Learn­ing from ideas by great econ­o­mists

Hindustan Times (Lucknow) - - Education - HT Cor­re­spon­dent let­ters@hin­dus­tan­times.com

Dr. Linda Yueh is Fel­low in Eco­nomics at St Ed­mund Hall, Ox­ford Uni­ver­sity, and Ad­junct Pro­fes­sor of Eco­nomics at Lon­don Busi­ness School. She is also Vis­it­ing Se­nior Fel­low at the Lon­don School of Eco­nomics and Po­lit­i­cal Science’s (LSE) for­eign pol­icy think tank, the IDEAS re­search cen­tre, and was Vis­it­ing Pro­fes­sor of Eco­nomics at Pek­ing Uni­ver­sity. Yueh is a widely pub­lished au­thor and her lat­est book, The Great Econ­o­mists: How Their Ideas Can Help Us To­day ex­plains the key thoughts of his­tory’s great­est econ­o­mists from Adam Smith and David Ri­cardo to Joan Robin­son and Mil­ton Fried­man, how their lives and times af­fected their ideas, how our lives have been in­flu­enced by their work, and how they could help with the pol­icy chal­lenges that we face to­day.

For ex­am­ple, she asks in the book: what do the ideas of Karl Marx tell us about the likely fu­ture for the Chi­nese econ­omy? Edited ex­cerpts:

What made you write this book and why did you pick these econ­o­mists?

I was in­ter­ested in writ­ing an ac­ces­si­ble book to help us ad­dress our most press­ing eco­nomic prob­lems dur­ing a time of vast struc­tural change in the world econ­omy. Learn­ing the lessons from his­tory and from great eco­nomic thinkers seemed to be a good place to start. Thus, these Great Econ­o­mists are of an ear- lier vin­tage who were gen­er­al­ists who worked on the big ques­tions such as how mar­kets work and economies pros­per.

How can the ideas of the great econ­o­mists help us to­day? Do they still have rel­e­vance in the 21st cen­tury?

Their ideas can help us in nu­mer­ous ways. Each chap­ter looks at the idea of a great thinker and traces through where that idea came from, and how oth­ers built upon and mod­i­fied it for their own times. But, the foun­da­tions that Great Econ­o­mists like Adam Smith and David Ri­cardo built still un­der­pin the 21st cen­tury econ­omy in how we un­der­stand how mar­ket forces work and why na­tions trade.

Are there any learn­ings from the book that In­dia could ben­e­fit from?

Yes, In­dia is one of the big emerg­ing economies that has trans­formed the global econ­omy away from growth that had mostly been driven by de­vel­oped coun­tries, so it plays a sig­nif­i­cant part in the story of what the world of the 21st cen­tury will look like. The chap­ter on why are so few coun­tries rich may be par­tic­u­larly use­ful to In­dia as it continues to be­come more pros­per­ous. The ideas of Dou­glass North who stressed the im­por­tance of in­sti­tu­tions in sup­port­ing sta­ble eco­nomic de­vel­op­ment and “path de­pen­dence” in cre­at­ing vir­tu­ous cir­cles of growth may be use­ful to In­dia as it fash­ions poli­cies to sup­port its con­tin­u­ing growth.

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