I recently read Per Bylund’s short and sweet little introduction to economics. It’s a small book at 132 pages and a fairly light read. It is available for free online at the Mises Institute and hard copies are inexpensive, or even free at some official Mises events.
The book provides a solid introduction to economic theory with a special focus on distinctly Austrian concepts, such as entrepreneurship. It is generally clear and succinct, and manages to make a variety of excellent points on a variety of topics.
A few highlights include:
- Bylund’s point about needing consistency as well as correct assumptions to produce a working theoretical system. On pages 21-22, he notes, “it is possible to produce an internally consistent theory based on faulty assumptions. Such systems can appear very convincing because they are consistent, but they still fail to provide real understanding because every explanation hinges on something that is not true, and is perhaps not even reasonable.” A valuable reminder, even for solid anarcho-capitalists. As Ayn Rand might put it, always check your premises.
- Bylund’s perspective on the “free market,” at the start of Chapter 3, on page 27. “The free market in economics is a model–an analytical tool. It excludes complicating circumstances and influences and allows us to study core economic phenomena on their own so that they are not mistaken for other effects. …The free market model serves the same purpose as studying objects in free fall in physics.” As a physicist, I find this particularly poignant. The idea that the free market is a simplified approximation, with further details to be added as needed is one that is often missing or obscured from free-market texts. Bylund’s perspective here sweeps away any moralistic air of freedom and justifies looking at the free market from the perspective of one wishing to be value-free yet still study free exchange.
- Bylund’s point about specialization on pages 85-86 is especially clear and convincing.
Yet, there are a couple of minor issues that I found in the book. For instance, on page 68, Bylund states, “We cannot compare the subjective values of different people,” which sounds nice and is an attempt to get at the point of subjective valuation, but is not actually true. It would be more accurate to say, “we cannot compare the subjective values of different people numerically,” since, in fact, comparisons of subjective value are made any time there is an exchange: one person values some set of goods A higher than B, and the other person has the reverse valuation.
This reminds me of something I learned from the great Bob Murphy. In one of his podcast episodes, he told a story about an essay he was writing as a student, and his teacher noted that one of his phrases was not technically true, even though it sounded good. The teacher made the case for changing the language from rhetorical hyperbole to something actually true. From this, Bob advised to never sacrifice accuracy for the sake of brevity or rhetorical punch–you’re just creating an opening for careful critics.
One other minor sticking point I have with the book is Bylund’s introduction to intervention. In my opinion, in a book this short, there is hardly time to make an introduction of all the essential free-market concepts, and the section on intervention is an abrupt shift from the clear and basic to the complex. In my opinion, the topic of time preference has not been sufficiently covered, yet the chapters on intervention somewhat assume a fairly solid understanding of it.
This short book only covers the basics, and is not comprehensive. It is light on citations within the text. However, there is a small but excellent “Further Reading” section at the end of the book which makes it valuable even for the educated. This section contains a great collection of more detailed and in-depth works from many important authors, arranged by topic. Bylund made an effort to include a large variety of authors in order to provide the reader with numerous paths for further study. I am fairly well-read for a layman, and I have read less than one-quarter of the books in the list. This section alone makes this book a worthy addition to the bookshelf.
In summary, Per Bylund’s “How to Think About the Economy: A Primer” is a solid, short, clear introduction to free-market economics from a distinctly Austrian perspective. Yet there are enough excellent insights and paths for further study in the book that even the experienced should give it a look.