Review: Naked Economics, by Charles Wheelan

The stated goal of Naked Economics is to break through the drear of the undergraduate study, cast off the bowties of the professorial set, and present the field of economics as the exciting and intuitive subject it actually is. I am happy to report this effort a success. Wheelan's book is well-written and makes its points in plain, clear English that people outside of the field (including myself, and also my wife) can easily follow. He's got a cogent global picture of economic theory and a sensible framework for its applications, and even while name-dropping half a dozen Nobel Laureates, he managed to tell me everything I thought I already knew, and who doesn't appreciate that?

Wheelan uses the skills of a good lecturer, laying out a hierarchy for understanding, that is, helping the interested student to stress what, in the mass of dull explanation, is the underlying idea and which are the more illuminating and useful details, which is an especially handy tool when your input is not so much a dry textbook, but endless piles of magazine articles and blog posts of varying levels of crackpottery. As someone who's forced to bullshit his way into new fields with some regularity, I appreciate this sort of quality overview approach those rare times I actually find one. I have a long-standing complaint about the dearth of good intermediate-level texts in any subject at all, but Wheelan's fine for taking a basic view, and in economics, it's hard to be very quantitative anyway. Wheelan also performs a novelist's trick I love: he leaves hanging some obvious questions and objections in early parts of his text, but shows enough awareness of them, and enough promise of resolution, that I, the reader, plow into the next section to find out what he'll reveal.

Wheelan writes for The Economist, and appropriately to his audience, his economic spectrum spans a conservative American model all the way over to a conservative European one. He does take a digression to the developing world under that framework (which includes a curiously circumscribed discussion of root causes of the horrible economies, but we can say for now, and Wheelan would probably assert, that the systemic flaws he cites are meant to be considered independently of their origins to the extent possible), and he does talk about Communism, although it exists more as a counterpoint to his generalist aproach than as part of it. And allowing for these huge caveats, I don't think it's bad to be inclusive, and I do agree with him that the flow of capital does follow some predictable rules. I appreciated the dynamic he presented between government and the private sector. He acknowledges that the government creates a market in the first place, and provides services (of various levels of merit) in exchange for hobbling parts of the economy, which is an admirably neutral position. Wheelan is certainly sane enough to realize that there is any range of things that can be bought or commanded by the gang in charge, and many of them will have positive or negative economic or social consequences, but smart policy-minded people can argue calmly over what is involved in the better administration. My long list of objectionable points is mostly a disagreement on the specifics of what we should pay for, discomfort at Wheelan's embrace of uncertain authority, and disagreement on what is a smart incentive. Keep in mind that my sense of rightness is aided by the wisdom of the past six years, and this guy wrote his book in 2002.

Naked Economics, in short, gives you all the tools you need to read and enjoy op-eds. Wheelan does an excellent job of explaining the accepted economic viewpoints, and they're as reasonable, universal, and honest as those of the best policy-maker or paid commenter.