Arnold Kling  

Influential Books

Oops. My Mistake... The Spread of Szaszian Economi...

Recently, Tyler Cowen listed the ten books that have influenced him the most. I have a much harder time coming up with such a long list. I am more inclined to list people (Tyler among them). But here goes:

1. David Halberstam, The Best and the Brightest. My take-away from that book might be described as "The Exclusive Country Club Theory." He makes foreign policy in the 1950's and early 1960's in the United States sound as if it was the province of an exclusive country club of people with a certain temperament and background. Wall Street lawyers, mostly. I have to say that I have carried this model with me for a long time. To this day, I view the relationship among Treasury, the Fed, the New York Fed, and large financial institutions in Exclusive Country Club terms. These people vet one another, agree with one another, and support one another. They do not question whether their interests coincide with those of the rest of the country--they just assume that the country depends on their institutions and their class leadership.

2. George Goodman, aka 'Adam Smith,' The Money Game and Supermoney. He was the Michael Lewis of his time--a great storyteller who also understood the substance of finance. I think his books still read well, although I could understand it if others find the stories themselves too dated. These books sparked my interest in finance theory and in the temptation to both believe and refuse to believe in efficient markets.

3. Carl Shapiro and Hal Varian, Information Rules. Again, you may find that the examples seem old, but no better book has been written on the economic issues of the information-driven economy. Among other things, this book convinced me that Price Discrimination Explains Everything.

4. Ray Kurzweil, The Age of Spiritual Machines. At first, I did not buy it. However, I have mostly come around. It is now possible to evaluate his predictions for 2009 (made around 1997). He did score with this one (p. 190):

Computers routinely include wireless technology to plug into the ever-present worldwide network, providing reliable, instantly available, very-high-bandwidth communication. Digital objects such as books, music albums, movies, and software are rapidly distributed as data files through the wireless network, and typically do not have a physical object associated with them.

However, for the most part, his predictions are far too aggressive. He was about right on hardware capability, somewhat optimistic on software capability (he thought that functions like language translation would be pretty much mastered by now), clearly too optimistic on the emergence of applications (he predicted computer-controlled cars on main highways by now) and ludicrously optimistic about the speed at which education and health care will be transformed by technology.

5. Amity Shlaes, The Forgotten Man. Folks on the left scorn this book, and it is not without its flaws. But ultimately, I think the left hates Shlaes not for what she gets wrong but what she gets right. What she gets right pokes huge holes in the high school book narrative of the Depression (Herbert Hoover sat back and did nothing, Roosevelt saved the economy). My takeaway from this book is the importance of the battle over historical narrative. We see that today in the determination of the left to blame the financial crisis entirely on "free-market ideology," even though that narrative is not such a good fit for the facts.

6. George Gilder, Microcosm. This was his history of the microprocessor. My guess is that it will not read well today, but at the time his emphasis on the relative unimportance of the materials in computers (he refers to silicon as "sand") stimulated me to focus on intangibles in the modern economy.

7. Thomas Sowell, The Vision of the Anointed. This book got me started thinking about the origins of the differences between the left and the right. I do not think anyone has fully satisfactory answers, but it is a fascinating question.

8. Amar Bhide, The Origin and Evolution of New Businesses. He breaks down the business ecosystem into two dimensions--degree of capital intensity and degree of ambiguity, and he gets remarkable mileage out of the resulting matrix.

9. Bill James, The Baseball Abstact, 1987. Others can be equally analytical about baseball. What is striking about Bill James is how well he wrote--when he cared. If only Amar Bhide wrote this well...

10. Ernest GrahamKenneth Grahame, The Wind in the Willows. The character of Toad is brilliantly drawn and offers great insights.

11. Neal Stephenson, The Diamond Age and Snow Crash. How I came to understand nanotechnology and competitive government, respectively.

Comments and Sharing

COMMENTS (13 to date)
Josh Weil writes:

This is an interesting list. I've never heard of any of these books. I'd be curious to see co-bloggers David and Bryan's book list as well.

Sam writes:

When I was ten or so my father gave me Adam Smith's (Goodman's) books Paper Money and The Roaring '80s.

One of the anecdotes was about a man named Kwartler who had lived frugally in an apartment and kept his savings in a bank, only to suffer from high inflation and taxes on his interest (vs. those who owned property, who received the mortgage tax subsidy and some capital-gains shielding).

When Goodman presented this story to a group of executives, 64 of 65 of them basically said that Kwartler was a chump.

Goodman ends the anecdote thus:

But if we continue to praise the debtors and think of the savers as chumps, we will in the long run not have a very agreeable society, or even one that survives in the form in which we now know it.
Tom Church writes:


What are your thoughts on Stephenson's Cryptonomicon? Maybe it changed the way you think about cryptanalysis?


Trent McBride writes:

Interesting list. also interesting: only one author appears in FPtP, a who's who of influential authors.

As an aside, I recently bought my mother, a liberal who I frequently discuss politics with, my all-time top 10. the list:

From Poverty to Prosperity, Kling/Schultz
The Future and Its Enemies, Postrel
Fair Play, Landsburg
Learning Economics, Kling
The Myth of the Rational Voter, Caplan
A Conflict of Visions, Sowell
It Ain't Necessarily So, Murray et al
In Defense of Global Capitalism, Norberg
How We Know What Isn't So, Gilovich
Spin Free Economics, Behravesh

A heavy econlog presence, as you can see. Thanks for the influence.

Les writes:

It would be easy to list all 10 books from just one author - Thomas Sowell.

fred hanson writes:

Halberstam, Snow Crash, and Wind In the Willows --nice to see such divergent thinking in an economist and blogger. Thanks

Dave writes:

Nice article. Love to see other's list. Made me think about what would be on my own list.

If the list includes what influenced you most over your entire life, I personally start with
The Rise and Fall of the Third Reich, which I read in high school and later in college. Maybe looking at the Nazi regime made me very skeptical of government at an early age and at demagoguery in a government with somewhat free elections.

Phil writes:

>"What is striking about Bill James is how well he wrote--when he cared."

Could you elaborate a bit?

Jim Ancona writes:

Great list! You might try Stephenson's Quicksilver series to see how that affects your understanding of monetary policy.


Paul Craddick writes:

Some of my favorites are arguably "libertarian," but in an older and, I would say, better sense than is currently connoted by that term.

Foremost amongst them would be lamentably neglected works by Bertrand De Jouvenel, especially:

On Power: A Natural History of its Growth (part 1 in the Power trilogy)
This work postulates a sort of oscillating social dynamic in History (in the same vein as De Tocqueville's sketch in the introduction to Democracy in America) - which, in some ironic respects, is corroborative of Marxist historiography. Paraphrasing (from memory), "Power is conservative in its being and revolutionary in its becoming." Rich in insights too numerous to summarize, a telling point made along the way is how modern "liberalism" is not in any way a consummation of (or even mere correction to) 19th Century Liberalism, but rather stands the old doctrine on its head (De Jouvenel is no cheerleader for the latter, by the way).


The Ethics of Redistribution
A minor classic. While some technical points in economics are considered - Paretian Welfare, for example - the work's primary aim, indeed, is to assess the redistributionist ethic. That is, while the style, tone, and arguments are not Randian, the animating concern is. As I believe the book's dust-jacket says by way of summary, in the end De Jouvenel concludes that the most salient aspect of redistributionism is less the (partial) despoiling of some for the benefit of others, and more the transfer of responsibility from individuals to the State. Aside from its intrinsic merits, this book is an effective cudgel contra the bluster of (modern) liberal economists, who, however formidable in the realm of technical economics, have - to say the least - no particular authority or insight when it comes to the morality of the policies they espouse.

Others of note:

The Economics of the Free Society by Wilhelm Roepke. It's a much more scholarly and comprehensive alternative to, say, Hazlitt's Economics in One Lesson. It provides an illuminating, clear statement of Marginal Utility and other foundational matters (viewed through a mostly "Austrian" lens), does not ignore the moral dimensions of the "free society," and offers much more besides (e.g., an extended critique of Keynes).

Capitalism, Socialism, and Democracy by Joseph Schumpeter. Tough to say anything which hasn't already been said about this one. One thing that I appreciate is its iconoclasm (ridicules Mt. Pelerin Society, denies Von Mises was right about the impossibility of rational economic calculation under Socialism, etc); peerless really.

ed_finnerty writes:

Interesting list - and the first one where i have read a majority of the list. Curious why you particularly picked the 1987 abstract. My favourite was the 1984 - but that may be because it was the first one I read. I particularly liked his explanation of why he didn't like "inside baseball", "Cliches are the soldiers of ignorance and the game is surrounded by an army of sentries". Also, in that issue he explained why talent was not normally distributed. Classic.

It may have been in 1987 when he was doing his player analysis and he wrote about a light hitting low on-base shortstop (can't remeber who - maybe Manny lee) who was rejecting a big contract offer and going out to free agency, "I don't know if this counts as chutzpah or chutzpidity" Was 1987 when he did his analysis of whether minor leaque stats predicted major league talent ? that was great

JustinM writes:

The Wind in the Willows is by Kenneth Grahame

Keith writes:

Another libertarian-minded sabermetrics fan? My heart is aflutter!

James' abstracts were a bit before my time. What really opened my eyes to sabermetrics was Moneyball, although that's not necessarily in the same 'genre' as James' stuff.

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