Saturday, October 25, 2008

Book Review: Cardinal Discovery of Incentive Economics

This is my book review of Tyler Cowen book on “Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist”.

For me it is quite interesting as I move towards the basic principles of Austrian economics in a true F A Hayek way of thinking. I loved it with great fun in reading and also with reasons muse.

There are other reviews also and it is not the point to added one more review but its own some unique.

My Review: Cardinal Discovery of Incentive Economics

The cardinal human actions become many subjects over a period of time through the discourse of reasons otherwise the word ‘human’ would have been disappeared many century ago. And the use of common sense is a free (for every one) but important tool that actually helped to frame the once inner economist. To discover that frame has its own motive, objective and incentive to come out some sort of understanding of any actions derived out of once inner economist with other men is a conventional, yet applies in modern as well.  

Men may move to one place to other place to find many things, yet with their inner economists. But no men would live without the reasons perhaps more meaningfully and certainly this may be true with incentive principles also.

Tyler Cowen is Economics Professor at GMU in US. His recent book “Discover your Inner Economist- Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist”, it has ten chapters of which chapter four, five, nine and ten engage readers fruitfully with exiting ideas.

This book is in a way quite readable one, as it gives incentive to know more new methods to discover your inner economist not only when you go out for shopping, tour, how to handle your PhD students energy, getting cured from dentist etc but also when you read books, search of tourist guides etc.

Mr Cowen asks his students to give the postcard version of their new ideas whenever they prose. He has been called as POSTCARD MAN in his circles. This is terrible imposable in Indian universities. I heard even student do all other works in professor house to bring vegetables and drop professor children in schools etc except try to read good literature and bring new ideas to enrich the subject knowledge. Not even they think of debate on any issues.

Interestingly Mr Cowen stresses the most important perhaps a new way to look at the means of using time and attention to discover once inner economist with an incentive so rightly argues that “in our highly civilized society the scarcities I notice most often are those of attention and time”(p.47-48).

He also excites reader with a observation from India like the nurse sells child for some $ but charges more for male child than the female child! It read “In Bangalore, India the nurse often takes away the newborn baby, returning it only when the parents pay a bribe; the price is $12 for a baby boy, $7 for a baby girl” (p. 220).

More importantly he concerns “I faced this dilemma when I first visited India in 2004. I have traveled to about seventy foreign countries…..yet nothing had prepared me for India. Here was extreme poverty on a scale of the many millions. And unlike in most Africa, the crowding was extreme. The air was a mix of smells from burning charcoal, rotting garbage, human urine and excrement. For all the (justified) talk about India on the rise, most of the country still lives with medieval technology but modern levels of crowding”.

And what he typically says that “at first I could not understand why so many of the streets, even there streets with no nearby stores or attractions, were so full of people. I soon realised those people were living on the streets……Calcutta (now Kolkata, but I will use the former and better known name) was the most extreme example of poverty and crowding I encountered. The recent India boom came to Calcutta later than in other parts of India. The surrounding state of Bengal has had socialist and communist governments for a long time, and not to its advantage. Calcutta also appears to have better developed “culture of begging”,…The very poor had had begging “targets” for a longer period of time than in, say Bombay (Mumbai). Walking down the main street in front of my hotel meant being importuned a dozen times within the span of a minute” (p. 187-188).

He also excites reader with the typical information like there was scarcity of stones during a riots then a woman who sold more stones for that riots and earned $70! It read “during one riot in Michigan, one women sold stones to rioters. According to Police, she used the money to pay her cable television bill. Small stones went for $1, larger stones brought in $5 a piece. Most of the rocks were thrown at the police” (p. 220).

In one sense, this book is all about the world is not so flat to find information easily without the incentives and motivations.

If one wants to engage in love, buy banana, get cured from dentist, new idea from PhD student to discover, make tour worthy, to make the world work for you and understand that “given that we don’t have markets in everything, we have to motivate other people, and ourselves to get where we want to be” (p.3).

The book is as simple as with the essential principles of economics-incentive, scarcity, money incentive, non- money incentive but quite pluck bananas from economics of trees.

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