what would be a good book that would serve as a nice introduction to economics ? i currently am planning to go through "economics, by samuelson and nordhaus". is there something better ?
I highly recommend Basic Economics by Thomas Sowell. The title is not very imaginative but I found it a great place to start before looking at more complicated concepts.
I second this recommendation. I learned a lot about economics from this book...and felt my liberal latte-drinking hippy self shifting a good deal towards the right :).
Thirded. I would also recommend Economics for Dummies. Sure, it's a "For Dummies" book but it actually goes into quite a bit of detail and gives good visual / graph based explanations for things that Sowell covers more verbally.
I wish I could help you. I majored in economics and math, and can't recommend a single one of my economics texts. I kept a good number of my math books, but sold all my econ texts when I graduated.
That being said, you will probably get better results if you specify what you mean by "economics." There are several disciplines within economics: microeconomics, macroeconomics, econometrics, financial economics/mathematical finance, game theory, etc. The material in each of these disciplines will vary considerably depending on how theoretical the textbook is. For example, a graduate-level theoretical macro text might talk about general equilibrium models, but a more practical macro text would cover topics like the implementation of monetary policy, economic history, the relationship between the government and the economy, costs and benefits of international trade, etc.
If anyone knows of a good comprehensive overview of the field, I would be interested in hearing about it.
Philip Coggan's http://www.amazon.co.uk/Money-Machine-Penguin-Business-Libra... Money Machine is not directly an economics book, but details the movement of money through the global economy (but focused on London, specifically) and is an excellent overview of fiscal policy.
It depends if you're looking for a textbook or more entertaining general-audience book. If the former, check out Principles of Economics, as mathoda suggested. If the latter, here are Mankiw's recommendations:
http://gregmankiw.blogspot.com/2006/05/summer-reading-list.h...
It does not follow the basic principle that knowledge is proved and disproved by experiments. You can find all the sophisticated mathematical methods you want in economics, and none of them would stand a test of reality. Most of so called 'models' come with disclaimers against 'exogenous' shocks, and pretty soon you discover that our whole life is one big exogenous phenomenon.
No wonder economists today are desperately in search of identity. You can see them dabbing in psychology, history, social behaviour studies, business organisation etc. It's all call 'economics', but plucking concepts from assorted fields does not compensate for a general lack of substance.
'Economics' can include hard factual stuff like how international trade or balance sheet of a central bank work. Those are hard to argue with because that is mostly accounting. Like the fact that bloated 'left side' of the balance sheet should be covered by issued money on the 'right side'.
Mainstream economic concepts such as 'equilibrium' or the horribly misnamed 'Modern Portfolio Theory' are as far from latest scientific understanding of the world as mediaeval barbers are from the modern medicine.
So instead of polluting the brain with what they call 'economic science' go and study complex systems theory (or related theory of computations, chaos theory etc) and you will be a) on the forefront of modern understanding of economic reality b) will be actually studying Science, not quackery.
Astrophysics/Climate Science/Systems Biology is a pseudo science.
It does not follow the basic principle that knowledge is proved and disproved by experiments. You can find all the sophisticated mathematical methods you want in geophysics, and none of them would stand a test of reality. Most of so called 'models' come with disclaimers against various features, and pretty soon you discover that our whole life is one big exogenous phenomenon.
Your criticism applies to the study of almost any complex multiscale system. The fine scales are poorly understood, and most models come with various disclaimers. Many parameters are unknown, and reasonable quantitative predictions are impossible. Plenty of examples show models to fail, but they are still used since they sometimes work.
Life is messy, and studying a mess leaves you with a messy field. It's a pseudo-science when you stop admitting that, and pretend you have all the answers. I don't know of any economists who have reached that stage.
Mainstream economics refuses to admit it deals with a complex nonlinear system. And econometrics claims it has all the answers through gaussian statistics.
Most econometricians would admit it, it's just that the linear models, and Gaussian models are easier to handle since they require much less data to calibrate, and the results have more or less confirmed economic theory. There is no doubt that economic theory does not have near the predictive power that physical sciences have attained, but that is due in part to how recent new developments have been, and how sparse the data available to economists is. Indeed, estimating all the parameters necessary for non-linear models is significantly trickier. Anybody that developed robust nonlinear economic models could safely bet on receiving a good academic appointment at a top-20 school, and very probably an economic prize.
I can't think of a single econometrician who claims to have all the answers through Gaussian statistics.
I don't think you are aware of much modern economics. In general, the Chicago school exactly takes the viewpoint that one is dealing with a complex, nonlinear and nondeterministic system. Neoclassical economics takes a similar viewpoint.
Thanks for questioning my knowledge. Let me return the compliment. I don't think you are aware of the fact that a complex dynamical system (the economy) is deterministic. The randomness implied by stochastic models does not exist in reality. Complex dynamics looks similar but is a different animal altogether. Attempts to build global predictive models are futile in principle and can be compared to attempts to build a model that predicts the weather a month from now.
Economics needs a philosophical paradigm shift, and of course it is happening (slowly, and Santa Fe Institute is the place to watch), but is it not what you find in Samuelson books and in the mainstream academia. That is the point I am making.
I know a fair amount about dynamical systems. As for whether the economy is deterministic at the most fundamental level, I suppose that really depends on your interpretation of quantum mechanics.
Concerning weather prediction, that's my point. Economics is as much of a science as meteorology is. Economics and meteorology will never achieve the level of simplicity and accuracy that fundamental physics does. Doesn't make them unscientific.
Milton Friedman is an excellent writer. Try "Capitalism and Freedom" or "Free To Choose". Not so much academic discussions about partial derivatives applied to indifference curves, but very informative.
Required reading for one of my economics classes in college. This is an excellent book covering the efficiency of markets. Extensively backed by real world data, this book boils down to some of the best and most prudent investment advice you can get. I re-read it after graduating just because it's a great book.
One option: assume that there is no one book that can serve as an intro to economics (I haven't found one yet) and start learning the subject be reading the 3 great classical economists: Adam Smith, David Ricardo, and Karl Marx. All 3 were geniuses who had many brilliant insights. And all 3 were wrong in a similar fundemental way because they didn't fully grasp the concept of value.
Personally I've found overviews (ie "The Wordly Philosophers") to be useless for real learning.
What I've found instead is that when really smart people are wrong, their wrongness (how and why they are wrong) is just as instructive as when they are right. If not more so.
Once you understand classical economics then learn about the marginal revolution. Follow that by reading Keynes and Von Mises simultaneously.
Almost every notable economist of the last 50 years is, in some form, an intellectual descendent of either Keynes or the Austrians (Von Mises and Hayek). Perhaps directly or one of Keynes -> Galbraith or Austrians -> Chicago School (Milton Friedman).
There are also lots of intellectual descendents of Marx (Thomas Sowell for example) but they tend to just write about economics rather than being actual working economists.
Notable Keynesians: Paul Krugman is an excellent writer and wrote several great popular books in the 90's, I escpecially like The Accidental Theorist. Brad DeLong worked for the Clinton administration and has a blog.
Notable Austrians: The Marginal Revolution blog (directly inspired by "Austrians"), Greg Mankiw (worked for the Bush administration a few years ago, not directly inspired by "Austrians").
These two are my favorite (that are reasonably priced!). Samuelson is definitely a formidable thinker and lays the groundwork for much later economic thinking.
However if you go with the Samuelson, Fridman, and Heilbroner you'll be missing out on some key concepts relating to information and games, which are essential for understanding modern developments in economics.
Finally, the empirical side of economics is quite important, and it is essential for investigating whether the theoretical conceptions (say in Samuelson) actually hold up. There are many bad texts, and the seminal ones (Greene) are quite difficult in the beginning. So, I recommend a pedagogical text that uses the likelihood approach. Although, this is, by no means, a comprehensive text, you can certainly gain an understanding of a basic econometric study
http://www.amazon.co.uk/Econometric-Modeling-David-Hendry-Ni...
If you are asking for introductory economics +1 for "Basic Economics" by Sowell and "Free to Choose" by Milton Friedman (Sowell is one of Friedman's proteges).
PBS made "Free to Choose" into a series back in the 1980s. You can find all the episodes on YouTube.
Get hold of at least two textbooks. In economics even more than elsewhere, each book will give you a different perspective.
If you're feeling really adventurous, pick up a second-hand textbook that's a decade or two old, and keep an eye on how the orthodoxy has shifted.
Which to buy? The best-sellers are all pretty similar: quite clearly written, but maybe longer than they need to be. Mankiw, Samuelson/Nordhaus and Baumol/Blinder all seemed OK to me; I'm not aware of any truly exceptional econ. textbook.
It is an audio course (also avail) on DVD from the Teaching Company now in its third addition. Taught by Timothy Taylor. I've read a lot of economic books and taken a lot of courses, and I believe this is the best introduction.
Not much else to add except I would recommend picking up two books as well.
1. A standard price theory text that will give you the basic tools of economists.
2. A book that provides real-world applications illustrating how these tools are used. (I agree - Basic Economics by Sowell is a great place to start.)
"Economics and Making Decisions", by Kourilsky, Dickneider, Kaplan, and Tabbush. It was the first of many economics books that I have read, and I still haven't come across a better primer.
http://www.amazon.com/Basic-Economics-2nd-Ed-Citizens/dp/046...