March 22, 2015
Book Review on Common Sense Economics
The book Common Sense Econmoics is a positive attempt at ezplaining a very compicated topic of the econonu and breaking it down into termalogy that is understandable for the common man. It is a simplistic approach to a complicated subjectthat allows the common man into an often misunderstood world of facts and figure . This book opens a dialect and a pathway into a world that some have found rather frightening and unapproachable with easy to read context and friendly compimentary issue that the everyday man could relate as one would read and analyze theis Book. There are quite a few facets discussed in this book in regard to the economy. This book is divided into 4 sections, The first the Key elements of economics, second seven major sources of economics progress, third Economic progress and the role of government, and lastly twelve key element of practical personal finance.
The book begins with a preface and its basic premise
“What you want are the insights of that really matter -- those that will help you make better personal choice and improve your understanding of our complex world and you want those insight to be presented in a concise, organized and readable manner with a minimum of economic jargon. We wrote this book to meet these objectives.” (Gwartney 2005&2010 pg ix.)
The Preface sets the book tone which is an easy laid back read on a lazy Sunday afternoon. It allows the reader to relax and inhale the information as it is given in a easy format that is easy to relate and understand. It also helps the reader understand the duality mind state the country is currently engaged in.
“Two visions are completing for the minds and personal responsibility; the other expanding government, collectivism and dependency, America was founded on the first but the second has been in ascendance for at least a century. Under the first vision, the econmy will be directed by personal choices coordinated by markets; and under the second, by central planning and politics.” (Gwartney 2005&2010 pgX)
The two mindset are of the two ruling political parties of our nations the democratics and republicans , The DNC and GOP , the left wings and right wing , the libels and conservatives of our nation It is a battle of choices which is where the first section of section begins This transparent and comfortable flow continuse thriught the book to its part I , tweleve keys elements of economic. In this section of the book basic economic concpts are explained for the reader. A few that stood out in section one was incentive matters , where the concept that people care about their personal lives , cost and benefits to their lives. that if a person has the right incentive they will do what benefits them and not cost . The same principle applies to business that with the right motivation business will do what in the best intrest of the customer or itself when it benefits the business. Incentives matters applies to buyers and sellers in the gas crisis of 2008 Gwartney says
“ The record high nominated gas prices in the summer of 2008? While alot of people felt the pain of higher prices at the pump, there was no panic in the streets or lines at the gas pumps, why? When the higher prices made it more costly to purchase gasoline, most consumers eliminated some less important trips. Others arranged more carpooling. With time, consumers also shifter into smaller, more fuel efficient cars in order to reduce their gasoline bills. “ (Gwartney 2005 &2010 Pg6) The incentive principle worked, people just adjusted to the lack of supply, there was incentive their to change or pay more. When the lack of change will hurt you finances, it becomes a incentive to change behavior. The sellers of oil reacted as well to the change of the consumer “As buyers reacted to higher gas prices, so did sellers. The oil companies supplying…