It's a funny business

Economists have long confronted sceptical lay audiences. Bernard Shaw reckoned that if all the economists in the world were laid end-to-end, they still could not reach a conclusion. Investment banks, when despairing of a rational explanation for strikingly misaligned exchange rates, routinely invite economists along to the early-morning briefings for traders, not to offer analysis but to tell jokes. Paul Strathern's book, while duly recognising real achievements and the obstacles to easy answers, does little to relieve this scepticism.

After a brief prologue where the game-theoretic strategies of Dr Strangelove (aka John von Neumann) are introduced as the culmination of half a millennium of economic thought, Strathern, better known for a series of popular books on the history of science (most recently Mendeleyev's Dream ), develops his narrative in 12 chapters, beginning in the 15th century with Luca Pacioli, who taught Leonardo da Vinci the mathematical techniques useful in rendering perspective in painting, as well as providing the first detailed published account of double-entry bookkeeping. This accounting advance, coming some half-century before Copernicus's work on planetary motion and nearly a century before Galileo placed mathematics at the heart of physics, briefly made commerce the most quantitatively intensive intellectual activity of its day, a distinction not to be even remotely approached again until recently. Strathern's approach is first to sketch out a thumbnail portrait of the man responsible for a selected advance in thought, and then to provide an introductory summary of his contribution. Since he has an eye for colourful personal details and possesses the writing skills needed to do them justice, this results chiefly in a series of vivid pen portraits. The accompanying introductory summaries of thought, while often succinctly coherent, are of more varied quality, perhaps reflecting the fact that the intricacies of pioneering economic thought are even more complex than the thinkers' personalities and circumstances. These variations may also reflect the fact that this is Strathern's first published foray into economic thought.

He takes care not to start his narrative conventionally with Adam Smith, but to provide a longer perspective, including fascinating notes on earlier writers not often associated with economic thought - not only the Tuscan accounting pioneer Pacioli, but also men such as Abraham de Moivre (1667-1754), a precocious Huguenot mathematician forced to seek refuge in England after the revocation of the Edict of Nantes in 1685. De Moivre, better known for his contributions to the theory of complex numbers, spent more than 60 years in City coffee houses as a celebrated consultant to insurance brokers on the finer points of applied probability, a calling that did much to ground the fledgling business of insurance underwriting on a firm mathematical basis, a grounding that over time has become increasingly central to successful practice.

With Smith, the personal pen sketches become more detailed, as does the attention given to summaries of thought. Strathern seems most comfortable with the classical economists - Smith, Malthus, Ricardo, Bentham and J. S. Mill, and their great critic, Marx. He also skilfully counterpoints their work with briefer notes on such contemporaries as the Marquis de Condorcet, Comte de Saint-Simon and Robert Owen. For this group, the personal sketches and summaries of thought are also well woven together. With remarkably few well-chosen paragraphs, Strathern is able to convey forcefully the atmosphere of violent repression in the Germany of the late 1840s in which Marx (with Engels's help) developed important elements of his critique of capitalism, together with its political corollaries (such as the Communist Manifesto ).

Strathern's coverage is, however, not proportionate to the volume of economic theorising. Thinkers active in the years before 1900 occupy nearly three-quarters of the book. Those whose work lay mainly in the 20th century receive relatively little attention. Keynes is accorded an entire chapter (in which Strathern makes the extraordinary claim that Franklin Roosevelt was America's greatest president, not least because he vigorously pursued Keynesian policies, despite repeated scholarly demonstrations since 1955 that New Deal fiscal policy before 1940 was neutral to deflationary). Von Neumann reappears in the final chapters, supported by a walk-on appearance by John Nash. Fleeting attention is accorded to Thorstein Veblen, Joseph Schumpeter and Milton Friedman. But despite having considered developments in mathematical economics before 1900, other than von Neumann and Nash, Strathern makes virtually no mention of those who in the 20th century laid the mathematical foundations on which modern economic analysis is conducted, an omission that leaves the book with not even a cursory treatment of Nobel prizewinners other than Friedman and Nash. (Kenneth Arrow is mentioned twice in passing, in connection with the work of earlier theorists Condorcet and Leon Walras.) Nor is the work of the intellectual heirs of the early quantifiers, John Graunt and William Petty, considered.

While informed, this is not a scholarly book. There are no footnotes to sources or a full bibliography. There is, however, a guide to further reading. In summary, there are many more painful ways to secure an introduction to the history of economic thought. If this book leads readers to delve more deeply, it will have served its purpose well.

William Kennedy teaches at the London School of Economics.