The Great Economists: How their Ideas can Help Us Today, by Linda Yueh , published by Viking / Penguin Books 2018.

Linda Yueh provides an excellent introduction to the great thinkers that have shaped the field of economics over the past two centuries. For each of the eleven men and one woman, tells the story of their life, synthesizes their main ideas, and speculates how they might analyze and advice on contemporary economic challenges.

The book is a good introduction to the history of economic thought, and as such is recommended reading for any student of related fields – those with ambitions in economics itself probably need a deeper and more technical understanding of these ideas. Linda Yueh is talking to the intellectually interested general public as well as business leaders – I presume this book is mandatory reading for the courses she gives for MBAs at London Business School. However, even for someone who is familiar with the basic ideas of the twelve scholars, Linda Yueh’s reflections on their contemporary relevance contain a lot of food for thought.

A Bigger Prize: Why no-one wins unless everyone wins, By Margaret Heffernan, published by Simon & Schuster 2014 (paperback 2015).

A successful entrepreneur challenges the idea of competition - isn't competition is essence of entrepreneurship? The title intrigued me when I saw the book in an airport bookshop in Finland, even though I know Margaret Heffernan as a provocative, non-conventional thinker. She has been an entrepreneur-in-residence at the University of Bath for many years where we briefly worked together a few years ago.

Heffernan launches a thoughtfully argued and richly illustrated attack on the idea that competition is the best way to bring forward society. Especially when competition in reality becomes a winner-takes-all competition where only coming first counts, it has two highly detrimental consequences. First, those who are nowhere near number 1 are de-motivated from putting effort to start with, e.g. kid who don't expect to top the rankings won't bother learning - and hence be worse off in the long run. Second, those top 5% competing for the ultimate prize will exhibit anti-social behaviours and fail to collaborate - in fact, the bigger the winners' takings, the bigger the incentive to cheat. Consequently, projects that require inputs from many bright minds - such as scientific endeavours - don't progress because efforts are not pooled.

Heffernan discovers these types of problems in a wide range of situations, including sibling rivalry in the family, school education, sport careers, and business organizations. She has interviewed numerous people in all walks of life in the US and the UK (she lives in these two countries), and read extensively in scholarly works and news reports. Thus her argument is at the same time richly illustrated and backed up by science - and hence easily accessible despite the book being 376 pages long (plus endnotes and bibliography).

What is more challenging is to identify realistic alternative ways of organizing notably education and businesses. Heffernan clearly likes the Finnish education system: teenagers are not assessed and ranked all the time, but rather assessed qualitatively and by the standards the school finds suitable. Teachers are highly educated, well remunerated, and given a high degree of autonomy. Yet in the PISA studies of educational achievement, Finland came out on top. In Finland, every student counts - and if a random sample rather than the best performers is tested, then Finland does well indeed. For economic prosperity, a society needs contributions from everyone and not just the elites, and so Finland has been doing well.

Heffernan also highlights experiences of innovation and design businesses such as W.L. Gore, Techshop, Morning Star and Eileen Fisher that are organized with flat or now hierarchies, string elements of employee ownership, and project based rather than hierarchical organizational structures. While these example firms appear to thrive, they are small in numbers and it is less obviously that larger businesses in more mature industries could succeed in the long run (the Mondragon group in Spain tried, but for all I know is now fighting for survival). Heffernan's key message is that organizations should reduce the intensity of competition in favour of more collaborative management approaches. Yet, how this idea can be translated into action in specific businesses remains vague.

Good Strategy - Bad Strategy: The Difference and Why it Matters, By Richard Rumelt, published by Profile Books, 2011 (paperback 2013).

Teaching strategy for a living, I found this book very stimulating. It does not change the substance of what we teach from established textbooks (in addition to our own International Business, we use Grant's Contemporary Strategy Analysis). But Rumelt pushes further beyond from analytical tools and cases to what is usually so hard to achieve in a classroom setting, namely to get students to think for themselves, rather than wait for the professor to tell them some fairytale as to why this or that company has a brilliant strategy. The challenge is that good strategy has to be unique - if you come up with something that others are already doing, then you won't have any unique competitive advantage because that other competitor is already there. In other words, good strategy is driven by the strategists unique (or rare) insight into a situation, and hence an idea how to make more from it than any of the competitors.

Thinking strategically requires diligence in studying the situation, creativity in generating idea, and rigour in assessing your idea - and constantly re-assessing your own in view of new information. Rumelt advocates a process of strategizing of three stages: 1) diagnosis of the situation, which in classroom, we would call the analysis of the firm, the industry, and the wider environment - and the interpretation of all this fits together, 2) guiding policy, which are the big ideas underlying both the goals of the organization, and the big ideas how to get there, and 3) coherent actions that would not necessarily offer a complete plan, but be key actions moving the organization forward along the intended path, which in MBA or consultancy assignments would be the recommendations part.b

Rumelt, who is one of the most esteemed professors in the strategy field, talks a lot about his experiences of teaching strategy to quite senior audience audiences. There is a lot of best practice example to follow. I also took encouragement from the fact that even with his senior audiences, he faces uphill struggles to explain that strategizing is not like solving an engineering problem. For MBA teachers this is our daily bread. Developing strategy is problem solving with a huge number of unknowns, last not least the reactions of all the competitors are unknown - but all these unknowns are key to whether or not your strategy works. Such uncertainty is unsettling for everyone used to engineering approach to problem solving. But it can't be avoided. Rumelt comes up with an analogy: a strategy in business is like a hypothesis in science - it is your best informed statement of what you think will work, but you will only find out if it works after trying it out, which may take many years.

The book is rich in insights of many kinds, and a very good complementary reading to any strategy textbook. Every chapter has some anecdote; but some of the most valuable advice is actually simple. Like, the one Frederick Taylor gave to Andrew Carnegie back in 1890: make a list of the 10 most important things to do, and then start doing #1. You think that is trivial? OK, when was the last time you made such a list?

Thinking, Fast and Slow, by Daniel Kahneman, published by Allen Lane 2011 (paperback by Penguin, 2012)

A lifetimes worth of insight on how people really behave. Daniel Kahneman is one of the best known psychologists of the 20th century, and he even got a Nobel prize in Economics. Everyone probably suspects that the assumptions that economists usually work with, specifically 'full information' and rational decisions' don't quite hold. But Kahneman has studies human behaviours for half a century, especially using a wide variety of experiments, and he found that our actual decisions - even the decisions by experts - are affected by a huge variety of biases, and these biases are huge: from our inability to assess probability, to tendencies to trust easily available information, the importance of framing a question, and the influence of unconscious and irrelevant information.

The book is popular science at its best. It reports the findings of his studies with most of the key information one would need, yet written in a way that most people can easily appreciate. It should be core reading for students of business and other social sciences. It will help readers to understand their own decision making limitations, and perhaps help them to do more systematic (slow) analysis before making fast decisions. It will certainly help looking through some of the gimmicks that advertisers and politicians use to make us buy their message, and that superficially do not make sense to the rational mind. But humans are not rational unless they make a big effort to act rational.  Very powerful ideas!

Nudge: Improving decisions about health, wealth, and happiness, by Richard H. Thaler and Cass R. Sunstein, published by 2008 (paperback by Penguin, 2009).

Contemporary research on psychology and behavioural economics, such as that synthesized by Kahnemann, has influenced contemporary policy debate. The translation of ideas from contemporary research to the policy area has been led by Thaler and Sunstein with the book 'nudge'. They develop a political philosophy of 'paternalistic libertarianism', which allows citizens to freely choose what they want, but governments (or private organizations) designs choices in such a way that limited rationality does not lead people to make bad decisions. For example, government should design the 'choice architecture' in ways that the default option, say participating in a pension plan, is believed to be in the interest of (most) people concerned, while giving them the option to 'opt out' rather than requiring them to 'opt in'. Other ideas rely on providing information in an accessible form, reducing barriers to people making conscious decisions and providing statements on full actual costs for energy, phone or mortgage contracts on an annual basis (and option to switch based on such information). Of course, such 'nudges' are extensively used by private companies trying to sell their produce but their potential for public policy seems underutilized.

Thaler and Sunstein apply their ideas primarily to contemporary policy disputes in the USA, such as pensions, health care and mortgage systems (with a few European ideas added in). Readers from other parts of the world will still find the ideas intriguing, but they need to translate them to their own contexts, One idea, namely that there should be a simple normally beneficial default option for those not making a choice, whoever isn't that new - it has been driving Napoleon 200 years ago when designing the Code Civil, which became the foundation of legal systems around the world (but not the USA). Thaler and Sunstein in their chapters on healthcare and marriage push libertarian ideas that reply mostly on increasing choice but reduce social cohesion and thus have less to do with the core idea of 'nudge'. That not withstanding, their basic ideas offer often simple yet influential approaches to many policy and veryday life issues. 

A History of the World in 100 Objects, by Neil McGregor, published by Allen Lane 2010 (paperback by Penguin, 2012).

Imagine you take a walk through a museum, and rather than trying to see everything you wander around and stop by some particular intriguing objects, and chat with your friends each sharing their knowledge about the time and place this object comes from, and how it relates to the modern world. At the end of your visit you will have learned a lot - not structured like a textbook - but scattered like the infamous five blind men that I like to cite. That is what it is like to read this book, except that all that dispersed knowledge is brought together by one expert, Neil McGregor, the curator of the British Museum - the Museum that probably provides the most diverse perspectives on human history. Reading the book is a little like reading a book of 100 short story - yet at the end you will probably understand a bit better what we as human beings have been gone through since the dawn of time.

So, are there any lessons to be drawn from these 100 stories? It probably depends how good your history courses back in high school were. But it is probably fair to assume that everyone learned a fair bit of their country's history, a little bit about others, probably a lot about Europe, and a bit about China. This book certainly rebalances that. What is more, human history has been transmitted down the generations effectively by those cultures that kept written records (preferably on non-perishable materials), and those who left behind major physical structure of stone. Yet, there were other cultures that very little was known about until recent archeological finds, especially cultures in North and South America, Africa and South Asia. So, the most fascinating insight that I gained from reading these 100 short stories is how rich and diverse human experience has been, even several thousands of years ago.

The Myth of the Rational Market: The History of risk, reward, and delusion on Wall Street, by Justin Fox, published by Harper, New York, 2009.

Justin Fox provides a uniquely insightful history of scholarly work on financial markets. He approaches the topic like a journalist - by interviewing the key 'thought leaders' and players on Wall Street, along with reading some of their work, rather than (as an academic would) by using the published texts as main source complemented by citation analysis and other techniques to document their influence. The result is a very readable account of the key people in both universities and the financial sector itself, and a clear explanation of the key ideas as to how financial markets work (or don't work) - or how much scholars and practitioners actually understand of how they work.

From this he arrives at a quite balanced assessment of what the hypothesis can and cannot do. In normal days of market activity, it provides a good understanding of how market function - and critically explains why past price movements do not allow to forecast future price movements. However, behavioral economics has discovered several abnormalities - most of which disappear once they have been described because arbitrageurs in the market take advantage of them.  Yet, there many more subtle arguments around these central theme, and hence this book should be a must-read, whether you are a PhD student in economics, a participant in the financial market (like an MBA or MIF student), or simply an investor with a few buck that you don't want to loose due to poor advice by your banker. 

Voyage aux pays du coton. Petit précis de mondialisation,  [Journey to the Lands of Cotton. A Brief Manual of Globalisation] by Erik Orsenna, published by Fayard, Paris, 2006.

This is a fascinating book about globalization seen from the perspective of cotton. The author, a French journalists has traveled across the world in search of the cotton farmers and the cotton industry, aiming to explore how globalization has shaped the industry. He thus met cotton farmers in Mali, cotton lobbyists in Texas, genetic engineering experimenters in Brazil, traders in Egypt, Sock manufacturers in China and the last of the textile manufacturers in the Vogese region of France. He met interesting characters and has fascinating stories to tell - travel truly broadens the mind.

The facets from around the world offer no easy answer, except that any simple response to globalization is bound to be too simple (and likely to do more harm than good). The book makes for every entertaining read, though the facets are often too brief to really understand what is really going on, and how all those people who life is intrinsically linked to cotton interact with each other around the world.

For a TV interview with the author click here. (In French, I couldn't find an English translation of this book)

The Brain that Changes Itself: Stories of personal Triumph from the Frontiers of Brain Science, Norman Doidge, published by Penguin books, 2007.

A fascinating book, popular science at its best. The author introduces latest advances in neurosciences (science of the brain) by focusing by focusing on people who benefited from new forms of therapy to manage their conditions, or who engaged in learning processes fitted to their needs to overcome personal obstacles, or to stay alert and engaged in old age.

The main message from this book is that the brain, like any human organ, has the ability to develop when exposed to persistent and rigorous training. Experts for a long time believed that the brain is 'hard wired' in adults, and thus cannot be changed. Yet, recent research - including animal experiments that some may find objectionable on ethical grounds - has demonstrated that the brain can re-wire itself after an accident or a birth defect. This insights has been the trigger for major advances in the therapies that are offered to people who, for example, suffered a stroke and suddenly experienced damage to the brain. In the extreme, it is possible that a different part of the brain takes over from a defunct part. This is a fascinating book because it offers so many new opportunities. But it also means that your brain needs to be trained continuously - like athletes train their muscles - to maintain it in good working condition, and to learn self-disciplined exercises are the best way to develop news skills. 

This summary sounds a bit academic - but the book is actually written in a most accessible style, organized around patients experiences and explaining what new research helped them improve, and largely avoiding any expert jargon. Highly recommended.

A Reason for Everything: Natural Selection and the English Imagination, by Marek Kohn, published by Faber and Faber 2005.

Everyone knows Charles Darwin's work on Evolution, yet scholarly thinking about evolution has evolved (sic!) considerably over the past century and half. Marek Kohn tells the story of scholarship into evolution in a very personal, even intimate perspective: He tells the life stories of eight scholars all based in England, who shaped how we think about evolution today. In early days, evolution - embedded in botany and zoology was mainly about collecting specimen in local forests and in exotic locations like the Amazon forests of Brazil or the Islands of Malaysia.

Other scholars pursued experiments in Mendel's tradition, while the most recent scholars - most notably John Maynard Smith - used formal mathematical models. In fact these mathematical models, partially inspired by game theory, has contributed back to game theory as it is used in economics. Finally, the probably best known contemporary scholar of evolution, Richard Dawkins, engaged with the broader public by developing ideas in popular book, and pointing to genes (rather than organisms, or populations) as the core unit of evolution. This book is a biography of eight remarkable man. While reading about their lives, and their eccentricities (they are all British), the reader learns about the evolution of this fascinating area of scholarship.

In der Fremde: Ingenieure und Techniker auf interkultureller Entdeckungsreise in arabisch-islamische Ländern, in China und in Indien [In foreign Lands: Engineers and Technicians in Islamic countries, India and China], edited by Mona Spisak / Hansruedi Stalder, published by Haupt, Bern, 2007.

How do you prepare future expats for their stint abroad? There are so many things one ought to know, and so many anxieties before you go for the first time. Some people get totally exhausted by the expat experience, while other just can't get enough of it. Scholars have developed all kinds of concepts and scales supposed to help people prepare to work in other countries - but,  frankly, in practice they are of little use. Alstom, a Swiss engineering company, is dealing with this challenges very regularly: Their engineers are installing power plants all over the world, and they have to send people who grew up in stable peaceful Switzerland to remote corners of the world. To help them, they came up with an innovative approach: They paired expats with authors (young scholars or journalists), who made an interview and wrote up their personal story.

The result is a fascinating book of personal experiences of people working on the ground, mainly in major construction projects, and interacting with a huge diversity of local people. These expats stories and anecdotes provide a valuable complement to any more formal training in cross-cultural management; and an entertaining read for people who love travel stories. (in German, I couldn't find an English translation of the book).

Watching the English: The Hidden Rules of English Behaviour, by Kate Fox, published by Hooder & Stoughton in 2004.

This is an anthropologist's summary of her lifetime of investigating her own people. It is very entertaining indeed, at least if you know a little about English culture, and have lived here for a while. You also have to understand British humor with its mix of self-depreciation and subtle understatement; the author does not want her observations to be taken too seriously. The book goes in depth and some passages are quite academic as the author is searching for what it means to be "English". Thus, it is probably not suitable as airplane reading for first time visitors - unless you are a fellow anthropologist. However, the book is well known amongst may expat friends and colleagues - more so that among the native for whom the book was originally intended.

The authors favorite topic is English pub culture - I am sure she enjoyed the field research. She describes the unwritten rules of behaviour, on buying rounds, communicating with barmen, giving tips or not, male bonding etc. According to her research, whoever offers to buy the first round usually does not end up paying more than others - so remember that when you next meet me in a pub :-). A theme throughout is, probably unavoidably, class. I started noting subtleties of behaviour of my colleagues that I had previously been blissfully unaware of. But with a regular dose of English humor, fair play and patient queuing, life if not too bad in England, even in a rainy summer.

Taipei People, by Pai Hsien-yung, published in English by Chinese University Press, Hong Kong in 2000. (Chinese original 1971)

Short stories of a generation of people in Taipei, who had come over from the mainland at the end of the civil war, and grown old in a rapidly changing city. The stories paint images of people who lived in difficult times, suffered their fate, and make ends meets as a new generation grows up without those mainland memories. The term 'Taipei People' has become a popular phrase in the language of the city, reflecting the curious fact that most of the people in this book were born in China mainland and brought to Taiwan through the upheavals of the civil war of the 1940s.

This collection is a master piece of Chinese story telling.

Taiwan's Imagined Geography: Chinese Colonial Travel Writing and Pictures, 1683-1895, by Emma Jinhua Teng, published by Harvard University Press in 2004.

For many communities, history is a pivotal element of defining who they are, and what they stand for. National leaders, especially authoritarian ones, thus have a tendency to try and control how their own nations history is to be interpreted; yet history is always subject to interpretation and no longer do winners alone determine how history is written. This may have been accepted across Europe by the end of the 20th century, but in many parts of Asia the interpretation of history can still create huge controversies. In few places is this more true than in Taiwan, which was first put in the map of China in the the early Qing period, in 1683, and was gradually colonized until it became a province in 1887, only to come under Japanese control in 1895.

Emma Teng provides an unconventional yet insightful perspective on the gradual evolution of Taiwan to become part of China: She reviews and interprets the writings of travelers to Taiwan throughout the Qing period, tracing the gradually changing representation of the land and in particular its local inhabitants. In the early years, Taiwan was see as strange and distant, in large part inaccessible due to hostile natives and mountainous territory outside the coastal areas under Chinese control. In late Qing, that control had expanded, and natives were clearly distinguished between civilized ones adapted to Chinese society and the wild ones who were driven back into the mountains. In the 1870s, when the Chinese pushed towards control of the entire Island, the non-integrated natives were perceived as backward and a threat to imperial power. Ex post, after 1895, Taiwan soon was presented as an integral part of China. Vivid descriptions of life of the locals in the original texts - don't miss the excerpts of Yu Yonghe's travel account of 1697 in the appendix - are interpreted in the context of scholarly discourses, which however include a fair bit a repetition and some rather abstract deliberations.

Istanbul, by Orhan Pamuk, published in America, 2003

"Nostalgic!" the waiter said when he saw the book on the table as we were sipping tea by the waters of the Bosporus. It didn't sound like a compliment. But Orhan Pamuk is certainly well known here in Istanbul if even the waiter knows his work. He got the Nobel price for among other this book. So, what can I say that hasn't been said before?

I picked the book up at an airport a few weeks before traveling to Istanbul to get some background on the city and its history. The book is discovering the city like a visitor would who - in the ways I often do - just sets out into any direction and wonders around the town, looking in some backyard here, and some fancy museum there, walking busy markets, and and lonely alleyways, without out a specific plan other than to experience the spirit of the place. The difference is that Orhan Pamuk is describing not a tourist visit, but the meandering of his own youth, his discoveries in the cities, as well as his reflections over many of those who have described the city before him - though Western or Eastern eyes, and through literature or through painting.

The recurring theme is melancholy, a sentimental sense of things not being what they ought to be, of Istanbul having seen better days. He talks of ruins of old building, and ordinary life, far removed from the palaces and stories of 1001 night. He mainly talks about the 1960s and 1970s when old people still remembered the declining Osman empire, and young people set there hopes abroad. However, many of the underlying themes of the society he describes are still present today - the Europeanized middle classes who live a secular life and are mentally oriented to Europe or America, while working classes and recent immigrants from the country side are more religious and have different dreams.  Also the struggle for the identity - is Istanbul a European city, or an Islamic-Turkish city? These social tensions are as much part of the identity of this city, as are the picturesque views over the Bosporos!