• Cocktail and Dinner Party Economics
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  • Dinner Party Economics

She Takes On My World

Books I love. by Natalie MacNeil What can I say but a heartfelt thanks to Natalie for recommending my book to her audience of women? I am glad she loved it!  It seems to me that economics is usually thought of as a male dominated subject (especially finance) but  my book has a definite feminine side…one that women can relate to.  (Just so you know many men have enjoyed it as well.) Let me quote from my final chapter… Well, there you have it.  A few big ideas and a lot of small talk about markets.  I hope you feel more confident during cocktail party conversations.  Even if these kinds of conversations aren’t your thing and you would rather discuss the latest movie or novel, there are still some benefits to knowing this material.  If you happen to be a women, remember that an educated understanding of a subject viewed as a typically male one is like fantastic underwear.  No one has to see it, but you can feel the difference and it changes how you carry yourself.  If you are a man, lightly chit-chatting on these matters with savoir faire is very attractive, especially if you know when to stop.  Cocktail Party Economics pg 168    

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Everything you always wanted to know about Prosperity (but were afraid to ask)

It is precisely because there is so much poverty, hunger and illness that the world must be very careful not to get in the way of the things that have bettered so many lives already– the tools of trade, technology and trust, of specialization and exchange.  It is precisely because there is still so much further to go that those who offer counsels of despair or calls to slow down in the face of looming environmental disaster may be not only factually but morally wrong.   Matt Ridley in The Rational Optimist on page 354 This book had me at ‘feeding the nine billion’! I am a naturally optimistic person and The Rational Optimist: How Properity Evolves gives credence to my inclinations.  I have always thought that humans were capable of solving problems and this book hammers that nail  firmly in place. His basic thesis is as follows.  Humans have the ability to specialize and trade.  This allows more bang for an economic buck and we are never going back to pre-barter days.  Furthermore, since the advent of fast communication, ideas now have sex with one another resulting in an explosion of new technologies.  No DNA to slow things down. This fecundity is the reason so much of the world is better off than it was fifty years ago never mind one hundred years ago.  Except for a few cases of governmental disasters (for example the policies of (Mao,  Stalin, and Mugabe) the average human being would never trade places with their ancestors, even if that ancestor was very wealthy.  For the poor, things have gotten even better. This book is a must read for any leftwing person just so they know the arguments of free market types.

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Making Introductions

(The following is a except from the book Cocktail Party Economics. Footnotes have been removed for formatting purposes.)

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Either write something worth reading or do something worth writing.
~Benjamin Franklin (1706–1790), American politician and polymath I am a woman who is optimistic, extroverted, and an economist. (Oh dear, this sounds like one of those profiles in a dating service. All it needs is … who enjoys long walks on the beach and going to parties.) As frivolous as it sounds, I really do enjoy going to parties: cocktail parties, wine and cheese parties, dinner parties, and ordinary barbecues. Dress-up parties hold a special place in my heart. The more haute, the better. It’s not just the party itself that I enjoy, but I find getting ready for the party fun as well. I can spend hours deciding which of my many little black dresses I should wear; I have more than I need but that doesn’t stop me from buying another. These dresses call to me from the store window as I pass by them. (Let’s not mention shoes, shall we?) Black is such a slimming colour, and it can be accessorized with elegant shawls and jewellery of all kinds. I favour bigger, flashier pieces right now. If writing a book called Cocktail Party Economics requires experience at cocktail parties, then I have it. So, how did I come to the write an economics book? It wasn’t on a dark and stormy night or in a land far, far away. Rather, it all started after attending different social gatherings where, as an economics professor, I am often asked economics-type questions such as:“Have interest rates bottomed out and should I lock in my mortgage?”
  • “As a recent grad, what can I do to get a good job?”
  • “Should the government bail out the car companies?”
  • “What is the subprime mortgage market anyway, and why has it thrown Wall Street and the global economy into disarray?”
Usually, in order to do these questions justice, I find myself having to embark on a five-minute mini-lesson in economics. Since I am at a social affair, I’m not sure people want to spend a lot of time on this. In these kinds of situations, I feel like I end up arming people with random bits of ineffective economic knowledge without providing the necessary context within the big picture. However, big pictures require time to create—time that’s not always available at a cocktail party. On other occasions, the encounters are more confrontational in nature (this can happen after a few too many drinks). During the usual small talk at a cocktail party, an individual might make a bold statement that has something to do with economics. This person might assert any of the following while frantically waving a swizzle stick:
  • “We should stop buying all this cheap stuff from China. It’s costing us jobs.”
  • “How can you drink anything other than fair trade coffee?”
  • “The government is selling the environment down the river by letting power plants buy pollution permits.”
  • “It’s outrageous how much money athletes make.”
It is a difficult party for me indeed if I hear all of these statements on the same night. At some point, I have to decide whether to enter into the fray. If I choose to respond, the ensuing debate can often feel like a “hit and run” encounter that I am sure to regret the next morning. (I have on more than one occasion told my husband to nudge me if the conversation goes on too long or becomes too intense.)

ECONOMICS + COCKTAIL PARTY = A BOOK

Economics is the study of mankind in the ordinary business of life.
~Alfred Marshall (1842–1924), British economist I find that any answers I provide, both to the polite questions and during any ensuing conflicts, end up being unsatisfying mostly because of their brevity. This dissatisfaction with my own ability to communicate economics clearly and concisely during cocktail parties has motivated me to write a book that fleshes out the various conversations I have started at social functions. When I told my friends what I planned to do, they thought it was a great idea for their own separate reasons. But one thing was common: They were all tired of feeling lost when presented with complicated economic news stories or financial discussions. Since most of them do not have the time or inclination to take a university course to learn more, I decided to offer this book as an easy way for them to gain a more complete understanding of economic principles. As well, the book contains illustrations and real-world examples to help make the economic concepts relevant. The footnotes are extensive, sometimes expanding a thought and other times offering a bit of relevant trivia. I also happen to be a “quoteaholic” and have littered the pages with quotations that are sometimes discussed directly in the text or are obliquely connected. (If a quotation doesn’t make much sense to you, I wouldn’t worry about it. There will be plenty more.) I have tried to make my examples and illustrations accessible and make the text as entertaining as possible. I hope it works for you. My friends kindly warned me that the book would have to be fun to read or no one would buy it. Gasp … I definitely did not want to write a book that no one would want to buy. I am an economist, after all. So I asked myself, How can I write a book about economics that is also entertaining to read? To be honest, I didn’t really know. So, I solicited friends, family, colleagues, and even random strangers I met at parties for help, and help me they did. Their every critique, comment, and question caused me to edit my manuscript. (This book has been rewritten more times than I want to think about.) One particularly helpful comment came from my darling husband, who reminded me: “People like stories, and you should add as many as you can.” I took his advice to heart and decided to start every chapter with a party story that in some way connects with the ideas in that chapter. What is unusual about these stories is that I have placed you, the reader, in them. Don’t worry, the scenarios are relatively ordinary party situations and involve believable conversations, so you shouldn’t feel uncomfortable. There’s nothing outrageous.

Thinking Like an Economist

Art consists of limitation. The most beautiful part of every picture is the frame.
~Gilbert K. Chesterton (1874–1936), British author Although one of my goals is to make economics fun to read, this book follows the pattern of a typical introductory text in terms of logic and topic progression. The logic of economics requires a systematic approach in order to truly understand what is going on. Because economics is fundamentally a way of thinking rather than a collection of idiosyncratic examples, after 20 years of telling a particular story I can’t really write an economics book that doesn’t build from the ground up. I want people to learn something about the elegant framework that surrounds all of the interesting applications found in the popular economics books on the market today. Like a great little black dress, basic economic concepts are timeless—relevant during both economic crisis and economic calm. Therefore, while I wrote this book to be understood by people who have never picked up an economics textbook, those who are taking or have taken an introductory economics course will recognize the flow of ideas but without the mathematics. Think of this book as Econo-Lite—enough to give you a buzz but not enough to have your keys taken away from you. For those of you who have no background in economics, don’t worry. This one’s for you. My friends made sure of it.  

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