These two books are completely different in terms of content and approach. Todd Buchholz summarises and surveys from a sympathetic standpoint the works of the great economists over the past two centuries. J. K. Galbraith, in a new edition of a book he first published more than 40 years ago, adopts a more critical stance towards conventional wisdom and advances his own theories on how the economy behaves. But in terms of style, the authors have a lot in common. Both write clearly and elegantly, with touches of humour. Indeed, whether one agrees with them or not, the books are a pleasure to read.
In New Ideas from Dead Economists , Buchholz expounds very elegantly the key ideas of major economists, from Adam Smith and Ricardo, through Marx, Marshall, Maynard Keynes and Friedman and the modern-day rational-expectations concepts. A particularly attractive feature is the way in which ideas of dead economists are illustrated with reference to modern policy issues such as free trade, financial markets, welfare reform, globalisation, and the relief of poverty. Everyone from enterprising undergraduates upwards can benefit from the Buchholz book, which also serves as an excellent introduction for the more general reader.
It is not particularly useful in pointing to the weaknesses of conventional economics, but that is not its purpose. Buchholz sees economics as a science that has made continuous progress since the days of Adam Smith, a position that he argues well. Galbraith's work warrants all of six pages in the Buchholz book, which is admittedly six pages more than most economists. But it is raised only to be dismissed, for Galbraith is decidedly outside the economic mainstream.
For Galbraith, the orthodox view in economics is obsolete. The Affluent Society is a superbly written book, which the author believes overthrows a central proposition of economics, namely, that the market reads the consumer's true demand for goods. He argues that we do not observe this, but instead follow a set of artificial desires implanted by advertisers. Further, since firms invent and instil wants, and wants - as opposed to needs - are not urgent, the government should limit private consumption and use resources to improve public facilities.
These arguments command popular support today. But even to practitioners sceptical of much economics, Galbraith ultimately fails to persuade, for he does not develop a paradigm that can be tested. Nevertheless, the book remains a classic, and the faithful could set it as an exercise for their students to criticise.
Paul Ormerod is chairman, Post-Orthodox Economics.
The Affluent Society
Author - John Kenneth Galbraith
ISBN - 0 14 028519 9
Publisher - Penguin
Price - £8.99
Pages - 6