“What’s the difference between a recession and a depression,” asks a member of the public. “A recession is when you lose your job; a depression is when I lose mine,” replies an economist.
This is just one of numerous little jokettes that colour the pages of The Cartoon Introduction to Economics—a brilliant must-have for any student or teacher of economics or, indeed, anyone else interested in getting to know or simply recapping on the basics of a field that is currently positioned at the center of local, national and global decision-making.
The book—written by the world’s first and only stand-up comedian economist and University of Washington Professor of Economics Yoram Bauman and illustrated by the famous cartoonist Grady Klein—is split into two convenient volumes: Micro- and Macroeconomics, released in 2010 and 2012 respectively. That is not to say that they are entirely separate. In fact, the genius of the two-volume book lies in the fact that from the first page of Micro to the last page of Macro the story of different economic theories and surrounding debates are expertly weaved into one continuing, engaging narrative that starts small and ends big.
Micro starts from the central assumption of all economics that each individual is a rational optimizer and glides through the latest theories on how such a person would make decisions under different conditions and what biases he is likely to make. The first section covers such topics as decision trees, the time value of money and it’s use in decision-making, decision-making under risk (diversification, expected value, adverse selection, and so on), and trade (efficient market hypothesis, Coase Theorem, and the like). It then traces what outcomes and decisions are seen when a few optimising individuals interact, taking its readers through cake cutting, Pareto efficiency, simultaneous-move games, auctions, and larger markets that entail competition and monopolies. The final section increases its reach and introduces its students to what happens when many more individuals are involved, looking at the theories and properties of market-level interactions, the rules of supply and demand, taxation, margins and elasticity, and the effects of competitive markets and market externalities.
If all that already sounds daunting to someone unfamiliar with or just starting out in economics, don’t worry. The cartoons and the myriad of everyday metaphors used to explain the concepts and theories are incredibly accessible and useful as they do what many ordinary economics text books fail to: help its readers visualise and internalize what all this economic jargon means in the real world.
The Macro volume is equally engaging and follows a similar evolutionary path starting with leading economic theories that affect: a) a single country’s economy, including how governments deal with unemployment, why they manipulate the money supply, what are the causes of and solutions to inflation, Gross Domestic Product (GDP) as a measure of economic progress, and arguments around what the role of the government in the economy should be to; b) what is theorised to happen when two or more countries begin to interact by sharing technology and goods through international trade, aid and foreign currency exchange; and c) finishes by looking at global macroeconomics and the planet-wide processes that occur, raising important questions about whether or not the boom and bust monster of business cycles can ever be tamed, whether poverty could ever be ended or if the planet will end first, and what can the world do about an ever-growing ageing population. Throughout, several characters—like the superhero-types Monetary Policy Man and Fiscal Policy Woman—appear and re-appear to ease the reader into a better understanding of the issues.
The strength of the book is in its balanced presentation of different sides of the argument and the metaphors that are invoked to facilitate that process. For example, throughout it presents the views of those who see the economy as a well-functioning family, to those who see it as a dysfunctional one and the differences in policy recommendations for type and amount of government involvement that follows. And it does not shy away from including critiques of economic theories coming from those who rightly point out that a lot of the time what happens in the real world does not support the theory, or the fact that there are bigger global issues like climate change to deal with that are only worsened by an emphasis on economic growth. It finishes with a much-needed reminder that macroeconomics is ‘full of monsters’ and economic theories are just that—theories.
The two-part book is not aimed at an expert audience. Nevertheless, even the most seasoned economists would find it amusing and a real page-turner, while teachers of economics could find inspiration for better, more engaging instruction. Any inquisitive non-specialist would gain a lot more from it and the book’s biggest contribution could come from successfully educating interested members of the general public about the fundamentals of economics—an important challenge for the years to come.
To give Development Roast readers a sneak peek during the INESAD Fun Economics month, Professor Yoram Bauman and the book’s publisher FSG Books have agreed to share cartoons from Volume Two: Macroeconomics for our Monday graphics series. Don’t forget to check back each Monday in October for a chance to see Cartoon Economics in action.
Do you know of any other economics, sustainability or international development books that try to make learning fun and engaging? Leave a reply below.
Ioulia Fenton is the food and agriculture lead at the Center for Economic and Environmental Modeling and Analysis (CEEMA) at INESAD.
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