Free lunch

David Smith

Why I looked at this book

I'm interested in economics and read quite a few books on the subject, but I sometimes feel that there are basic things I should understand better. What is the difference between fiscal and monetary policies? Can I understand what Marx actually said without ploughing through all of his work? I'm hoping that this book will enlighten me on such issues.

First impressions

Smith starts by explaining that when the first edition of this book came out, its purpose was to introduce economics to a public which didn't necessarily have that much interest in the subject. Following the financial crisis there's a lot more interest in economic matters, and he hopes that the book will help inform readers about the economic concepts they hear about. He starts with a look at that ever-popular subject: house prices, explaining why we take much more interest in the price of houses than, say, the price of potatoes.

So far the book has been easy to follow and I'm hoping for an entertaining and informative read.

Main review

I had a sharp intake of breath when Smith described vacuuming the house as a 'leisure activity'. I'm sure that if this is what he really thinks then there'll be plenty of people willing to offer him this sort of leisure. I think, though. that it's more a case of him temporarily taking his eye off the ball, as later he discusses the nature of housework and whether it should be included in calculations of GDP.

The book gives a reasonably comprehensive introduction to economic concepts, with chapters on Adam Smith, Marx and Keynes as well as nineteenth century classical economists and a number of 20th century American economists. In between there are discussions of GDP, of taxation, of the nature of money and quite a bit more. The book finishes off with a look at the recent economic crisis.

I do have my reservations about the book though. With some meals you find you're hungry again after a couple of hours, and with this book I noticed I wasn't particularly motivated to go back to it to refer to what had been discussed. Indeed, it isn't easy to do this if you don't remember, for instance, that the discussion of international trade was in the chapter entitled 'arguing over coffee'. The vacuuming bit was the only part I really remembered after reading it.

It is easy to read and I would recommend it to those wanting a quick overview of economics, but I would think that you need to go further to get a substantial introduction to economic concepts.
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In 1930, John Maynard Keynes wrote Economic Possibilities for our Grandchildren, predicting an age of leisure in a couple of generations. Why aren't we there yet? That's just one of the questions asked in
The People's Economics