Friday, October 22, 2021

Reading the Classics in Economics

This a the blog version of a tweet thread from earlier today. It was prompted by tweets by Florian Ederer listing the classic texts he had not read and essentially arguing that everything essential is in current graduate textbooks.


Smith’s Wealth of Nations: I read it all, and I can’t say I recommend that. On the other hand, the first two chapters are still one of the best descriptions of markets as a means for large numbers of people, who don’t even know each other, to cooperate in ways that make them all better off. By the way, unlike the book, the chapters are very short. It is free at


Marx’s Das Kapital: Read the first volume. Maybe the good stuff is in the later volumes. I do recommend The Communist Manifesto as a short clear introduction to his theory of history.


Keynes General Theory of Employment, Interest and Money: I read it but can’t say that it had much of an impact on me. It may be that I had encountered most of the interesting ideas before and just found the book a slog. Some people regard Keynes as a great writer, but I didn’t think the General Theory provided evidence of that.


Schumpeter’s Capitalism, Socialism and Democracy: I read it. You should read Schumpeter, but the best place to start is his “The Creative Response in Economic History” in the Journal of Economic History (1947).


Hayek’s Road to Serfdom, Friedman’s Free to Choose and Capitalism and Freedom. Read them all. First two are quick reads. Best reason to read them is to see that while the authors were pro market they were not as anti-government as many of their followers.


Veblen. I’ve read Theory of the Leisure Class and Theory of Business Enterprise, and several of his papers. I do recommend Theory of the Leisure Class, but don’t read it for the social criticism, as many people have. Read it for the argument in favor of a broader economics. Veblen is arguing that you can’t just study the choices people make, given tastes, technology, and resources. You need understand how tastes, technology and resources change over time.

Does all this make me a better or worse economist? I have no idea. I read them to satisfy my own curiosity. In retrospect some of the time spent on Smith, Marx and Keynes could have been better spent on something else.

I think Ederer was in a way correct. The essentials of current economic theory and empirical research methods are in the graduate level textbooks. A person can become a successful economist without reading older texts, but that does that mean they shouldn’t read any of the classics.


I think it would be good for economics if economists learned that what are considered legitimate questions and methods in economics have changed over time. The appropriate set of questions and the appropriate methods for answering them are part of the culture of the discipline, a culture that evolves over time. Current textbooks provide a very limited view of what it means to study how people choose to allocate scarce resources.