Purchase

Amazon

Barnes & Noble

Books-A-Million

Indie BookShop

Ripped Bodice

Add to Wish List

Also by John Cassidy:

How Markets Fail, November 2009
Hardcover

HOW MARKETS FAIL
By: John Cassidy

The Logic Of Economic Calamities

Farrar, Straus and Giroux
November 2009
On Sale: November 10, 2009
400 pages
ISBN: 0374173206
EAN: 9780374173203
Hardcover
Add to Wish List

Non-Fiction

Behind the alarming headlines about job losses, bank bailouts, and corporate greed is a little-known story of bad ideas. For fifty years or more, economists have been busy developing elegant theories of how markets work—how they facilitate innovation, wealth creation, and an efficient allocation of society’s resources. But what about when markets don’t work? What about when they lead to stock market bubbles, glaring inequality, polluted rivers, real estate crashes, and credit crunches?

In How Markets Fail, John Cassidy describes the rising influence of what he calls utopian economics—thinking that is blind to how real people act and that denies the many ways an unregulated free market can produce disastrous unintended consequences. He then looks to the leading edge of economic theory, including behavioral economics, to offer a new understanding of the economy—one that casts aside the old assumption that people and firms make decisions purely on the basis of rational self-interest. Taking the global financial crisis and current recession as his starting point, Cassidy explores a world in which everybody is connected and social contagion is the norm. In such an environment, he shows, individual behavioral biases and kinks—overconfidence, envy, copycat behavior, and myopia—often give rise to troubling macroeconomic phenomena, such as oil price spikes, CEO greed cycles, and boom-and-bust waves in the housing market. These are the inevitable outcomes of what Cassidy refers to as “rational irrationality”—self-serving behavior in a modern market setting.

Combining on-the-ground reporting, clear explanations of esoteric economic theories, and even a little crystal-ball gazing, Cassidy warns that in today’s economic crisis, conforming to antiquated orthodoxies isn’t just misguided—it’s downright dangerous. How Markets Fail offers a new, enlightening way to understand the force of the irrational in our volatile global economy.

Media Buzz

Marketplace - PRI - December 24, 2010
Marketplace - PRI - November 23, 2010
Marketplace - PRI - January 7, 2010
NewsHour with Jim Lehrer - December 28, 2009