Review
Why does a country such as Switzerland with a population of 5 million have the same total productivity as India with a population of 600 million? In this book, economist John Kay sets out to explain this to the reader with no training in economics. His central theme is that economic systems are inextricably linked to their social and political environment, and that economic outcomes are largely the result of political structures. John Kay defines economic institutions functioning within a social, political and cultural context as embedded markets, and introduces the concept of the American Business Model as the most successful example of an embedded market. The Truth About Markets hits the mark by making a serious subject accessible without needless simplification. But just as economic systems are linked to political systems the message of the book is linked to the author's clear admiration for the American Business Model. Enron and WorldCom are viewed as minor traffic accidents on the financial superhighway, while inexplicably for a book written and published in the UK (although clearly heavily targeted at the US market) the problems of Equitable Life and the upheavals in the pension and life assurance markets pass unremarked. The relative coverage of European versus US economies is unbalanced; the arguable success of the French political economy is given two pages coverage out of a generous 479, and is summarized as 'social democracy's best shot'. Discussion of the emerging market for Intellectual Property is lightweight, while ethical topics such as the environmental impact of economic activity are not viewed as relevant. Markets are viewed as strictly for serious financial players; important experiments in creating micro-markets using alternative models such as Local Exchange Trading Systems are simply not covered. The author justifies these omissions with the disclaimer that 'this is not a book about moral philosophy or the ethics of markets'. But it is difficult to reconcile this with his description of opponents of the American Business Model in London on May Day 2000 as 'sandal-wearing, bicycling protesters'. John Kay has produced a spirited, informative and very readable justification for the American Business Model. But an economic system based on what the author defines as 'self-regarding materialism' depends heavily on internal checks and balances. More robust self-regulation in The Truth About Markets would have moved it from the 'recommended' to 'essential' market. (Kirkus UK)
--This text refers to an out of print or unavailable edition of this title.
Richard Lambert, The Times
'an ambitious and brilliantly executed book...It is accessible and witty, and it sheds light on the way the world works'
--This text refers to an out of print or unavailable edition of this title.
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by Tim Harford
by David Smith
by John Kay
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