How Economics Explains the World (US)/ The Shortest History of Economics (UK)

"If you read just one economics book in 2024—and perhaps if you just read one economics book in your life—it should be this book by Andrew Leigh, an Australian economics professor turned elected politician. How Economics Explains the World is a relatively short and easy read, proceeding chronologically from the advent of agriculture to the present day. Underlying it is an immense wealth of scholarship and economic ideas about economic history, the process of growth, and economic concepts like opportunity cost and thinking on the margin that are almost invisibly woven into the fabric throughout the book. As an elected politician, Leigh has continued to publish books that are relevant for the public policy issues he works at on his day job. In this case, the overarching theme of the book is enthusiasm for the enormous progress we have made economically, the importance of economics in helping foster that progress, but also enthusiasm for a more robust social safety and appreciation of the role of government in addressing myriad market failures. In this sense, it feels like a contribution to what many are beginning to call “an abundance agenda”. In 2025 central banks will continue to do the important work they do stabilizing the economy in the short run. Governments should be focusing on the long run, particularly how to increase economic growth and ensure it is more shared and sustainable. The United States has had decent productivity growth but it is terrible in Europe, slowing in China, and mixed in the rest of the world. Technologies like AI offer a hopeful way out of this disappointing situation but ultimately it will take bigger investments in people to advance and harness innovation. These investments in people can also help ensure that this growth is shared. Finally, for growth to be sustainable governments around the world are going to have to start worrying a bit more about high and rising debt levels—and acting a lot more on the threat of global climate change. I don’t expect much or all of this to happen in 2025 but I will keep pushing for it."