In this post, we have included an introduction and 10 best economics books for beginners and college students. Economics as a subject developed in the 18th century, when Adam Smith wrote the book, ‘Wealth of Nations’. Economics was originally considered a branch of philosophy and was referred to as political economy till the mid-1850s. Since then the subject of economics has now separated as a separate branch of study in the realm of social sciences.
Economics now deals with the problem of the allocation of scarce resources effectively and efficiently.
In the present age, economics is diversified between microeconomics and macroeconomics along with two distinct streams, development economics and financial economics. The present-day practise of economics has principles which are based on the Neoclassical Economic school of thought.
Another interesting thing to take into account is with respect to the political systems and economic systems which work in tandem. These systems are in accordance primarily with laws regarding private property and government intervention. These are broadly classified into three parts:
- Capitalist society– Private property and the free market.
- Socialist society- Public property and state-owned enterprises
- Mixed – Has values of both Capitalism and Socialist
Now that we have understood economics to a slight extent. Let us look at a list of 10 economics books which will you form a better understanding of economics.
Top 10 best economics books for college students
- The Mystery of Capital by Hernando De Soto – The famous economist Hernando De Soto argues for 4/5th of the world population. In this book, he answers one of the most difficult questions in the modern world. Does capitalism work? And if it does work in the West but then why not for the rest of the world? He opposes the popular view that it is cultural and social differences which determine the economic success of a nation but the importance of property rights that are the main cause for the economic growth of the developed nations. Thus, a country with a properly determined by property rights has a better chance at growth. This comes under the branch of developmental economics. ( Read: Development Studies )
- Predictably Irrational by Dan Ariely – The standard economic model works on the principle of neoclassical economics which assumes that every human is a rational being and takes decision with regards to maximizing his or her utility. In this book, however, Dan Ariely cleverly breaks down how this assumption is not applicable in certain instances such as when we buy free items just because it is free. Through the book, there is a call for economics to take into consideration the theories of other sciences such as sociology, psychology, biology, etc. The book is a treat for someone who wants to understand the contemporary understanding of society.
- Nudge improving decisions about health, wealth and happiness by Richard Thaler and Cass Sunstein- Furthering the case for behavioural economics looks further into the caveats of traditional economics. The feature that really sets this book apart is the fact that it can be read by anybody. You do not have to be an economic scholar to do understand it. This book even dives into subjects such as consumer psychology, liberation, and regulated policies, etc. It explains how ‘anchoring’ of prices affect our choice as consumers. Next time you will buy a book, do not just look at the top shelves, look beneath too. See, book changes perceptions?
- 23 Things They Don’t Tell You About Capitalism by Ha-Joon Chang – The funny thing about economics is that it is constantly changing and in this book, Chang attacks the basis of the free market trade that economists keep on repeating to everybody. Milton Friedman would have loved to have a debate with Chang about this topic. Anyway, in this book Chang argues that it is not internet, more educational institutions or efficient financial markets which are important for economic growth but other factors. Through these 23 points, Chang constructively undermines and destroys the basis of free markets.
- Theory of Moral Sentiments by Adam Smith- Many students of economics sometimes overlook this work of genius written by Adam Smith. The book dissects human being in a scientific way and tries to communicate the basics of our behavior such as empathy, hatred, appreciation and our consciousness. He gives the idea that humans functioning in such a way which leads to living in harmony. For this, a man uses the aid for self-interest but not selfish interest. The genesis for his famous theory of the invisible hand takes place in this book. This is a beautiful book for students of other social sciences as well. It is philosophy at its purest.
- The Wealth of Nations by Adam Smith- The book that lay the foundation for the whole subject is a must-read for all the people. In 1776, Adam Smith building on his previous book, ‘Theory of Moral Sentiments’ advocated groundbreaking ideas such as division of labor, free-market trade, and the invisible hand. Smith asks for minimalist government intervention and the maximum amount of liberty for people. He proves this through the idea of the invisible hand in which he states that people working on their self-interest would automatically be in the best interest of the market due to the same invisible hand. The language might be slightly archaic but then, all good things take some effort.
- Das Capital (The Capital) by Karl Marx- One of the world’s most known books, yet misunderstood by many. Marx attacked the classes, he sensed that it was capital which created the class difference between the bourgeoisie and the proletariats and thus, attacked capital itself. Marx was a brilliant student who understood the practicality of economics and tried to change into a form which would, according to him, be a more egalitarian society. This book looks into the other side of economics, the exploitative side, which we do not pay heed to in normal economic theories.
- Capitalism in the 21st century by Thomas Piketty- The thing is economists are obsessed over finding ways to improve the economy around the world. With most of the economists being capitalism. The author asks the question regarding the income inequality present in the world’s most capitalist country, i.e., U.S.A. Through logos and statistics in them, he shows how since the 1970s, the most earning when to the top 1% earners in the economy. It raises a question regarding the Western world’s so-called success. A must-read for you to either counter capitalism or use it as evidence to back capitalism further.
- Thinking fast and slow by Daniel Kahneman – Don’t we people make mistakes? People are prone to these problems and the standard economic models do not take this into consideration. The Nobel prize winner, Kahneman also suggests that a lot of our decisions as consumers is considered irrational. This book is a must-read for anybody who wants to understand behavioral economics from its roots. Kahneman was one of the pioneers as a critic of economics.
- Freakonomics by Levitt & S. Dubner – Do you think economics is boring? Well, here is the truth bomb. The author tells the same. They break economics down to the basics of it, the praxis of economics in our real life. The problem of teenage crimes has increased since the 1990s. It is essential for us to sometimes, let go of the metaphysical thinking and notice what is obvious. If you are not an Econ and just a leisure reader, this book is for you.