Book Review: The Price of Everything

While The Price of Everything is a work of fiction, its subject matter is economics and its author is an academic economist. The book was the subject of a recent podcastby author Russ Roberts as part of his regular EconTalk series. So while he chose to package his message in a fictionalized setting, the subject matter is clearly economic. In this sense he follows a path previously followed by the aptly-pseudonymed Marshall Jevons, whose economic murder-mysteries have been around for some years. I remember one of them being assigned reading in an undergraduate economics course. The fact that I remember in itself suggests that fiction may be an effective means to communicate economic ideas.

Roberts' point is that decentralized systems can give rise to emergent order. Through the character if Ruth Lieber, Stanford provost and professor of economics, he lays out the case for the efficiency of prices as system of conveying information. This argument closely follows Hayek's 1945 AER article that everyone should read at least twice. The plot follows two elite Stanford athletes (who are, of course, madly in love with one another, and who apparently are so good that they needn't practice or travel to competition as much as I remember or one would suspect) as they are introduced to and eventually won over by the advantages of market interactions as advocated by the charismatic Lieber.

Roberts scores points on two fronts. First, his underlying point is of course an excellent one. Today smart people around the world are constantly arguing for intervention for one thing or another without fully recognizing the advantages of the decentralized market. That is, change for the sake of change, not change because we can actually expect to improve on the current outcome. Second, he manages to do this in far less verbose fashion than other authors; for example Ayn Rand, who can and does address this topic, would attempt it in no less than 350 pages. See Atlas Shrugged.

That said, while fiction proves a useful vehicle to Roberts, as a piece of literature I am reminded of an English prof who taught possibly the most instructive class that I took in college. I believe that he would have described the structure (and details) of the narrative as "putrid." I agree. This is not good fiction, let alone literature. However, to harp about the tree and miss the forest is a tragedy in this case, since part of the emergent systems argument is based on the advanatges of specialization. Roberts is a full professor of economics at George Mason. If his calling were as a novelist, his life likely would have played out differently.