New Books in Economics

Of what use is history, particularly for economists and people in finance? If you’ve ever wondered about this, you should read Daniel Peris‘s book Getting Back to Business: Why Modern Portfolio Theory Fails Investors and How You Can Bring Common Sense to Your Portfolio (McGraw-Hill Education, 2018). Before he became a portfolio manager, Peris was a professional historian. He was trained as such, wrote books about such, and taught such. In Getting Back to Business, he brings his background in this regard to a little considered question: Why, historically speaking, do we invest money the way we do? The “we” here is your financial advisor and, if you invest your own money, you. And you use something called “Modern Portfolio Theory” or MPT. That theory—like any theory—has a history. It was created by particular people in a particular historical context for a specific historical purpose. It was a tool fit for that specific historical purpose. Peris masterfully traces how it was invented, disseminated, and eventually reached (pardon the expression) “market saturation” among financial advisors. It’s a fascinating story, really an intellectual-institutional history of modern investment thought. But Getting Back to Business more than an academic exercise because Peris is no longer an academic; he manages 20 billion dollars. And his historical exploration has led him to the conclusion that the tool we call “MPT” is no longer fit for purpose. It used to work, but times have changed (partly because of the widespread adoption of MPT itself) and it no longer does, at least in its standard form. Peris has some suggestions about how we might design a new tool, one better fit to modern conditions. This books is a rare beast: applied, relevant, meaningful, news-you-can-use history. Were that there were more books like it. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

Thomas Mulligan’s new book, Justice and the Meritocratic State (Routledge Press, 2018), posits a theory of justice that is based on the allocation of valuable goods (jobs and appropriate income) according to merit. This is an abstract concept that Mulligan details according to economic, philosophical, and political understandings. He weaves together the political and economic dimensions of meritocratic allocations and spends the latter part of the book noting policy ideas that can bring this abstract concept into being. In the process, Mulligan critiques contemporary concepts of justice, especially commenting on the 20th-century work by Robert Nozick, John Rawls, Leo Strauss, and post-modern philosophers. The argument made for meritocratic allocation of valuable goods is seen as a kind of third way between the limited nature of egalitarian theory on one side and libertarian theory on the other. The argument for “desert”-based justice also brings the ideal of the American dream into clearer focus in Mulligan’s analysis. His book explores this concept in great detail, clearing up what has been the murky nature of an understanding of what meritocracy really means. Throughout the book, Mulligan delves into concepts of meritocracy from classical authors like Socrates/Plato and Aristotle, as well as from eastern approaches. He explores the integration of an understanding of meritocratic governance and political power from Confucian political theory as well as from much of the western philosophical canon. This book spans a variety of disciplines, and may be of interest to political theorists, economists, philosophers, sociologists, and others. It is clearly written and takes the reader through not only the concept of meritocracy and desert-based justice, but also the role of economics in understanding justice, and, finally, the kinds of policy and rhetorical shifts that are necessary to more fully establish a meritocratic state. This podcast was hosted by Lilly Goren, Professor of Political Science and Global Studies at Carroll University in Waukesha, WI. You can follow her on Twitter @gorenlj Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

How can we end the scourge of poverty? How we can sustain ourselves once robots eliminate the need for many jobs? Annie Lowrey offers an answer in the title of her book, Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World (Crown, 2018). She makes the case for the policy called “Universal Basic Income,” in which the government pays everyone a fixed amount of money whether or not they have a job. The book traces the history of the idea, which goes back centuries and has been embraced at various points by people on the left and the right. Lowrey also shares her travels to Kenya, to witness a pilot UBI program, and to India, to explore its high-tech program to bring banking to the poor and could lead to a UBI system. She talks with politician and philosophers, economists and subsistence farmers. And she addresses critics who fear UBI would be too expensive and discourage work. As UBI becomes a hot topic in policy work circles, Give People Money will help you fully understand the idea and consider its profound implications. Bill Scher is a Contributing Editor for POLITICO Magazine. He has provided political commentary on CNN, NPR and MSNBC. He has been published in The New York Times, The New Republic, and The New York Daily News among other publications. He is author of Wait! Don’t Move to Canada, published by Rodale in 2006. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

We spoke with Ilene Grabel, Professor at the University of Denver and Co-director of the MA program in Global Finance, Trade & Economic Integration at the Josef Korbel School of International Studies. Ilene just published a very timely, interesting and important book on the evolution of the global financial governance and its institutions: When Things Don’t Fall Apart: Global Financial Governance and Developmental Finance in an Age of Productive Incoherence (MIT Press, 2017). In the foreword, Dani Rodrick from Harvard University defines the book as follows: “It happens only rarely and is all the more pleasurable because of it. You pick up a manuscript that fundamentally changes the way you look at certain things. This is one such book. Ilene Grabel has produced a daring and delightful reinterpretation of developments in global finance since the Asian financial crisis of 1997–1998.” The book is an account of the gradual, uneven, disconnected, ad hoc, and pragmatic innovations in global financial governance and developmental finance induced by the global financial crisis. In When Things Don’t Fall Apart, Ilene Grabel challenges the dominant view that the global financial crisis had little effect on the financial institutions. Most observers discount all but grand, systemic ruptures in institutions and policy. Grabel argues instead that the global crisis induced inconsistent and ad hoc discontinuities in global financial governance and developmental finance that are now having profound effects on emerging market and developing economies. Grabel’s chief normative claim is that the resulting incoherence in global financial governance is productive rather than debilitating. In the age of productive incoherence, a more complex, dense, fragmented, and pluripolar form of global financial governance is expanding possibilities for policy and institutional experimentation, policy space for economic and human development, financial stability and resilience, and financial inclusion. All this in a very enjoyable book that students, scholars, policymakers and managers of financial institutions should read right now. Andrea Bernardi is Senior Lecturer in Employment and Organization Studies at Oxford Brookes University in the UK. He holds a doctorate in Organization Theory from the University of Milan, Bicocca. He has held teaching and research positions in Italy, China and the UK. Among his research interests are the use of history in management studies, the co-operative sector, and Chinese co-operatives. His latest project is looking at health care in rural China. He is the co-convener of the EAEPE’s permanent track on Critical Management Studies. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

As Reader in Industrial Management in the Adam Smith Business School at the University of Glasgow, Rob Dekkers is well positioned to survey the currents of the vibrant systems tradition in the United Kingdom.  In his book, Applied Systems Theory, out in its second edition from Springer in 2017, Dekkers seeks to augment the valuable work done by Soft Systems Methodology in facilitating the engagement of multiple stakeholders, as well as the achievements of a host of other established cybernetic and systems approaches, with a set of modeling tools more formally rigorous than those previously on offer.  By drawing our attention to such factors as the need to keep secondary processes and resources within the boundaries of system models, the importance of a balanced blend of feedback and feed-forward control mechanisms, and the potential for miscommunication between differently focused “aspect systems” contained within the same organization, Dekkers offers the next generation of systems practitioners new techniques for developing the kind of foresight necessary to manage complex human activity systems in an era where the margins for unintended consequences continue to shrink at a seemingly exponential rate.  Dekkers combines a deep understanding of, and respect for, the work of previous generations of systemic thinkers with a keen sense of the gaps in systems practice still yet to be adequately filled; making this an ideal textbook for upper level undergraduate and graduate systems courses. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

Stephen C. Yeazell‘s Lawsuits in a Market Economy: The Evolution of Civil Litigation (University of Chicago Press, 2018) is an in-depth look at the development and current situation of civil litigation. It beings with the question of why civil lawsuits have become such a political question and uses that to explore our world of settlements, arbitration, trials and insurance adjusting. It gives an expert, informed and even-handed look at what can be a contentious topic and is accessible to the layperson and edifying even to the professional. It portrays our environment of civil litigation as an evolving one where real people solve real problems, often for society’s benefit. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

Is India facing a waste crisis? As its population, cities and consumption grow what are the implications for the health, well being and everyday lives of Indians? In Waste of a Nation: Growth and Garbage in India (Harvard University Press, 2018), Assa Doron and Robin Jeffrey discuss the genealogy of garbage and how it grew in quantity and changed in consistency in liberalising India. The book also provides us with an exhaustive birds eye view of the technological, socio-political and administrative challenges faced by those who work for a cleaner India. Ian Cook is a Research Fellow at the Centre for Media, Data and Society at the Central European University, Budapest and also the host of Online Gods: A Podcast about Digital Cultures. Juli Perczel is a PhD candidate in anthropology at the University of Manchester. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

In The Darkening Nation: Race, Neoliberalism, and Crisis in Argentina (University of Wales Press, 2018), Ignacio Aguiló studies the sociocultural impact caused by the failure of the IMF economic measures in Argentina of 2001-2002. Through the lens of cultural production (films, novels, short stories, artwork and music), the author explores two of the country’s so-called exceptionalisms: whiteness and economic success. These myths, heavily endorsed by the military dictatorship during the 1970s and early 1980s, created a sense of homogeneity and uniqueness that came into question at the time of the crisis. All of the cultural products studied by the author show different aspects of what was actually a crisis in the exceptionality myths that linked race with progress. Pamela Fuentes is Assistant Professor in the Women’s and Gender Studies Department, Pace University, NYC campus. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

I was joined in Oxford by Ben Clift, Professor of Political Economy, Deputy Head of Department and Director of Research at the Department of Politics and International Studies of the University of Warwick. Ben has just published a very important, timely and interesting book on the IMF: The IMF and the Politics of Austerity in the Wake of the Global Financial Crisis by Ben Clift (Oxford University Press, 2018). The book provides the first comprehensive analysis of major shifts in IMF fiscal policy thinking as a consequence of the great financial crisis and the Eurozone debt crisis. It widely presents the IMF’s role in the politics of austerity. The book also offers an innovative theory specifying four mechanisms of IMF ideational change – reconciliation, operationalization, corroboration, and authoritative recognition. It combines in-depth content analysis of the Fund’s vast intellectual production with extensive interviews with IMF economists and management. The book is structured in seven chapters plus conclusions: 1: The IMF and the Politics of Austerity in the Wake of the Global Financial Crisis 2: Ideational Change at the IMF after the Crash 3: IMF, Economic Schools of Thought, and Their Normative Underpinnings 4: Analysing the IMF Surveillance of Advanced Economies: The Social Construction of Fiscal Space 5: The Fund’s Fiscal Policy Views and the Politics of Austerity 6: The IMF, the UK Policy Debate, and Debt & Deficit Discourse 7: The IMF and the French Fiscal Rectitude amidst the Eurozone Crisis Conclusion – IMF Intellectual Authority and the Politics of Economic Ideas After the Crash IMF has been strongly criticised by economists, politicians, intellectuals and activists of the protest movements. This book might surprise many of them because it presents a much more pluralist if not heterodox set of economic ideas present and followed by the IMF’s economists and managers. The readers would discover that during the Greek crisis the IMF suggested a more flexible approach. In the case of Britain the IMF criticised the austerity policy of the Coalition Government. And in general the IMF has recently signalled that fiscal rectitude is not enough without support to aggregate demand and that inequality has to be monitored as well. Professor Clift argues that the Fund’s crisis-defining economic ideas, and crisis legacy defining ideas, were important in constructing particular interpretations of the crisis. ‘Fund leadership articulated a Keynesian market failure understanding of the crisis, focussing on deficiencies of aggregate demand, and on the destabilising properties of financial markets. The Fund’s re-emphasising of Keynesian insights into liquidity traps, demand deficiency, higher fiscal multipliers, and the folly of all countries consolidating at once sat outside orthodox economic policy-making ideas at the time. These were not the lessons policy-makers had typically drawn from academic economics before the crisis.’ This book is for those interested in the politics of economic ideas and in the interaction between economics and politics. IMF is presented as an arena where new economic ideas and the dominance of different schools of economic thought emerge. Despite internal politics, institutional rules and member states’ influence, the IMF has shown autonomy and intellectual authority. Our conversation ended talking about the future of the institution particularly looking at the European Union financial integration. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics

For decades the implementation of a single European currency was seen by its advocates as a vital step in the post-World War II movement toward greater European integration. As Ashoka Mody details in Eurotragedy: A Drama in Nine Acts (Oxford University Press, 2018), however, the euro that emerged was built on a dangerously flawed set of assumptions, ones which have made the euro a key factor in the continent’s ongoing economic problems. First proposed by French leaders in the 1960s, the idea of a single European currency was viewed by them as a way of shoring up their presence in the global economy. Though German politicians and bankers were initially resistant to implementing such a currency, this changed during the chancellorship of Helmut Kohl. As he grappled with the resistance to German reunification at the end of the Cold War, Kohl embraced the single currency as a symbol of Germany’s commitment to European cooperation and over the course of the 1990s he shepherded its creation over the objections of economists and growing popular discontent with the idea. These concerns proved prescient in the years following the euro’s introduction in 1999, as the single currency deprived participating nations of the ability to employ devaluation as a national response to global competition, creating added economic issues that have sharpened political tensions throughout the continent ever since. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/economics