This book explains modern economic theories by exploring the lives and ideas of the greatest economists. Because many of the economic problems of our day also challenged our forefathers, the echoes of Adam Smith and his descendants still speak to us today. To provide a better understanding of their theories, I have used contemporary examples that I hope the reader will find entertaining as well as illuminating.
As any economics student learns the first day, economics is about scarcity and choice. I have chosen to omit many brilliant economists and to focus on the Anglo-American tradition. Thus, Walras, Jevons, Menger, and others receive less attention than they would in a lengthier book. I can only hope that the reader is inspired to pursue these individuals in other texts. To paraphrase Bacon, I aim not to inform ad tedium, but to stimulate the mind briefly yet fruitfully.
I want to apologize to those economists mentioned in this book who are living today. The title, New Ideas from Dead Economists, is not meant to refer to them, their personalities, or their public speaking abilities—although I cannot be held responsible for resemblances. They should take comfort in the honor of being mentioned alongside Smith, Ricardo, Keynes, and others.
I would like to thank a number of individuals and institutions for stimulating my mind and energies. Martin Feldstein and Lawrence Lindsey encouraged this project and asked Harvard students to read a first draft. My students at Harvard listened to numerous digressions on the history of economic thought. Ronald Coase and Milton Friedman provided helpful comments on Alfred Marshall. Not only was Friedman one of the century’s greatest economists, but he was extraordinarily generous with his time, writing me letters outlining his views and introducing me to Coase, who knew John Maynard Keynes and his rivals, A. C. Pigou and F. A. Hayek. Geoffrey Meeks of Cambridge University and Sir Harry Hinsley, past master of St. John’s College, Cambridge, allowed me to wander and ponder the same cloisters of Cambridge, frequented by so many of the heroes in this book. Before writing chapters on Malthus, Marshall, and Keynes, I searched among the medieval courts and halls for memories and mementos of these individuals, and their legacy spurred me onward. In 2009 I returned to Cambridge and spent time at King’s College researching Pigou. I also thank Michael Moohr, who sparked my interest in the history of economic thought.
Another word about Martin Feldstein, who passed away in 2019 and was, as a prominent headline stated, “one of the most influential economists of his generation,” having tutored Federal Reserve governors, Treasury secretaries, and chairmen of the White House Council of Economic Advisers. Former Federal Reserve governor Jeremy Stein called him the “pre-eminent bridge-builder in the economics profession.”1 Marty was bold enough to challenge President Reagan’s Treasury secretary while serving as the CEA chair, and he was kind enough to offer to write a foreword to this book when I was a mere graduate student. Mathematicians often speak of their “Erdos number,” meaning their degree of separation from the prolific and collaborative Hungarian Paul Erdos. Someday, perhaps starting now, economists will share their Feldstein number. I am proud that this book suggests a number 1.
Finally, I thank my family, whose support and good humor gave me hope that I would find a few lessons and a few laughs among the “dismal” scientists. And perhaps the economists wouldn’t have been so dismal had they known my cheerful and loving wife, Debby, and our delightful daughters, Victoria, Katherine, and Alexia, to whom I dedicate this book.