ECONOMICS FOR THE COMMON GOOD

Jean Tirole won the Nobel Prize in Economics in 2014, which is probably as good a reason as any to check out his book, Economics for the Common Good. I know it was my reason.

Here are three thoughts on the book:

1) The best part is that Tirole masterfully articulates what most students of the field know by heart: that economics is ultimately all about the incentives that prompt agents to act. Therefore, to harness economics for the common good entails being very deliberate about the incentives we use to bring about the behavior we would like to encourage.

2) The chapters devoted to specific economic problems, such as competition policy or environmental economics, are arguably where Tirole is clearly in his element. He explores the various issues from a multifaceted perspective, applying the rigor of economic analysis without invoking mathematical formulae or overly esoteric jargon. The result is a substantial discussion of each topic that brings to light their complexity and the challenge of bringing public policy or collective action to bear to address societal problems.

3) It's difficult to determine who the book is for, exactly. The treatment is arguably more advanced than your typical "Econ 101" fare–even the preliminary section that serves as an introduction is more complex that what you would expect from an introductory discussion of the "What is economics?" variety–while the specific topics discussed by Tirole are too varied to be bound by any specific overarching point and also too concise as to be a comprehensive account of any one individual issue.

In all, Economics for the Common Good is perhaps best described thus: a book written by a Nobel Prize-winning that is scholarly without necessarily being pedantic. It's a collection of writings on economics in general as well as specific topics in the field without any overarching theme or argument other than the simple point that the key to understanding economics is to appreciate what incentives are at play to influence behavior.

The author is a Nobel prize-winner in economics and has developed what is described as a ‘bold new agenda for the role of economics in society’. It may appear to many to be a dry, focussed read but it is capable of being transformative and valuable, propelling the science of economics to a visible, proactive force for good.

The author seeks to engage with the challenges that society is facing, utilising the power of economics to identify and action challenges. The objective is a ‘call-to-arms’, a manifesto for future change – as delivered through the book. It made for an interesting read, considering broader issues such as digital change, innovation, economic systems and financial order. It is a book for thinking about, rather than a guide to economics per se, yet it is very giving and accessible.

Nothing is unchallenged. Do we really have the best economic system and the best implementation for its operation? Could more be done? Is political control and will sufficient? Do we place our trust in an economic system that perhaps cannot be wholly trusted? All this and more come out in this massive book. It is something you really need to read in a quiet place, taking time to enjoy a sequential read and consider the messages being proffered. Of course, you can short-circuit the book, but do that at your own risk and fear of losing out!

Naturally, the author’s own personal views are featured heavily and no apology is made for this. The author is clear that there are no pre-determined answers and desires that the reader uses the book as a tool for questioning and thought generation. It is not a given that you will agree with everything and that can be good too. Diversity in opinion and thought is to be encouraged as that can make for stronger decision-making and adherence on a meta-level.

This can be a utopia for economics and politics nerds. Curious generalists can enjoy it too. It is deceptively clear and engaging for what you are getting and manages to service both audiences well. The chapters are quite short and broken down into sections and this aids the digestive process. The price may place it out of reach of some casual readers, but it is not an unreasonable price when its contents are considered.

Economics for the Common Good, written by Jean Tirole and published by Princeton University Press. ISBN 9780691175164. YYYYY