Tuesday, April 24, 2012

Book Reivew: The Myth of the Rational Market

The Myth of the Rational Market
Author: Justin Fox
Published Date: June 9, 2009
Link:  http://www.byjustinfox.com/the-myth-of-the-rational-market.html

  For how much the title sounds like political ideology, the book itself is actually the complete opposite.  I thought this would be an economic version of Howard Zinn's People's History of the United States (which is much better than it's critics give it credit for), but in truth it's a dispassionate outline of the main characters of western economic thought over the last 100 years.
  The one qualm that I've heard from many other reviewers was that the book is really is just an outline, only touching on the main characters and their ideas lightly.  There is a lot of complicated material and people to cover and the book is only 400 pages long.  If you find yourself tempted to use terms like "Keynesian", "business cycles" and "loss aversion" but suspect you might not actually have a grasp on what they mean, you may find the history of minds that defined these terms illuminating.
  Personally, I found the outline structure provided a great base for learning more about the history of economic thought.  I never took a single economics class in high school, college, or grad school (and it seems I may be better off for it!), so just learning that Irving Fisher lost his fortune in the Great Depression and Hyman Minsky developed his Instability Theory in the 60's, and Eugene Fama recanted his own Efficient Markets Hypothesis in 2004 helps me keep track of just how and when ideas have changed.
  This book is intended for the lay reader and includes almost no math (which is an asset), it seems to me to be a terrific base upon which to build a foundation of historical economic knowledge.

1 comment:

  1. Great post Lewis!
    I didn't think you could convince me to read "The Myth of the Rational Market," but by the end, you at least made me want to hear about the 100 year summary of economic thought from you.
    Did you post this Van Gogh quote or blogspot?
    Either way, that is great too!


"If you hear a voice within you say 'you cannot [comment],' then by all means [comment], and that voice will be silenced."
Vincent Van Gogh