Book Recommendations: Everyday Economics

“The Undercover Economist”

by
Tim Harford

The theoretic basics of economics as a succession of supply and demand curves are rather dry and boring. I can fully agree to this rightful and true argument. The extent, however, to which economics influence markets and everyday life is simply amazing. So what could be more promising for a good book than bringing a dull subject to life by relating it to daily business?

This is exactly what Tim Harford has done in “The Undercover Economist”.

Have you ever wondered why there is a Starbucks on every street corner? And why they charge such exorbitant prices for a rather cheap-to-produce thing like a coffee? The answer lies in economics: scarcity power, marginal costs and price elasticity. Not clear? Well, have a look at the book!

The US health care system is highly more expensive than the British system, yet it does supply a much lower service and quality. Why is that so? Because the British have understood that too much inside information and subsequent differentiation in health insurances brings down the overall performance. Not clear? Well, take a look at the book, then!

Upon entering a cinema, how often have you wondered how popcorn & cola can be more expensive than the actual ticket? A clear example of scarcity power combined with a price-targeting-strategy: while some people might abstain completely, other less sensitive visitors are ready to pay almost every price. Still not clear? Then read the book!

“The Undercover Economist” is witty, sharp, enlightening and entertaining, paired with a good dose of British humour. It deals with a supposedly boring subject, yet easily brings it to life in everyday situations that everybody can relate to. The individual chapters make reading easy and worthwhile, be it in short breaks or on long trips.

I have read the book. It has changed some of my views. And it has definitely influenced my behaviour towards Starbucks.

Tim Harford
“The Undercover Economist” in English, ISBN 0349119856
“Ökonomics” in Deutsch, ISBN 357050073X

Andreas Hauser

Management Consultant & Intercultural Trainer

www.developingculture.com