Why Should You Read This Book?

1785 WordsOct 5, 20158 Pages
In the Preface to Common Sense Economics, Gwartney et al ask the question, “Why Should You Read This Book?” The authors answer their own question when they state that this book will “…improve your understanding of a complex world.” Truer words have never been spoken, based upon the knowledge this reviewer has realized in just a few short weeks. Part one of the book outlines the twelve key elements of economics. Part two of the book outlines the seven major sources of economic progress. Part three of the book outlines the role that the government plays, or rather should play, in the previously mentioned economic progress. Part one begins with the basic postulate of economics: incentives matter. The authors explain in easy to understand…show more content…
While researching what would be required to install a well, irrigation pump and sprinkler system for a second home, taking into account equipment, material, time and travel, I concluded that I could hire a local contractor to do the work for less than two overtime shifts [48 hours]. The entire project would have taken me significantly longer, without factoring in the opportunity costs, which I previously did not realize existed. Reading the text not only reaffirmed my decision, it allowed me to understand why I made the choices that I did. The authors go on to explain that “people earn income by helping others.” Although I paid the contractor his asking price, which was similar [equilibrium price] to others in the area, I felt that I had benefitted from the transaction; that he was helping me. I am certain the contractor feels the transaction benefitted him, or at the very least was mutually beneficial. This is exactly the type of order that occurs when “market prices coordinate the actions of self-interested individuals when private property and freedom of exchange are present,” or what is commonly referred to as the invisible hand. Part two focuses on the sources of economic progress. Although easy to overlook as an American citizen, the authors point out the importance of the
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