It's only when I started reading this book that I realized I’ve already read it! Anyhow, I thought I hadn’t finished it the first time around so I read on. This book is similar to Freakonomics in that it looks at every day situations and explores them in a way a layman would not normally have thought about the subject.
It’s a good book but not as good as Freakonomics, that said, if you like to read non-Fiction that educates without boring you to death, then this is one you’ll enjoy.
Example scenarios explored in the book include:
Why coffee joints that sell coffee at daylight robbery prices aren’t actually making much money.
What negative externalities are, for example pollution, and how they should be solved vs. how they are currently solved.
What positive externalities are and how you are benefit from them without knowing it.
What happens when one side in a transaction knows a lot more than the other side, for example when you're trying to buy or sell a second hand car (Akerlof's lemons). This is known as asymmetric information.
What would happen if insurers sold insurance without a deductible (also known as an excess in Britain)? - this is the moral hazard problem.
Personally, I find these kinds of problems fascinating that's why I did my degree in Economics. If you don’t have an Economics degree but want knowledge on some basic economic fundamentals so you can look really smart amongst your friends, grab your copy on amazon.com or amazon.co.uk.
As an business owner I think this is a must-read because when you see what you think is a great opportunity to make money you might actually be wrong. For instance, most laymen would assume that coffee shops in train stations are raking it in because they don't have any competition. In reality, it's probably the landlord of the shops that's enjoying most of that cashflow (The Undercover Economist explains why) so what business opportunity should you be exploring? Opening a coffee shop or owning prime real estate?
Time allowing, I love to read. If I read anything interesting, I will blog about it here.