Ha Joon-Chang: Economics the User’s Guide (2014) PDF

Preview

Summary

A contrast between Ha-Joon Chang and Payne and Philips views on Development. ...

Description

Ha-Joon Chang: Economics the User’s Guide (2014) The first chapter of Ha-Joon Chang’s book “Economics: The User’s Guide” (2014) begins with a rhetoric where the author ponders to define economics. At first, he uses a textbook definition and states that it is simply an area of study. He then later begins to explore the many perspectives of economists who claim that “economics is about the world” (Chang, 2014, p.18) or that economics has an explanation to everything.

However, Chang is quick to dismiss such thoughts and throughout the text, he criticises economists, especially Neoclassical theorists, who think along these lines. He disagrees with the popular notions and brings forth the example of the 2008 financial crisis and the expert's’ inability to find solutions for it as of yet.

He states that economics is “a study of rational choice” (2014,p. 20) and in saying that he adds that most factors or decisions made by individuals affect the economy one way or another and that these decisions are made with a conscious effort to make their own lives better. He explains the concept of money as “a symbol of what others in your society owe you, or your claim on a particular society’s claims” (2014, p.22) and expresses that in order to gain money one must have jobs or gain it through transfers. Transfers can constitute as either currency, goods and services or as aid gained through charities and organizations or even parental support. In addition, he also states that numerous factors can affect the availability and stability of jobs, such as technology replacing human labourers, political decisions and so on.

The availability of goods and services lead to consumption and Chang highlights that the production process of these goods and services are often ignored in the Neoclassical school of thoughts, which focuses more on exchange and consumption. He, therefore, concludes that “economics” as a whole should take into account the many aspects that influence it , such as the subject matter, rather than just the theories and methods. He also adds that there are numerous ways of doing economics and that it should not be constrained to just a few specific school of thoughts but be seen from different analytical perspectives as one would in any other scientific field of study.

Topic Although Chang disagrees with the neoclassical view throughout the majority of the text, some of his thoughts are echoed in Payne and Phillips’ book “Development” (2010). Chang’s perspective of making a “rational choice” and cycles of production come up in Payne and Phillips’ text when they quote Adam Smith and state that individuals make decisions out of their own self-interest, which in turn offsets the market to produce goods that would meet their demands.

In addition, Payne and Phillips state that “the way forward is to move away from the specialist field devoted to development” (Development, 2010, p.5) which is similar to Chang’s rejection of seeing economics as a one-dimensional topic. The authors come to an agreement wherein they suggest that economic situations must be analysed from different perspectives and that multiple factors may affect the supply and demand of products.

Reading this chapter was rather enjoyable as Chang's method of explaining the core context was straightforward and the language was easier to comprehend as opposed to Payne and Phillips, who used rather difficult terminologies that I found hard to grasp upon first reading. His often sarcastic and conversational tone paired with his rhetorical question kept me engaged throughout the reading sessions which further encouraged me to look up similar articles and reading journals related to the topic.

Bibliography Chang, H. (2014) Economics: the user's guide. London: penguin group. Payne, A and Phillips N. (2010) Development. Cambridge: Polity. 1st edition....