In the realm of understanding our world, Andrew Leigh’s “How Economics Explains the World: A Short History of Humanity,” published by Mariner Books in 2024, is a must-read. Lauded by Nobel Prize winner Claudia Goldin for its insightful narrative, the book is a compact 200-page exploration that deftly interweaves economic history with compelling storytelling, making it ideal for those intrigued yet bewildered by economics.
The book serves as a vibrant tapestry, unfolding pivotal moments that have forged today’s global economies. More than just a collection of facts, it unveils how economic forces have influenced historical trajectories, providing readers with a thorough understanding of the environment we inhabit today. From the beginning to the end, it aims to clarify the complexities of economics with engaging narratives.
Leigh’s preface poses significant questions that capture the essence of the narrative. Why was it that Africa didn’t colonize Europe? What were the ramifications of trade barriers during the 1930s? The book seeks to address these queries, exploring events like the Allies’ victory in WWII and the surge of inequality in Western nations post-war. It also probes how property rights spurred China’s growth and how climate change poses threats to prosperity.
Divided into 14 chapters, the narrative begins with the emergence of modern humans around 3,000 years ago in southern Africa. It expounds on the agricultural revolution and highlights why certain regions were more conducive to farming, with Eurasia boasting livestock for sustenance compared to more difficult tamed animals like zebras in Africa.
Geography also plays a pivotal role; the broad expanse of Eurasia facilitated exploration within similar climates, while Africa and America’s elongated forms complicated settlement patterns. This geographical advantage explains Eurasia’s eventual colonisation of other continents. Leigh also recounts the contributions of influential economists like Alfred Marshall, who popularised market equilibrium and emphasized diagrammatic explanations that continue to shape economic education today.
John Maynard Keynes offers a fascinating perspective, asserting that economic phenomena such as the Great Depression arise from unpredictable human behaviours. His Keynesian Theory, advocating government spending to rejuvenate economies, remains highly pertinent today. Paul Samuelson, another intellectual featured, argued for governmental intervention during economic crises, promoting the idea of comparative advantage in international trade.
In a poignant chapter, Leigh asserts that throughout history, technological advancements have driven economic revolutions. He reflects, “Having a trading partner is not a threat, it is an opportunity. Trade is at the heart of the modern economy and the opportunity it has generated.” This wisdom resonates especially in the current era of protectionism.
Leigh characterises economics as a social science focused on optimising human well-being amidst scarcity, while also examining public policy solutions to modern challenges like poverty and climate change. He highlights that major fluctuations in societal well-being typically stem from shifts in technology or policy, underlining the importance of governance in shaping quality of life.
Andrew Leigh’s “How Economics Explains the World” is an accessible yet profound exploration of economic history, recommended by Nobel laureate Claudia Goldin. The book addresses vital questions about historical economic events, spans 14 chapters from human evolution to technological impacts and underscores how economic principles shape society and government policies. It presents economics as key to understanding contemporary challenges like climate change and public welfare.
In conclusion, Andrew Leigh’s book not only encapsulates the essence of economic history but also demystifies the intricate relationship between economics and societal progress. By addressing pivotal questions and historical events, it offers a broad understanding of how economic forces have moulded our reality. As we face challenges like climate change and shifting technologies, Leigh provides a necessary lens to navigate and adapt to our ever-changing world.
Original Source: www.philstar.com
