Every year I’m asked for book recommendations, particularly from students and friends who want to learn a little more about economics, but who are not ready to start with Adam Smith’s 500-plus page behemoth, An Inquiry into the Nature and Causes of the Wealth of Nations. I’ll admit that I own the book and made it about 20-pages into it before I just gave up on it.
I have students in my upper-level labor economics course read Enrico Moretti’s The New Geography of Jobs and George Borjas’s We Wanted Workers. One of the recurring comments I receive from students after the class is that they were happy I assigned those books because they found them fascinating, but they wouldn’t have read them on their own. The same was true in my Economics of Crime course last spring, which read Shane Bauer’s American Prison and Tom Wainwright’s Narconomics.
A couple years ago, a student club on campus wanted to start a book club centered on economics and business-related books, but wanted suggestions to pitch to their members. To save myself from recommending books I personally enjoy, I reached out to my friends & colleagues in the economics community and solicited their advice on what book they would recommend to a group of students interested in learning more about economics. After receiving 117 replies, these were the top choices among their over 150 different recommendations. Given that I asked in 2017, I wasn’t too surprised to see a variety of recommendations related to behavioral economics, but luckily the options are pretty diverse:
#10 Capitalism and Freedom by Milton Friedman
One of the preeminent books of free markets and the role of economic capitalism. Written in 1962, the book has gone on to sell more than half a million copies worldwide. Friedman is synonymous with libertarianism, and this book was his seminal work.
#9 The Worldly Philosophers by Robert Heilbroner
Ever wonder about the difference between Hayek, Keynes, and Marx? This book covers those differences as well as the philosophies of Smith, Schumpeter, Ricardo, Veblen, and more. If you’re wondering about the technical differences between the schools of thoughts, then this is a great book to read.
#8 Super Freakonomics by Steven Levitt and Stephen Dubner
The sequel to the wildly popular Freakonomics, which was published just a few years prior. Super Freakonomics looks at topics as varied as global warming and terrorism, but kicks off with a look at pimps and prostitutes. While the original version included controversy around abortion-related research, Super Freakonomics received attention because of its discussion on climate change.
#7 Economics Rules by Dani Rodrik
Following the Great Recession, Dani Rodrik takes a deeper look at the role of models in economics research. He highlights both where models explain outcomes, but where our current view perhaps falls short. This book may be one of the better books on the list to discuss how economics works as a discipline.
#6 Naked Economics by Charles Wheelan
Wheelan translates economics issues into a more readable format by people with no prior exposure to economics. The book predominantly covers a lot of macroeconomic material, but does include traditional principles related to the economic way of thinking. Wheelan has a similar book related to to making statistics easier to understand.
#5 Nudge by Richard Thaler
Thaler uses psychology and behavioral economics to discuss ways that policy makers can use “libertarian paternalism” to encourage particular behaviors. Nudges push people toward a particular outcome, but allow people to ultimately make their own decision. Thaler would go on to win the 2017 Nobel Prize for his work in behavioral economics.
#4 Predictably Irrational by Dan Ariely
Thankfully, one of my favorite economics books made the Top 10 list. Ariely looks at a variety of ways that people behave irrationally and contradict many of the models educators present in economics courses. Another really good book, which includes some of the same stories, is The Honest Truth About Dishonesty.
#3 Thinking, Fast and Slow by Daniel Kahneman
Prior to Thaler’s 2017 Nobel Prize, Kahneman had won a Nobel in 2002 for his work in behavioral economics, namely prospect theory. The book covers two general modes of thought: instinct and deliberation. Kahneman references much of his own work in showing how different fallacies impact our ability to make decisions.
#2 Misbehaving by Richard Thaler
In the follow-up to his earlier book, Nudge, Thaler takes a broader approach to using behavioral economics in a wide-range of decision making opportunities. Because of bias, humans are not always the most rational decision makers, and Thaler uncovers familiar examples that readers can find relatable.
#1 Freakonomics by Steven Levitt and Stephen Dubner
This was far and away the leader of the recommendations, and none of my colleagues were really surprised when I told them such. Within just a few years of publication, the book had sold over 4 millions copies! Freakonomics went on to spawn a radio show, podcast, movie, and 3 follow-up books. Honestly, if you’re reading this recommendation list, but you haven’t read Freakonomics yet then you should probably start there.