By Niall Kishtainy
A journey through economic thought
Subject
Themes
Economic thought emerged from humanity's fundamental struggle with scarcity. Whilst readers today possess money to buy books and literacy to read them, millions in places like Burkina Faso lack both privileges. Economics studies how societies allocate scarce resources, asking why some economies succeed whilst others fail. Ancient philosophers grappled with these questions: Plato imagined ideal city-states with philosopher-kings, Aristotle defended private property, and medieval thinkers condemned usury whilst Italian merchants merged God's economy with commerce.
Economic thought emerged from humanity's fundamental struggle with scarcity. Whilst readers today possess money to buy books and literacy to read them, millions in places like Burkina Faso lack both privileges. Economics studies how societies allocate scarce resources, asking why some economies…
Niall Kishtainy's *A Little History of Economics* arrived at a crucial moment for the discipline. Published in 2017, the book entered ongoing debates about economics' failures and future following the 2008 financial crisis. Critics across the political spectrum questioned whether mainstream…
Adam Smith's metaphor of the 'invisible hand' captures a central paradox: how can millions of people pursuing their own interests create a functioning society? Unlike football teams requiring managers to organise players, economies coordinate without visible central direction. The butcher, brewer,…
Markets operate through a complex web of interactions between buyers and sellers, where prices emerge from countless individual decisions rather than central planning. This decentralised coordination mechanism, often described as an invisible hand, guides resources towards their most valued uses…
Governments face a fundamental tension between allowing markets to operate freely and intervening to correct failures or pursue social goals. This debate has shifted dramatically across different eras, reflecting changing beliefs about whether economic instability stems primarily from market forces…
Economic theory traditionally assumes that people make rational decisions by carefully weighing costs against benefits, maximizing their satisfaction given available resources and information. This conception of homo economicus, or rational economic man, provides powerful analytical tools for…
Economic success cannot be measured solely through aggregate statistics like gross domestic product or average incomes. Distribution matters profoundly, both within societies and across nations. The question of who benefits from economic activity, and whether prosperity reaches those most in need,…
Stark inequality defines the modern world. A person holding this book possesses two privileges millions lack: the money to purchase it and the literacy to read it. In Burkina Faso, fewer than half of young people can read, whilst girls haul water instead of attending school. Economics studies how…
At Versailles in 1760, François Quesnay despaired after his friend Marquis de Mirabeau was imprisoned for publishing views on taxation. The hothead Mirabeau had advocated Quesnay's radical proposal to tax aristocrats instead of peasant farmers, enraging King Louis XV. Quesnay led the physiocrats,…
Thomas Malthus, David Ricardo's clergyman friend, became economics' first professor in 1805. His 1798 *Essay on Population* attacked believers in human progress. Malthus began with simple premises: humans need food and sex to reproduce. Population doubles each generation if unchecked; 1,000 people…
When World War I erupted in 1914, Lenin hid in Poland's Tatra mountains, exiled across Europe using false names and fake passports. In Russia, comrades showered his paper *The Spark* from theatre galleries onto wealthy audiences. Lenin believed war meant ruling classes sending working men to kill…
Thorstein Veblen, raised on a Wisconsin farm, became America's closest equivalent to Marx: an outsider observing society critically. As a boy, he shot his neighbour's dog during an argument, scrawling insults on the fence in Greek. America industrialised rapidly after 1865's Civil War, railways…
During World War II, two economists sat on King's College Chapel's roof protecting it from German bombs with shovels. John Maynard Keynes, brilliant and self-assured, and Austrian Friedrich Hayek, quiet with formal precise speech, were economic opposites. Hayek shocked people claiming Britain and…
Kenneth Arrow and Gérard Debreu tackled a puzzle that Alfred Marshall's nineteenth-century market theory couldn't solve: how millions of markets coordinate without anyone setting a timetable. Marshall analyzed single markets in isolation, showing how supply and demand reach equilibrium. But markets…
Britain's winter of 1978-79 buried the dead in unploughed snow when gravediggers struck, left supermarket shelves empty when lorry drivers refused to work, and marked Keynesian economics' death. 'Stagflation' combined high unemployment with high inflation, contradicting Keynesian predictions. Milton…
George Akerlof's 1970 article 'The Market for Lemons' analyzed second-hand car purchases. Sellers know whether cars are duds but always claim excellent condition. Buyers facing 50 per cent odds of buying lemons offer intermediate prices between high and low. Good car owners withdraw from markets…
In 2006, 70,000 Americans waited for kidneys whilst fewer than 11,000 transplants occurred and 5,000 died or became too sick. Organ sales remain illegal despite desperate need. Alvin Roth designed kidney exchange without money: your kidney might mismatch your brother but match another patient whose…
By Niall Kishtainy
Subject
Themes
Economic thought emerged from humanity's fundamental struggle with scarcity. Whilst readers today possess money to buy books and literacy to read them, millions in places like Burkina Faso lack both privileges. Economics studies how societies allocate scarce resources, asking why some economies succeed whilst others fail. Ancient philosophers grappled with these questions: Plato imagined ideal city-states with philosopher-kings, Aristotle defended private property, and medieval thinkers condemned usury whilst Italian merchants merged God's economy with commerce.