Saturday, January 21, 2012

More economics for skeptics

I've made a few attempts in the past to introduce basic economics to skeptics, as it's an important science that painfully misunderstood in the skeptical community.

As such, I was very happy to stumble across this recent episode of Rationally Speaking, the New York City Skeptic's podcast where author Joseph Heath talked about his book "Economics without Illusions."

It starts off a bit worrying, as the subtitle is "Debunking the Myths of Modern Capitalism" and early in the interview Heath said he didn't take economics classes in college because he thought it was a right-wing ideology.

However, he went back as an adult and the evidence lead him to accept capitalism while still identifying as a progressive. The bulk of the book is six myths the right believes about economics and six myths held by the left.

If that wasn't enough, Heath was eager to share Friedrich von Hayek's lesson that the problem with socialism isn't just getting people to work. It's not motivation so much as information, as he puts it. It's a great summary of The Use of Knowledge in Society.

The interview reminded me of a recent Bryan Caplan piece about "substitution" as an explanation for economic illiteracy. Caplan explained that a lot of positions the economically illiterate hold can be understood as an answer to a different, simpler question.

For example, when asked if the minimum wage helps low-skilled workers, they may give an answer to the question "Would I be happy if employers gave low-skilled workers a raise?"

The podcast is worth giving a listen, which implies the book is good as well.

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