Saturday, October 10, 2009

The Origin of Wealth by Eric Beinhocker

The best parts of Eric Beinhocker’s The Origin of Wealth are (1) an alternate history of economics that argues the foundation is cracking, and (2) a wide-ranging tour of new ideas that Beinhocker calls Complexity Economics. Here is his summary of the old versus the new.

If that table rings your bell, then The Origin of Wealth will be a carillon choir’s worth of bell-ringing for you. At many points, I found myself needing to put the book down to digest the richness of the ideas. (That’s a good thing.)

Less successful is Beinhocker’s attempt to unify the book around a theory of wealth creation—in brief: wealth comes from innovation, which in turn comes from evolutionary processes operating in an economy like Darwinian evolution operates in a biological ecosystem. While there’s a lot to like about this theory, it’s a subset of the Complexity Economics story. As such, it doesn’t really unify the book as much as it confounds itself with other, non-evolutionary aspects of Complexity Economics. Also, Beinhocker is so expansive in exploring Complexity Economics’ implications that he sometimes comes across as throwing stuff at the wall to see what sticks, as opposed to telling us what is sticking.

As a result, the totality of this 450-page book is less than the sum of its parts. However, so many of the parts are excellent that The Origin of Wealth is well worth recommending to those with an inclination toward the subject matter.

Here’s the link to the book at Amazon.

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