in financial instruments, and insurance, among other things. - The (Mis)Behaviour of Markets: Benoit Mandelbrot summarises some of his research into modeling markets with multifractal geometric ideas. - Fortune's Formula: a more pop-sci friendly version of the Kelly criterion paper collection. - Regression Modeling with Financial and Actuarial Applications: basic techniques used everywhere for statistical modeling of things. - Moneyball: finding not the best, but the most undervalued through quantitative reasoning. - Inadequate Equilibria: a framework for thinking about when economic incentives align with a desired outcome and when they don't. I have also started a fairly advanced prediction market at work to get a better sense for how such things work, and I'm the guy who you either love or hate playing Risk and Monopoly with, because I invent derivative money and all sorts of exotic contracts as an aid to diplomacy. But then again, I generally build knowledge by generalizing from specific concrete experiences. Maybe that bottom-up approach works badly for some people. Edit: I should say that these are some of the books I have read and can personally vouch for. There are several more like them in my stack of books to read. I can list some of those that I think are more promising, but I can't personally vouch for them yet. Second edit: oh, I almost forgot some of the most important parts. I don't have a specific reference, but double-entry accounting and financial reports are things that will teach you a lot of the basic terminology about assets, liabilities, equity, credit and so on. I suggest maintaining your personal (or your family's) books with double-entry. A great pplace to start is Plain Text Accounting.

ctchocula 6y ago

For a solid intro to economics, I found a real gem of a suggestion by an econ professor at UC Berkeley [1], so I'll share with you. His advice is to start from the father of economics himself, Adam Smith. Then follow that up with Das Kapital (which I know is an unpopular stance here on HN) and some Keynes (who is credited with coming up with the economic theory that helped bring the UK and US out of the Great Depression). Here's a snippet of Prof. DeLong's advice: > We have our recommended ten-stage process for reading such big books: 1. Figure out beforehand what the author is trying to accomplish in the book. 2. Orient yourself by becoming the kind of reader the book is directed at—the kind of person with whom the arguments would resonate. 3. Read through the book actively, taking notes. 4. “Steelman” the argument, reworking it so that you find it as convincing and clear as you can possibly make it. 5. Find someone else—usually a roommate—and bore them to death by making them listen to you set out your “steelmanned” version of the argument. 6. Go back over the book again, giving it a sympathetic but not credulous reading. 7. Then you will be in a good position to figure out what the weak points of this strongest-possible argument version might be. 8. Test the major assertions and interpretations against reality: do they actually make sense of and in the context of the world as it truly is? 9. Decide what you think of the whole. 10. Then comes the task of cementing your interpretation, your reading, into your mind so that it becomes part of your intellectual panoply for the future. > Follow this process, and your reading becomes active. Then you have the greatest possible chance of learning the books—of thereafter being able to summon up sub-Turing instantiations of the thinkers Adam Smith, Karl Marx, and John Maynard Keynes and then running them on your wetware. If you can do that, you can be closer to being as smart as they were. And at the same time you will be aware enough of their weak points and blindnesses that you can be wiser than they were. [1] https://www.bradford-delong.com/2019/12/a-note-on-reading-big-difficult-books.html https://www.bradford-delong.com/2019/12/a-note-on-reading-bi...

prox 6y ago
I recently started in the book “The value of everything” , and it’s the first book to give me a solid understanding from the early theories and it’s working its way to today. Especially the decomposition of where the theories differ is enlightening. I just arrived at marginal utility theory. It explains it far better than all the classes I had in economics.

throwaway34241 6y ago

I have a textbook by Mankiw (one of the other comments here also recommends him) and it seems pretty good. I particularly like how it points out in which areas there is consensus or disagreement between professional economists and the various sides of the debate. It's expensive new but if you hunt around you can get used editions fairly reasonably. I'd be aware that there are certain heterodox schools of economic thought that are much more popular among non-economists than economists, so it's probably worth trying to find something that presents opposing arguments and isn't too biased. Also, I don't know about his other stuff but Ray Dalio has some great material if you want a very quick, high level introduction to some macroeconomic concepts that doesn't have much jargon. In particular I remember the introductory video at: https://economicprinciples.org/ https://economicprinciples.org/ being pretty good. I also liked his free book on debt crises since it breaks down the macroeconomic situation in various country/time periods (inflation, government/private debt, etc) which I thought was more interesting than reading about some of those things in abstract (I also don't remember it being very jargon-heavy).

viburnum 6y ago

“The Worldly Philosohers” is very good. Economics is full of controversies and contested ideas so it’s best to take them head on rather than pretending it’s physics. If you’re looking for a textbook, this is the best (it’s also free): https://www.core-econ.org/the-economy/book/text/0-3-contents.html https://www.core-econ.org/the-economy/book/text/0-3-contents...

humpydumpy 6y ago
Somehow I can never take somebody seriously who says "this is the best". How can you know it is the best book? Have you literally read all of them and can thus compare them? If not, how can you be sure? Is there even such a thing as a best book? Different people have different backgrounds, learn in different ways, like different things. Why would there not be multiple "best" books? Reminds me of a guy I once met, who told me that "this is the best bakery in the city" (>1.5e6 inhabitants). Interestingly, the city's best bakery was just around the corner of his appartment. Once he moved to a different appartment in 10min walking distance, he never went back to the best bakery. He found out that the bakeries closer to his new appartment were at least equally good...
- viburnum 6y ago
  There aren’t that many econ textbooks. The others are all trying to do the same thing, stuck in the past in different ways.

oli5679 6y ago

The undercover economist - Tim Hartford The accidental theorist - Paul Krugman Or if you want a textbook, Mankiw is pretty good.

prox 6y ago

I am well underway in the book “The value of everything” , it’s thorough but accessible and starts from the beginning and shows how theories evolved.

cambalache 6y ago

Buy a cheap, used macro/micro book (Krugman or similar) Buy and read,23 Things They Don't Tell You About Capitalism, by Ha-Joon Chang. All his books are recommended for a reasonable criticism of mainstream economics.