'An Economy of Want'

Here you can view the first few chapters (1 to 6) of the book An Economy of Want.

For further information, visit the book website which gives details in various languages of availability of the e-book and print book on Amazon, and of the print book in bookshops and libraries. The e-book edition is occasionally free to download from Amazon for 24 hours - any upcoming dates (PST/PDT timezone) will be listed on the book website.

NOTE: The Contents and Index pages are complete, but content only up to Chapter 6 is accessible. Links to other chapters will be broken; use the 'back' button on your browser if you click on one by mistake.

READ 'An Economy of Want' (sample: chapters 1 to 6) ...

An alternative economics text book

An Economy of Want is an alternative economics text book. Written by an engineer instead of an economist, it explains the fundamentals of economics building from what the economy of any creature must achieve, to the complex human economies that we live in. In doing so, it exposes common fallacies of mainstream economics. It details how while market economies are good at generating endless new products, they are also the drivers of environmental destruction, insecure livelihoods, and a stream of products that have negative consequences for our physical and psychological health.

Two parts

The book is in two parts. The first is an explanation of how the economy works now: a macroeconomics text, but with a difference, and rooted in the environment. You could read it for interest & understanding, with no intention of changing anything. The second part is not neutral: based on the analysis in Part 1, it looks at what changes we would have to make to move towards a fairer and more sustainable economy.

'An Economy of Want' ISBN: 978-1-3999-8588-8 paperback 556 pages, or e-book. Includes chapter summaries, colour illustrations, real-world examples, further reading, index and bibliography.

What's in the sample chapters?

The book starts with how mainstream economics and Marxist economics both place humans centre stage. However, since Darwin we have known that we are just one of the many creatures that have lived on this planet, and they all had economies too: there is no guaranteed future for us any more than there was for dinosaurs or dodos, so we need to understand where the economy is taking us. Several questions are posed that the rest of the book will endeavour to answer, such as “What limits the maximum output of an economy?” and “What is the source of growth and development?”

Chapter 2 looks at the fundamentals underlying all economies, initially considering the economy of a solitary animal. A simple three-ingredient model describes how the level of output is determined by which of the three inputs required runs out first: wants, resources, or work effort. Fluctuations of output in the short term, are due to changes in the amount of one or more of those three, and the immense amount spent on advertising implies that running out of wants/desires is the main constraint for modern economies. The concept of ‘capabilities’ is used to explain long-term change to the maximum that an animal can produce.

Humans are not solitary but live in social economies, so Chapter 3 describes how such societies are governed by extensive rules that affect how the economy functions – for example, the rules around ownership that enable trade and the operation of markets. Governments set and enforce many of these rules, with the cost of government being generally accepted given the benefits conferred in terms of protection of individual rights and property, and services such as health care. The factors that set the relative value of goods when exchanged, are discussed.

Chapter 4 is an overview of markets. Free-market economies have an extensive ‘private sector’ of independent businesses, producing goods and services. Such economies decentralise economic decisions, with producers moving into fields where there is more demand, and consumer-choice incentivising better quality and lower prices. Markets match supply to ‘demand’ but only to financial demand; those without money are ignored. Fundamentalists argue for a totally unregulated market, but in practice all markets have to operate in a legislative environment, and the trend is for greater regulation since as products become more technically complex it is difficult or impossible for consumers to assess quality and safety.

Chapter 5 models what happens in a market as a series of swaps, with money acting as a sort of lubricant that makes complex swaps easier. Viewing the economy as a set of swaps helps us to understand how a change in what one person or business wants (a change in demand), can have a knock-on effect on the rest of the economy – the effect economists call ‘the multiplier’. It also makes it clear that there is no reason to suppose that the economy will naturally tend to full employment: in a very unequal world, production will be at a level at which the wealthy have bought what they want, even if that falls well below the level required to meet the basic needs of the rest of the population.

Chapter 6 looks at what it is like to live in a market economy. In modern societies, most of us play three quite different roles: we are workers who produce goods and services; we are consumers, who shop in the market; we are citizens who can influence society and the economy in ways other than working and shopping. Our double-life as both workers and consumers means that our political interests as citizens can be contradictory.

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The remainder of Part I

There are a further eighteen chapters in Part I. Chapters 7 to 11 cover the dynamics of a market economy: the labour market, labour supply and demand, how labour demand is increased, growth, economic cycles. The next few chapters are about the effects of market dynamics. Chapter 12 covers what happens when disparate economies are connected: the effect on unindustrialised villages, deindustrialisation of established towns. Chapters 13 and 14 look at environmental impacts, and how the economy shapes society. Chapter 15 is about how collective spending is essential to make life beyond the protection of our front door, safe and worth living. Chapter 16 describes the problems that arise when a community is responsible for the well-being of its citizens, but has no or only limited control over the economy. Chapter 17 explains ‘tragedy of the commons’ effects, where individuals or businesses fail to protect the environment or resources because the benefit is only obtained if most or all of them do so, and how only acting together via some level of government, offers a solution to such situations. Chapter 18 describes the well known economics theory of ‘comparative advantage’, but cautions that it should not be the only guide to what a country should produce since it is based on assumptions that may not be met, and takes no account of several real-world limitations. Chapter 19 considers the economic effects of very unequal levels of income and wealth, and describes how in a market economy, a positive feedback effect will tend to grow inequality unless government acts to limit it. Chapter 20 is a quick look at planned economies – their advantages and problems. Chapter 21 is about making good decisions about the long-term future; it calls into question the morality of ‘discounting’ when costs will be incurred many years hence. Chapter 22 spotlights how little the finance sector serves the majority of the population, and how willing it is to focus on short-term profit, evade social responsibilities, and exert undue influence over governments. Chapter 23 covers inflation and money supply, and Chapter 24 summarises what we have learnt in Part I of the book.

And what's in Part II

Part II of An Economy of Want moves on from analysing our existing economy to consider what we might want to change to achieve one that is fairer and more sustainable. Three main chapters cover livelihoods, environmental impact and protecting nature, and the politics of change.