Recommended Reading For An Econ Major? Vol. Paging Rexalongorium, Dey Know Ayo, etc

1,987
10
Joined May 3, 2009
So I'm an economics major and I really love the stuff. I'm looking for good books for additional reading. Any recommendations?
 
353
11
Joined Nov 11, 2004
Confessions of an Economic Hitman

after you're done with that..

read A Game As Old As Empire
 
4,629
12
Joined Apr 1, 2009
My dad gave a book called "Lifetime Economic Acceleration Process, The Key To Financial Success" by Robert Castiglione.

Changed the way I think about money.
 
4,391
7,671
Joined Jun 28, 2004
Despite you butchering my name, I am flattered that you're asking me what you should be reading.

The short answer is, everything. You should be aware of everything past and present.

Knowing everything is, however, impossible so I'll recommend material to which you should give priority and also tell you what books are valuable butshould not be given top priority.

If you want to be good with economics, you need a rock solid foundations so focus on doing well in your intro classes and also check out Thomas Sowell'sBasic Economics. Even if you have finished a few courses in basic Economics, his book is so good at focusing and centering your mind and putting youin a good position to handle all sorts of more complex and advanced questions.

After getting your feet under you and mastering the basics, realize that a competent student of economics and the world in general understands SpontaneousOrders. Become as acquainted with them much as possible and works by people like Hayek and Mises will help you to see how Spontaneous Orders government ouractions and hold societies together. You should also check out books likeFreakonomics soyou can see how spontaneous orders and economic logic applies to everything that people do.

Beyond that, check out the news, check out the myriad blogs that are written by established Economists and also read lots of history, especially books that arebroad in scope. Books like Guns, Germs and Steel and A History of Force are of immense value because they give us a view of how humans havetried to organize themselves in the face of what was in front of them at the moment.

When you are getting good with economics, do not dedicate too much time to financial materials. Get the solid economic foundation mastered, lay down thephilosophic and intellectual corner stones and then proceed to learning how to win at investing.


That is just my own opinion though and I will readily admit I am strongly influenced by the idiosyncrasies of my professors and the fact that I am prettystrongly committed Hayekian student of Economics.
 
473
10
Joined Mar 11, 2004
Originally Posted by Rexanglorum

Despite you butchering my name, I am flattered that you're asking me what you should be reading.

The short answer is, everything. You should be aware of everything past and present.

Knowing everything is, however, impossible so I'll recommend material to which you should give priority and also tell you what books are valuable but should not be given top priority.

If you want to be good with economics, you need a rock solid foundations so focus on doing well in your intro classes and also check out Thomas Sowell's Basic Economics. Even if you have finished a few courses in basic Economics, his book is so good at focusing and centering your mind and putting you in a good position to handle all sorts of more complex and advanced questions.

After getting your feet under you and mastering the basics, realize that a competent student of economics and the world in general understands Spontaneous Orders. Become as acquainted with them much as possible and works by people like Hayek and Mises will help you to see how Spontaneous Orders government our actions and hold societies together. You should also check out books like Freakonomics so you can see how spontaneous orders and economic logic applies to everything that people do.

Beyond that, check out the news, check out the myriad blogs that are written by established Economists and also read lots of history, especially books that are broad in scope. Books like Guns, Germs and Steel and A History of Force are of immense value because they give us a view of how humans have tried to organize themselves in the face of what was in front of them at the moment.

When you are getting good with economics, do not dedicate too much time to financial materials. Get the solid economic foundation mastered, lay down the philosophic and intellectual corner stones and then proceed to learning how to win at investing.


That is just my own opinion though and I will readily admit I am strongly influenced by the idiosyncrasies of my professors and the fact that I am pretty strongly committed Hayekian student of Economics.

Rex, I remember us having a long aim convo a long time ago. Do you still believe in efficient market hypothesis? Just wondering because I just got back fromthe berkshire hathaway shareholder meeting and have been banking in the market lately (knock on wood). Just curious...
 
4,391
7,671
Joined Jun 28, 2004
CjMoney wrote: [hr][/hr]
Originally Posted by Rexanglorum

Despite you butchering my name, I am flattered that you're asking me what you should be reading.

The short answer is, everything. You should be aware of everything past and present.

Knowing everything is, however, impossible so I'll recommend material to which you should give priority and also tell you what books are valuable but should not be given top priority.

If you want to be good with economics, you need a rock solid foundations so focus on doing well in your intro classes and also check out Thomas Sowell's Basic Economics. Even if you have finished a few courses in basic Economics, his book is so good at focusing and centering your mind and putting you in a good position to handle all sorts of more complex and advanced questions.

After getting your feet under you and mastering the basics, realize that a competent student of economics and the world in general understands Spontaneous Orders. Become as acquainted with them much as possible and works by people like Hayek and Mises will help you to see how Spontaneous Orders government our actions and hold societies together. You should also check out books like Freakonomics so you can see how spontaneous orders and economic logic applies to everything that people do.

Beyond that, check out the news, check out the myriad blogs that are written by established Economists and also read lots of history, especially books that are broad in scope. Books like Guns, Germs and Steel and A History of Force are of immense value because they give us a view of how humans have tried to organize themselves in the face of what was in front of them at the moment.

When you are getting good with economics, do not dedicate too much time to financial materials. Get the solid economic foundation mastered, lay down the philosophic and intellectual corner stones and then proceed to learning how to win at investing.


That is just my own opinion though and I will readily admit I am strongly influenced by the idiosyncrasies of my professors and the fact that I am pretty strongly committed Hayekian student of Economics.

Rex, I remember us having a long aim convo a long time ago. Do you still believe in efficient market hypothesis? Just wondering because I just got back from the berkshire hathaway shareholder meeting and have been banking in the market lately (knock on wood). Just curious...

That is a great, great, great question. I really love this subject because I have spent years studying economics and I am now working in finance and the topicbinds the ivory tower with the towers of glass and steel abut it also divides department chairs from fund managers. For me personally, it is the true nexus ofthe philosophic and intellectual world of academic economics with the aggressive and practical world of private finance.

A year ago, I would have said that they were almost perfectly efficient with very little deviation. A combination of wild market fluctuations and actuallyworking in capital management and seeing how our clients and even other investors act, has shown me that there is a great deal of exuberance and despair -animal spirits to steal a phrase from JM Keynes - that causes a good deal of irrationality. With that said, the EMH still holds a good deal of weightconsidering how financial markets satisfy many perfect market conditions so the prices communicate the value of assets quite well and while some of thevolitility in financial markets have been caused my irrational exuberance and irrational despair, much of the swings have been caused by imperfect informationand regime uncertiainty so in those respects the EMH holds true.

Overall, the EMH is similar to most economic theories, it is a useful abstraction that hits the target but rarely scores a bullseye. Capital generally findsits highest valued uses and assets prices usually approximate the value of an assets fairly well. At the same time, information is never perfect nor are peopelperfectly rational and that craetes deviations from the theory and inefficient allocations of capital and it is up to folks like us to profit from it.

If you see "Roy Anglais" on AIM hit me up or PM me because the EMH is one of my favorite topics and I would love to talk more at length with youabout it.
 
4,391
7,671
Joined Jun 28, 2004
AllDay AllNight wrote: [hr][/hr] I've always had tremendous respect for Rex.

Thank, I appreciate that a great deal.

BTW, are you from the Valley, went to CSUN or are from the Valley and Went to Cal, or am I confusing you with someone else? Also, didn't you throw out theidea of us getting some lunch at My Hero Subs in Northridge? That was few years ago but I couldn't get a hold of you because you had your PM turned off. Ifyou're around the LA area right now, I'd be down to meet up. My experience with meeting NTers who are cool on NT is that they have been cool in personas well.


Also, Craftsy, do not get too down on yourself, you are a smart dude who picked a good all around major, fro ma career standpoint. This has not just been a badrecession but it has been especially difficult for people like us, who are trying to enter the labor market. Unemployment is not extraordinarily high ingeneral but almost all of the unemployment has been caused by the fact that almost no hiring is happening. In past recessions, there has been net job lossesbut normally it involves even more layoff than the this recession but with firms still doing some degree of hiring.

Given the lack of confidence across the economy, the extreme feelings of insecurity and anxiety, the unpredictability and tightness of credit (interest ratesare lower than they were in many previous economic booms) firms are generally standing pat and not hiring. So unlike past recessions, people ,who already havejobs are safer than employed people in other recessions but people without a jobs are in a worse position than other periods where the rate of unemployment wasequally as high.

I am sure that everyone has said "hang in there," I will not join that chorus and instead I will give you something that resembles actually good newsor at least cause for tentative hope and optimism. The yield curve is positive for the first time since 2007, new jobless claims have actually fallen recently,capital goods orders in April were higher then any month since 2005, consumer confidence has increased after several months of decline, home prices haveactually begun to increase (demand was up a few months ago and the supply of housing stopped expanding in 2008) and many of the ARM driven foreclosures haverun their course so many toxic assets will come up devalued but with the uncertainty waning they will no longer be worthless.

All of these are leading indicators that have historically signalled the beginning of the end of a recession. Furthermore, the nature of this particularrecession means that with pent up demand and delayed and deferred hiring and investment by firms, we may not crawl out of this recession, we may very wellexplode out of it and the labor market could prove to have a much shorter lag than past recessions. Also, for what it is worth, Google searches for "GreatDepression," "since the great depression," "recession" and "worst economy ever" have declined to near zero, off of theirpeak during the winter. At the same time, the phrase "green shoots" have been appearing and multiplying in respected financial publications. Again, Iqualify this by saying, for what it is worth.

On a deeper level, still feel proud of your education. AS a financial assets, your degree is not yielding what you expected it to and that has been the casefor many graduates, However, your degree will yield higher lifetime earnings, especially later in your working life. Also, try to take pride and find happinessin the non pecuniary benefits of your education. Relative to how you would have been with out your education, you are better able to read and understandingvarious items, you are better able to articulate ideas, you are a more interesting person in social situations because you can conserve about broader range ofsubjects, you can enjoy and appreciate literature and historical texts and financial publications, you are equipped to better and more methodically consideralmost any problem that will cross your path, you are now part of a centuries' old tradition and debate about some of life's deepest questions, youprobably have made friendships you would not have otherwise made (most people's life long friendships are started in college) and finally, your degree cannever be taken away from you. The world can change, calamities can and will happen but you are college graduate and that fact is as immutable as any other factin the Universe.

Until you get a job, use the time to prepare your mind and body for the demands of a career. Stay in shape, use the time off to get in better shape and run,run and run because when you do get that corporate job, endurance and persistence are paramount. Also, do not let your mind get dull. Keep the blades honed andread, read things you have wanted to read but did not have the time to do so. In addition to financial and economic blogs, articles, journals and books, readliterature and poetry and history and philosophy. Give yourself and purpose and since you spent years striving to finish college, try to simulate that. I didthose things when I was unemployed after school and it helped me keep my sanity while I was unemployed and it helped me when I finally did get my job.

Good luck, you got all of the skills, if you keep at it, very good things will happen for you.
 
783
10
Joined Apr 4, 2004
Surprised no one said the Wealth of Nations.

The Economic Way of thinking is a school book, but an excellent read.

If youre interested in different ideas especially politically and economicly you may want to consider Hamilton's Curse, a book on Alexander Hamilton, histhinking and how it's playing a part in modern economy.

Also if you'd like a change, Russell Roberts writes novels with economic themes that seem to be well liked.

I urge everyone to check out cafehayek.com, Boudreaux was my Micro professor and a bad *++
 
4,391
7,671
Joined Jun 28, 2004
da703trailblaza wrote: [hr][/hr] Surprised no one said the Wealth of Nations.

The Economic Way of thinking is a school book, but an excellent read.

If youre interested in different ideas especially politically and economicly you may want to consider Hamilton's Curse, a book on Alexander Hamilton, his thinking and how it's playing a part in modern economy.

Also if you'd like a change, Russell Roberts writes novels with economic themes that seem to be well liked.

I urge everyone to check out cafehayek.com, Boudreaux was my Micro professor and a bad *++

Oh man, I am green with envy at you. My favorite Economics blog is Cafehayek and Roberts and Boudreaux are most amazingly good economists, whohave played a huge role in how I think about Economics. I read Cafehayek every single day without fail.

The fact that you got to spend a semester with one of those guys as your professor must have been a transformative experience. I hope you asked lots ofquestions and took advantage of office hours. Are there any particularly funny or memorable moments in that class that you would like to share with me andother NTers who appreciate what the guys at the Cafe do? Did you also get to have any classes with Dr Boettke, Williams or Kaplan? I would love to studygraduate level econ because of the level of and type of talent in that department.

Also, I did not know that professor Roberts has written multiple novels. I am only aware of The Price of Everything. I have not read the whole bookbut that is a great book for anyone who has not been taught a good deal of Economics and wants to self teach him or herself some Economics.


Regarding the very old Economics books, like Wealth of Nations, Idn Khaldun's and Bastiat's works and the works of Marx and Engels it is agood thing to read if you have the time. It is not essential, IMO, because anything written about Economics before the 1870's and Carl Menger, were writtenbefore subjective valuation and marginalism were common knowledge. Some of the first generation Austrian books and even The General Theory also fallinto the category of good to read but not essential because the impact of those works is channeled through improvements upon and commentaries about theoriginal Austrian and Keynsian texts.
 
5,362
375
Joined Jun 17, 2006
I just decided to minor in Economics a couple of weeks ago (my major is Finance). I'm gonna have to check out some of these books recommended this summer.

I picked up The Wealth of Nations on Saturday, and I plan to start reading it on Monday after I finish finals. Rex, you said it's really not an essentialbook to read, but are there certain parts that you would recommend checking out?
 
3,428
10
Joined Jan 30, 2008
lots of good stuff in here

anyone have a job that involves econometrics?

I hated it when I was taking the class, but looking back the topic was very interesting
 
4,391
7,671
Joined Jun 28, 2004
It is difficult for me to name certain pages to read and those which are not especially important to read in The Wealth of Nations. I would saythat if you are read it, keep an eye out for Adam Smith's views on trade and his views on what makes society do well and what makes societies fail to dowell.

On trade, he makes a huge contribution to Economics by talking about what we today call comparative advantage. Everyone knows that advantages can be derivedfrom trade but Smith makes two less obvious points. One is on comparative advantage, the notion that even if one party is able to produce any good at a fasterrate than another party, that the less productive party has something to offer the more productive party. If the overall more productive party generalized, heor she would be spending time making other goods instead of making the one good that he or she can make especially quickly. As a result, the overall lessproductive party can specialize in the good it can produce most effectively and so can the other party and the overall wealth produced between the parties isgreater with them specializing then if both generalized. The other notion he underscored about trade is that most trade does not involve ships and exchanges ofexotic goods with people in faraway places. The bulk of out trade is routine and local.

Overlapping with that idea, he explains how greed benefits society. Gordon Gekko's speech in Wall Street was a a partially yet ultimatelyunsuccessful paraphrasing of Adam Smith's notions about greed. Greed can be good, given the correct set of conditions. When exchanges are voluntary, thereis a reasonable degree of information in the marketplace, fraud is kept to a minimum, law and order is established, contracts are honored and people can keepthe fruits of their labor but cannot take the fruits of any else's labor, greed will have the effect of raising everyone's standards of living. Thegreed on the part of one person compels him to better serve his fellow man so that he will have a higher income and can be better served by his fellow man.

The biggest weakness of his book is that he lived before the "water-diamond paradox" was solved. He did not know how prices emerged in a freeeconomy, his best guess was that it was a function of how much labor went into producing that item. He was a good enough scholar to state that he did not havethe answer but that is why I disagree with the notion that he was the "Father of Modern Economics."

In my judgement, Carl Menger ushered in modern Economics in 1871 by giving the world a clearly articulated notion of marginalism of declining marginal utility,each additional item of something consumed in a given time period gives you less enjoyment then the previous one such as the first cold bottle of water on ahot day gives you more enjoyment than the second one and second gives more enjoyment compared to the third. He talked about rising marginal cost, where after acertain point, a firm incurs alarger and larger cost, per unit, for each additional item it produces. Declining marginal utility explains why quantity demandedfalls as prices increase. That, in turn, tells us that firm's have declining marginal revenue where eac haditional item sold brings in less revenue thenthe previous item. These notions of increasing and increasing values at the margin provided countless explanations for so many forms of human behavior, whichthe Economists of the past could not understand nor explain.

Menger also gave us the idea of subjective valuation, which is that demand is driven by willingness to pay. Therefore, the value that exists for any good is inour collective heads. This heped to solve the "water-diamond paradox" which Smith could not explain. The reason why the price of diamonds, a shinystone that we cannot eat or drink or use to cure any forms of sickness, is so hig hand the price of water is so low is because society believes that diamondsare extremely valuable. Also, water is very plentiful for most people and the valuation we have on a good at the moment is our least valued use for it. That iswhy for most people, water is very cheap because if we had less water we would loss the ability to hose down the driveway, not a very big decrease in ourquality of life. If we lost more water, we might have to have no grass on our lawn, that is a bigger lose than not getting to hose off the drive way. If youget it so we do not have enough water to drink, then we would trade diamonds for water because then we have a situatio nwhre water is scarce, losing that lastunit of water would mean death. That is common knowledge today but even among luminaries like Adam Smith, it was a paradox with no solution unavailable.

I would actually put The Wealth of Nations in the same category as The Communist Manifesto and Das Kapital. They are well worthreading, just not essential because they are both written before, the Water-Diamon Paradox was solved. Because Marx and Engels were Economists in the mid 19thCentury, they actually understood prices and their role better than did Adam Smith. I find it to be one of history's greatest ironies that Adam Smith, theicon of free market economics, beleived that the value of an item was based on the amoun tof labor that went into makin gi tand he would have been more likelyto support modern day minimum wage laws then would Karl Marx, the scion of far left Economic thought. When discussing the fact that prices are the mosteffcient way to allocate scarce resources, Karl Marx, sounds like the polar opposite of what most self identified Marxist would say today. Even moreironically, when he said what would happen in a society that outlawed prices, he predcited exactl ywhat happened in the Soviet Union, an excess of some goodsand shortages of most other goods. If only communist had actually read the all of Marx and Engels.

If yo uwant some really old but relavent readings, you migh twant to peruse the writtings of Ibn Khaldun. He was a Musli mscholar from 14th Century NorthAfrica and he was the great grand father of all social sciences (aside from history of course). He was an historian, demographer, economist, sociologist andpolitical scientist. He was absolutely brilliant and he came up the idea of a generation and a generational gap and intergenerational strife. He formally founddistinctions between urban and rural. He identified barbarians conquer the cuvilized, the barbarians become civilizaed and then are invaded by other barbariansand the cycles repeats for those new conquerers.

He gives us ideas concerning how we aggregate peopel based on various tribal, religious, ethnic and political lines. In economics he gives us a pro-Laffercurve by stating that a king who was once a wanderer in the Desert conquerers an established and civilized place. He takes taxes and uses the taxes to live anincreasingly lavish lifestyle for hismelf and his court and eventually he demands such a high tax rate that his subjects hide their wealth, move out of thekingdom or rebel and he loses everything by demanding everything. He also talks about what we would call busines cycles of booms and bust in aggregate demand.

Aside from those three and Friedrich Bastiat, the 19th century French Economist who said of free trade and its effect on world peace "if goods are notallowed to cross between two countries soldiers will." There is not all that much that essnetial or even very valuable i nEconomics that is pre1870's.

This is not to imply that Economic history is not important. Economics analysis of history well before 1871 is very interesting, key to understanding patternsof economic development as well as giving the student of Economics mountains of empirical examples of a whole variety of Economic concepts. The distinctbetween Economic history and regulat history is that in regular history, one should give a lot of weight to rimary sources and i nsome instances, a majority ofthe attention should be given to primary sources. In Economic history, you almost always want Cliometrics, which is the work of scholars to translate dispiratepieces of written data as well as archeological findings into workable pictures of standards of living in any period of history before the 19th Century.

Unlike in other fields, the amount of valuable Economic literature tends to increase expotentially the closer one gets to our own day and age. Unlike someother fields, havi nag bias towards the modern is very rational in Economics. Again, however, like any economic decsions, you want to ration your time to ithighest valued uses. If you happen to have a summer where you have lots of free time, by all means use it to read Smith, Marx, Engels, Khaldun and Bastiat.
 
4,391
7,671
Joined Jun 28, 2004
I did, I graduated in 2008.

I am still pissed that, our basketball team failed to make the Tournament the years I was there but then made it after I graudated and could not sit in thestudent section.


Why do you ask? Were you one of my classmates in Econ or History?
 
538
12
Joined Jul 7, 2002
Originally Posted by Rexanglorum

AllDay AllNight wrote: [hr][/hr] I've always had tremendous respect for Rex.
Thank, I appreciate that a great deal.

BTW, are you from the Valley, went to CSUN or are from the Valley and Went to Cal, or am I confusing you with someone else? Also, didn't you throw out the idea of us getting some lunch at My Hero Subs in Northridge? That was few years ago but I couldn't get a hold of you because you had your PM turned off. If you're around the LA area right now, I'd be down to meet up. My experience with meeting NTers who are cool on NT is that they have been cool in person as well.




Definitely from the Valley, definitely went to Cal. Your memory is elephantine


I'd definitely be down to meet next time I'm in town. I'm currently in the Bay Area...stayed here looking for work after I graduated...and I'mstill looking


You'll be getting a PM from me soon sir.
 
Top Bottom
  AdBlock Detected

Sure, ad-blocking software does a great job at blocking ads, but it also blocks some useful and important features of our website. For the best possible site experience please take a moment to disable your AdBlocker or head over to our upgrade page to donate for an ad-free experience Upgrade now