Best summer books of 2023: Economics

Power and Progress: Our Thousand Year Struggle over Technology and Prosperity by Daron Acemoglu and Simon Johnson (John Murray/PublicAffairs)

Technological progress does promise a better future. But it does not deliver one automatically. If the promise is to be achieved and costs contained, both the technology itself and, still more, its impact must be brought under social control. That finally happened, after bitter struggles, in the 19th and 20th centuries. It must be done all over again, argue the authors of this important book, if we are to reap the benefits and contain the costs of the new technologies of today and tomorrow.

A World of Insecurity: Democratic Disenchantment in Rich and Poor Countries by Pranab Bardhan (Harvard University Press)

This book is both ambitious and brief. It also makes an important contribution to the burgeoning literature on the erosion of democracy worldwide. Bardhan, professor emeritus at the University of California, Berkeley, argues that this is due to growing economic, social and cultural insecurity. This explains the desire to “take back control”, which so often emerges in the rightwing populism we now see across the world. The solution, he argues, is a renewal of social democracy.

Free and Equal: What Would a Fair Society Look Like? by Daniel Chandler (Allen Lane)

Chandler is an economist and philosopher at the London School of Economics. In this important book he has set out to use the radical ideas of John Rawls as a way to organise a society that is both free and fair. Rawls famously started by asking what sort of society we would choose if we did not know our place in it. Chandler starts from the same point and proceeds to build a blueprint for a better society. One does not have to agree with all of it to recognise that this is an important contribution.

Material World: A Substantial Story of Our Past and Future by Ed Conway (WH Allen)

We are material girls and boys. Not only are we made of stuff, we are entirely dependent on stuff. In this brilliant book, the journalist Conway explains what this has meant and continues to mean by looking at six vital materials: sand, salt, iron, copper, oil and, more recently, lithium. To extract and use these essential materials we also need energy, lots of it. Now we wish to replace the fossil fuels we rely upon with carbon-free alternatives. Conway explains the enormity of the revolution this will require.

The Economic Government of the World, 1933-2023 by Martin Daunton (Allen Lane)

In this ambitious and comprehensive book, Daunton traces out the history of the global economic order over a century. He explains the role of the US in shaping the ideology and institutions of the world economy from the Great Depression — via the Bretton Woods system, the Washington Consensus and the global financial crisis — to today’s renewed disorder. Ultimately, he shows, the global economic system is made and remade in response to the demands of politics, domestic and international.

Pricing the Priceless: The Financial Transformation to Value the Planet, Solve the Climate Crisis, and Protect Our Most Precious Assets by Paula DiPerna (Wiley)

Prices play an indispensable role in guiding any complex and decentralised economy. But how can they work if the most valuable things of all — the atmosphere, oceans and wildlife that protect, feed and delight us — remain unpriced? This is the challenge addressed by DiPerna’s book. Money must be made and compensation paid in return for preserving, not destroying, these uniquely valuable resources. A market economy that fails to do this cannot deliver genuine prosperity.

Building Tomorrow: Averting Environmental Crisis with a New Economic System by Paddy Le Flufy (First Light Books)

It is important to consider radical new ideas. Kate Raworth’s idea of “doughnut economics” was a good example. In this provocative book, Le Flufy builds on her ideas, along with those of the “circular economy” and “sovereign money” to design a new way of organising the economy. It is reasonable to doubt whether the transformation he recommends is feasible within a relevant time horizon. But it is also easy to see that environmental constraints must indeed be internalised within decentralised decision-making if planetary limits are to be respected.

Why Empires Fall: Rome, America and the Future of the West by Peter Heather and John Rapley (Allen Lane)

Western hegemony is in decline. So, how should the west deal with this new world, with a rising China and an increasingly independent periphery? The authors of this fascinating book argue that it was a question faced by an earlier western hegemonic power, the Roman empire. It collapsed. But what the west needs now is simple realism: it “cannot make itself great again in the old terms”. Instead, western powers must “get on with constructing the new, less self-aggrandising world order which would in fact defend their (and everyone else’s) interests more effectively”. Amen.

The Collapse of Antiquity: Greece and Rome as Civilization’s Oligarchic Turning Point by Michael Hudson (Islet)

This is Hudson’s second volume in a trilogy on the political economy of debt. The first, . . . and Forgive Them Their Debts, was on the ancient near-east in the bronze age. It discussed the role of debt forgiveness in stabilising ancient polities. In this one, Hudson explores the rise of the rentier oligarchies of classical Greece and Rome. Debt reduced the independent peasantry to penury and peonage and turned republics into despotisms. The final book will be on how debt is now poisoning our world.

The New China Playbook: Beyond Socialism and Capitalism by Keyu Jin (Swift/Viking)

Born and raised in Beijing, Jin is a professor at the London School of Economics. This makes her one of a small handful of professional economists who understand China from the inside. In this book, she writes that what we are watching in Xi Jinping’s China is the emergence of a “new playbook”. This playbook represents a search for a “new equilibrium”, which “involves striking a balance between greater equality and market incentives, security and growth, self-reliance and continued engagement with the West”.

Summer Books 2023

All this week, FT writers and critics share their favourites. Some highlights are:

Monday: Environment by Pilita Clark
Tuesday: Health and wellness by Anjana Ahuja
Wednesday: Fiction by Laura Battle
Thursday: Politics by Gideon Rachman
Friday: Critics’ picks
Saturday: History by Tony Barber

The Tyranny of Nostalgia: Half a Century of British Economic Decline by Russell Jones (London Publishing Partnership)

This depressing but fundamentally realistic book describes in persuasive detail the recurrent failures of British economic policy — the capriciousness and short-sightedness that led at long last to the decision, as ridiculous as it was absurd, to leave the EU. Behind these failures, suggests the author, lies a persistent tendency to ignore the realities of the country’s situation and the choices that need to be made if the long slide is to be halted.

Pursued Economy: Understanding and Overcoming the Challenging New Realities for Advanced Economies by Richard C Koo (Wiley)

Koo has been the most original thinker in macroeconomics of the past two decades. The fact that so few people recognise this is a tragedy and a scandal. At the heart of his ideas is the role of balance sheets. In this book, he complements the idea of the “balance sheet recession” articulated in his 2008 book The Holy Grail of Macroeconomics, with the idea of the “pursued economy”, in which the fundamental problem of rich countries is a lack of investment opportunities and consequent weakness in borrowing and demand.

We Need to Talk About Inflation: 14 Urgent Lessons from the Last 2,000 Years by Stephen D King (Yale)

Until recently, central banks were worried that inflation was too low. Now, they are worried about the opposite. Are they right to worry or is the upsurge of recent years still to be viewed optimistically, as a purely transitory phenomenon? In this historically informed and lucid book, King, senior economic adviser at HSBC, explains that the optimistic belief might indeed be true, but there is good reason to believe it is not. Above all, inflation is never truly dead. At best, it is sleeping.

Best Things First: The 12 Most Efficient Solutions for the World’s Poorest and Our Global SDG Promises by Bjorn Lomborg (Copenhagen Consensus Centre)

Lomborg is the essential provocateur, the person who declares that the emperors of global policy priorities too often wear no clothes. In this book, he offers an alternative: 12 policies that can be shown to generate extraordinarily large benefits and impose remarkably small costs. Focus then on tuberculosis, education, maternal and newborn health, agricultural research and development, malaria, e-procurement, nutrition, land tenure security, chronic diseases, child immunisation and skilled migration. Read. Be provoked. Enjoy.

India Is Broken: A People Betrayed, Independence to Today by Ashoka Mody (Stanford University Press)

Mody’s moral and intellectual courage is extraordinary. Not for him is the notion that India, now the world’s most populous country, is on the path to shared prosperity and stable democracy. Instead, he sees a distorted economy and a failing polity. “The grim reality,” he asserts, “is that to employ all working-age Indians, the economy needs to create 200mn jobs over the next decade, an impossible order after the past decade of declining employment numbers.” This book is a valuable corrective.

My Journeys in Economic Theory by Edmund Phelps (Columbia University Press)

In this enchanting book, Phelps, winner of the Nobel memorial prize in economics for his contributions to macroeconomics, recounts his life as an original thinker. Phelps is that rare thing nowadays, an economist who is also both a moralist and a true intellectual. This is what has made his contributions so significant: he is thinking new things and also important and uplifting things, most recently how innovation is an essential part of the good life.

The Power of Money: How Governments and Banks Create Money and Help Us All Prosper by Paul Sheard (Matt Holt Books)

Sheard, former vice-chair of S&P Global, explains that much of what is conventionally thought about money and monetary policy is wrong: governments do not run out of money, but demand may exceed available resources; banks do not intermediate money, but create it; monetary and fiscal policies are not independent, but are joined at the hip; and cryptocurrencies do not serve the functions of money, but are speculative assets. The book is that rare combination: both sensible and provocative.

Martin Wolf is the FT’s chief economics commentator

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