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The famous British economist, John Maynard Keynes, once wrote that "the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist."
Lord Keynes was right about this much-economic theory has far more of a practical impact on our lives than most of us realize. When setting fiscal policy, guiding monetary policy, and modifying financial regulations, policymakers and politicians are fundamentally guided by an ideology. In the current environment there is a lot of debate over what economic theories and financial philosophies are best suited to guide policymakers. The following list represents the "books I wish all policymakers would read" as we navigate through the present economic storm. WORLD readers may just benefit from checking them out themselves!
The Forgotten Man
by Amity Shlaes
Shlaes is in a class of her own these days in understanding financial history. This thrilling analysis of the Great Depression debunks myths we have often heard (mainly, that the New Deal got us out of it).
Economics in One Lesson
by Henry Hazlitt
I cannot think of a more foundational book to learn the basics of economics. His "broken window fallacy" is a classic (you will have to read the book to understand), and readers will finish this book with an understanding of where most economic fallacies come from.
The Road to Serfdom
by F.A. Hayek
The manifesto for free market capitalists; this 20th-century classic grows only more appreciated through time.
Capitalism and Freedom
by Milton Friedman
Of all the books the greatest economist of the 20th century wrote, this one is the most suited for new readers to the field of economics. Friedman's legacy is arguing for the natural integration of political freedom and economic freedom. This book exposes the danger of collectivism not just for the economic problems it poses, but for the threat to liberty it represents.
Economic Facts and Fallacies
by Thomas Sowell
Few books do more to pinpoint the fallacious reasoning that underlies most poor economic policy. Sowell provides readers a concise and easy-to-read summary of what cogent economic thinking looks like.
The Wealth of Nations
by Adam Smith
This historical masterpiece is certainly for those swimming in the deep end of the pool, but every free market defender owes a debt of gratitude to Smith for this paradigm-shifting work. The notion that an "invisible hand" is at work in the marketplace is no longer disputed. Trade between neighbors and countries is almost uniformly accepted as a positive development. The famous British philosopher made the case for both nearly 300 years ago.
by Ludwig Von Mises
Adding another name on our list for those swimming in the deep end, the great Austrian scholar, Ludwig Von Mises, penned his magnum opus to combat much of the dangerous thinking that was making its way across Europe (and America) in the early 20th century. Although he is widely respected for his work on business cycles and recessions (Von Mises believed that poor investments should be "worked out" of society; recessions were good but temporary means of ridding ourselves of mal-investment), his legendary work is no longer studied at American universities.
by King Solomon and miscellaneous contributors
The inspired Word of God provides us in the book of Proverbs more economic wisdom and practical financial wisdom than we could ever imagine. The merits of hard work, the evils of dishonest measures, the consequences of irresponsible lending-no stone is left unturned in this convicting and masterful collection. I truly wish that our society were more versed in some of the great economic books listed above, but at the end of the day, the inspired book of Proverbs provides as much financial insight as most of us would ever need-if only we would heed it.