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Reading list: Best books for the first acquaintance with the economy pt. 2 (March 2022)

Who doesn’t want to be rich? In this world, such people are a priori few. It’s all about building a world where everything depends or is directly related to money, wealth. A person who earns little lives poorly. Conversely, people with high incomes can afford a lot: it’s a luxurious life, all the newest and best material goods. And also interest from other people, fame, and everything connected with it.

Yes, to be wealthy, you have to work hard. But not always! If you know how to manage capital, it will not be difficult to increase it. As many billionaires say: “It is difficult to earn the first million. Then everything goes like clockwork …”. So that everything is good in your financial field, we suggest reading the best books on economics and finance. Materials with tips, practices, strategies, and many other things, taking them fully armed, you can achieve significant success in business, banking, and investing.

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Reading list: Best books for the first acquaintance with the economy pt. 2 (March 2022) 5

Daron Acemoglu and James Robinson. «Why Nations Fail» . See it here on Amazon.

To the question about the reasons for the wealth of some peoples (to which Adam Smith was asked in his opus magnum), a final answer has not yet been received. Moreover, the diverse examples of “economic miracles” (Singapore, Taiwan, Japan) and “economic disasters” (Argentina, Zimbabwe, Greece) of the 20th-century call into question the existence of a single answer that would be true for all countries.

Two well-known American economists in their book carefully analyze almost all factors that can influence the economic development of countries (in particular, geographical location, availability of natural resources, cultural characteristics), and offer their answer. According to Acemoglu and Robinson, the prosperity or poverty of countries is determined by economic and political institutions – the “rules of the game” in the interaction between government and society.

This serious work, based on many studies and scientific articles by the authors themselves, is very popular and easily written and designed for the general reader.

Sylvia Nasar. «Grand Pursuit: The Story of Economic Genius». Find it here.

Columbia University business journalism professor Sylvia Nazar is best known for her book “A Beautiful Mind. The Life of Mathematical Genius and Nobel Laureate John Nash”, where the biography of mathematician and economist John Forbes Nash was told in parallel with a simple and accurate presentation of his scientific research – and according to which was filmed the Oscar-winning film A Beautiful Mind.

In her next book, Nazar tackles an even more difficult task – to show the development of economics during the 19th and 20th centuries through the prism of the biographies and views of prominent economists (from Alfred Marshall and Joseph Schumpeter to Milton Friedman and Paul Samuelson). From this highly entertaining, though not controversial, account of how economic theories promote economic development, one can learn how thorny the path to the great goal of transforming the lives of all people on the planet for the better.

Terry Pratchett. «Making Money». See it here.

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This is not an economic work, but a fantasy novel from the Discworld series, but in between, it raises the question of what money is, to which economists still do not know a definite answer.

Pratchett’s novel, firstly, plays on a real-life hydraulic model of the economy: his hero is the creator of Bulker, a computer that is a model of the national economy:

“… The flow of cash flows, their impact on society are modeled by water flows inside a glass matrix, which is Bulker. The geometric shape of the tubes, the operation of the valves, the ingenious, as I call them, pipettes and carefully calibrated pumps allow Bulker to imitate the most complex transactions. In addition, we can vary the initial conditions widely in order to explore the inherent properties of the system. For example, with the help of “Bulker”, you can find out what will happen if the labor force of the city is halved. To do this, it is enough to readjust a few valves, instead of running out into the street and killing people.”

Irving Fisher built mechanisms that reproduced real economies and in which the role of cash flow was played by the flow of water as early as the end of the 19th century, and the hydraulic computer MONIAC ​​by Alban William Phillips was most famous, modeling the British economy. Moreover, this novel ideally shows some of the provisions of different theories of money, including diametrically opposed ideas about what money is.

Tim Harford. «The Undercover Economist». Buy it here.

As properly noted in one of the reviews about this book, this is a bright representative of the works from the series “not boring about serious” and “just about complex”. Harford explains many important economic ideas in an entertaining and accessible way, using phenomena that everyone encounters in everyday life as a starting point for his observations.

Thus, using the example of the price of a cup of coffee, it is discussed how and what in the real economy is affected by the scarcity of resources (and very different types of resources – the price of a cup of coffee is last determined by the price of coffee beans and the work of a barista), and a simple trip to the supermarket shows how in practice, price discrimination of buyers is carried out – and this is not always bad, as one might think if we proceed only from the term.

In this book, you will learn what information the price of a product contains and how to properly dispose of it, what can happen if the seller and buyer have different information, how auction theory works, and why the US government bailed out 100 times at an auction for the sale of mobile licenses less than planned, and the British government managed to bail out 10 times more than it expected, and much more.

By the way, in 2014 this book had an equally exciting sequel: “The Undercover Economist Strikes Back. How to Build — or Ruin — an Economy” (“The Undercover Economist Strikes Back: How to Run — or Ruin — an Economy”).

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Reading list: Best books for the first acquaintance with the economy pt. 2 (March 2022) 7

Ha-Joon Chang. «Economics: The User’s Guide». Available here.

In his previous book, “23 Things They Don’t Tell You About Capitalism”, a professor of economics at Cambridge, explains that 95% of economics is common sense.

This book is written from the same positions: it briefly and very clearly outlines the stages of development of capitalism (from 1500 to the present day), discusses the main concepts and terms that economists use (gross domestic product and gross national product, sustainable economic growth, unemployment, inequality and poverty), describes the features of various schools of economic thought (from Austrian and Marxist to neoclassical and Keynesian ), and analyzes the role of the state and the market in the economy.

This book can be an excellent starting point for the study of economics, an addition to any textbook on macroeconomics or a reference book on the history of economic thought.

Robert Pindyck, Daniel Rubinfeld. «Microeconomics». Available here.

The difference between the two parts of economic theory (macroeconomics and microeconomics) is sometimes ironically explained as follows: microeconomics is a coherent, carefully developed science-based on serious mathematical apparatus, but capable of explaining only those things that have nothing to do with the real world, and macroeconomics deals with describing what is usually meant by “real economy”, only at the same time in macroeconomics there are a large number of different schools, representatives of which give opposite forecasts and answers to the same question.

It is all the more remarkable that the textbook by Pindike and Rabinfeld explains basic microeconomic concepts without requiring the reader to develop the advanced mathematical technique that is usually needed to read microeconomic textbooks. Practically without mathematical formulas, the authors tell and clearly show (in the list of trademarks and firms given as an example, there are more than 50 names, from Airbus to Wal-Mart), how the economy is working at the level of the individual market, why and how people and firms negotiate and interact with each other, including under conditions of uncertainty and asymmetric information.

N. Gregory Mankiw. «Principles of Economics». Buy it here.

Now a classic, Mankiw is rightfully considered one of the most successful textbooks in economics, teaching, above all, the way to think and ask questions like an economist. You cannot find many specialized models presented in it, mathematical methods are practically not used, but a very big number of cases from various areas of life are analyzed in this book, which makes it simple and interesting to read. But its main advantage is the widest possible coverage of topics.

“Principles of Economics” includes not only the foundations of fundamental economic theory (microeconomics, that is, the principles of operation of individual markets, and macroeconomics – the behavior of GDP and prices in the short and long term), but also the elements of the theory of international trade, the theory of industrial organization ( behavior of firms), public sector economics, and financial analysis—subjects on which separate thick textbooks have been written.

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