Contents Introduction xv L First Principals The Sex Lives of Great Economists 3 Adam Smith: The Canniest Scot 6 Redeeming Karl Marx 9 Keynes: Yes, He Was a Genius, but Was He Right? 13 Marx, Keynes and . Who? 16 Emerson: The Philosopher of the Business Class 20 Aldo Leopold: The Common Vision of Economics and Ecology 23 Frederic Bastiat: For the Provisioning of Moscow ' * ,"w,t 27 The Search for Kondratieff s Wave 30 The New Palgrave: Smelly Cheese for Roquefort Addicts 33 Alsagers Heirs 37 On "Tech-ing It Up" 42 Sand Sketches and Skyscrapers 45 Short-term Sacrifices and Long-term Gains . 48 The Wizard of Ec? 52 Scientists See Vast Changes 55 2, The Older Generation The Original (Lorie Tarshis) 61 How Economics Went High-Tech (Cowles Commission) 63 viii Contents I Enfant Terrible-Emeritus (Paul Samuelson) 71 A Bunch of Kids with Adding Machines (Lawrence Klein) 75 Milton Friedman s Surprising Secret 77 The Professor of "Q" (James Tobin) 81 First Jeff, Now Mutt (George Stigler) 83 A Victory for the Pure Theory Chapter (Gerard Debreu) 85 "Most Will Not Know Who He Is" (Richard Stone) 88 The Architect of the Life-Cycle (Franco Modigliani) 90 The Skeptic's Reward (James Buchanan) 94 Regulating Government (Gordon Tullock) 97 The Man Who Discovered "Technical Change" (Robert Solow) . 100 . For What He Did in the War (Maurice Allais) 103 Gone Fishin (Trygve Haavelmo) 105 Finance Comes of Age (Harry Markovntz, Merton Miller, William Sharpe) 108 The Long Patrol (Ronald Coase) 110 When the Revolution Really Was a Dinner Party (Ronald Coase) • 113 Why You Never Heard of George Dantzig 116 Planning, Hayek, and the CTC (Friedrich Hayek) 120 Why Galbraith Wont Receive the Nobel Prize (John Kenneth Galbraith) 123 From the Chess Set to Project Tipster (Herbert Simon) 126 How the PC Did in the Big Forecasters (Otto Eckstein) 129 The Enthusiast (Dale Jorgenson) 132 A Theory of Everything? (Gary Becker) 136 Janos Kornai: The System Viewed from the East 139 Contents ix The Hidden History of the National Bureau (John Meyer) 143 The Man Who Wrote Books (Charles P. Kindleberger) 147 * An Economy Without a Middle? (Robert Averitt) 151 How a Nuclear Strategist Switched to Climate Change (Thomas Schelling) 154 Hepburn Retires and Is Not Replaced, as Tracy Soldiers On (Caroline Shaw Bell) 157 The Many Lives of Marshall Goldman 161 How Waltham Lost Its Watch Trade (David . Landes) , _If^ . 165 The Economics of Journals (George Borts) 168 Was Oil Ever Really Scarce? (MA. Adelman) 170 . , In Which Japan, like Greenland, Shrinks Some (Robert Summers) 173 The Possibilitarian (Albert Hirschman) 177 3. The Younger Generation * The New New Economics (Paul Krugman) 183 "The Bureau" Feldsteins Power Base (Martin Feldstein) kl 186 The Nobleman Who Stooped to Trade (Franklin Fisher) 189 The Odd Genius Behind "Supply-Side" Economics (Robert Mundell) 192 The Economics of Status: An Old Idea, Reexamined (Robert Frank) 197 The Agency Theory in a Real World (Richard Zeckhauser and John Pratt) 200 How the Bra Was Invented and Other Useful Lessons (Jose Scheinkman) 203 Welfare Reform? Or Growth? (David Ellwood) 207 The Case for Profit-Sharing (Martin Weitzman) 209 The Computer Who Cried Wolf. (William Nordhaus) . 214 The "New Classical" School's First Textbook (Robert Barro) 217 x Contents j A Primer for Democrats Seeking Policy (Edmund Phelps) 220 Why the Mighty Fall (Mancur Olson) 223 Yes, Virginia, There Is a Truth About Taxes (David Bradford) 226 The Thief of Baghdad, Explained (Reuven Brenner) 228 Why Bureaucrats Prefer Quotas (James Anderson) 231 Which Model for Eastern Europe? (David Ellerman) 234 DRI's New Man for the '80s (Roger Brinner) 237 The Games That Nations Play (Avinash Dixit and Barry Nalebujf) 239 How to Stop Cream-Skimming in Health Care (Peter Diamond) 242 First Thing We Do, Optimize the Lawyers (Stephen Magee) 245 A Bully Pulpit for Dukakis* Economist in the Bush Administration (Larry Summers) 247 Is a Class War in the Ofßng? (Lawrence Katz and Kevin Murphy) 251 Economists Take Sides on Trade (Jagdish Bhagwati) 254 "Big Bang" vs. Evolution (Peter Murrell) 257 What We Know (and Dont Know) About the '80s (Andrei Schleifer and Robert Vishny) 260 Political Economy of the First Amendment (Richard Posner) 263 A New Generation of Democratic Policy Intellects (the CBO) 266 Reports of the Death of the Middle Class Are Exaggerated (Frank Levy) 268 Divided, Conquered (Uwe Rheinhardt) 272 The Winners Curse (Richard Thaler) 276 Living as a "Diminished Giant" (Jagdish Bhagwati) 279 The Third Coast (fresh-water economics) 281 Yankees Resplendent, Celtics Rebuilding (Cambridge economics) 284 The Self-Inventors: Clintons Advisers , 288 4. Engineers After the Crash (financial engineering) 295 Rocket Science and Its Dilemmas Are Here to Stay (conflicts of interest) 298 The Money Launderers Stay a Step Ahead (Ingo Walter) 302 Wall Street: An Oral History (Gilbert Kaplan) 305 Where Ignorant Armies Trade by Night (Stewart Myers) 308 A Graduate School for Little Capitalists (James Cloonan) 310 When 2+2 = 3 (Michael Porter) 313 Buy This Junk Bond! Dont Break the Chain! (Paul Asquith) 316 Weird Economics (the Santa Fe Institute) 319 Building a New Zoo (Albert Wojnilower) 322 A "Strong" Man for the Fed? (Gerald Corrigan) 325 At the Head of the Queue (Jeffrey Buzen) 327 How the Financial Markets Went High-Tech (Peter Bernstein) 330 Dau! Dau! Dau! (Oliver Stone) 332 5. Critics Das Appropriation Problem (Philip Mirowski) 337 What the Fuss Was About (Arjo Klamer) 340 The Woody Guthrie of Economics (Seymour Melmaa) 343 The Bear in. My Closet (Robert Reich) 34 Trust-Buster in the Idea Business (Donald McCloskey) 349 Too Little Knowledge: Too Much Leverage (Andrew Kamarck) 352 Never Mind the Second Law (Julian Simon and Herman Daly) 355 Against the Weapons Biz (Walter Isard and Kenneth Boulding) 357 Medicine for Hurry Sickness (Michael Young) 360 Building Pandaemonium (Humphrey Jennings) 363 A Son Charts His Own Course (James Galbraith) 365 On the Issue of the Whole and Its Parts (computational complexity) 368 Telling the Wants from the Wanters (Julie Matthaei) 371 In Which John Kenneth Galbraith Goes Soft on the Corporation and Has Tea . 375 Why Do We Work So Hard? (Juliet Schor) 378 A Voice from the Economic Left (Michael Piore) 381 Questing for the "Bionomic Perspective79 (Michael Rothschild) 383 Species Goldbug« Genus Crank (Howard Katz) 386 Is There Life Before Death? (Staffan Linder) 389 6. Neighbors Much More than Just a Common Scold (Jane Jacobs) 395 Thomas Kuhn: Paradigm Gained—and Lost 398 A Noble Story of Technological Change 401 Francis Reintjes: Reconstructing an Engineering Revolution 405 America: Democracy to Bureaucracy? (John Lukacs) 408 A Knack for "Thick Description" (Theodore Levitt) 412 The Conference Room as the Symbol of the Times (James Beniger) 414 Lessons from the Game of "Life" (Peter Albin) 416 How Long Did Mass Production Last? (David Hounshell) 419 Frank Talk About Class from . Granóla Valley? (Benjamin DeMott) 423 * On the Economic Significance of Noam Chomsky 426 The Odyssey of George Lodge 429 Robert Nozick and the Zigzag of Politics 432 "Somebody's Got to Take the Responsibility!" (Robert Keohane) 435 Rebuilding Beirut (Robert Clark) 438 A Philadelphia Story (Thomas Hughes) 442 A Visual Strunk and White (Edward Tufte) 445 Astronomers^ Ragpickers and J. Maynard Keynes (Stephen Gudeman) 448 Reflections on "Belindia" (Adam Przeworski) 451 The Kennedy School Tries Again (Graham Allison) 453 What Do Corporations Want? (Michael Useem) 456 "The Cumulated Complexity of a Coral Reef" (James Coleman) 458 7. Practitioners The Reflective Practitioners (Donald Schoen) 465 Why the "Greenhouse Plan" Fell Through (Ira Magaziner) 467 Of Kings, Cabbages and Robert Reich (Stephen Sass) ' 470 Why Oxford and Cambridge Want B-Schools (Alfred Chandler, Michael Porter) 474 About Commitment (Pankaj Ghemawat) 477 Preachy tnventors, Inventive Preachers (entrepreneur contests) 480 The Case of a Supersonic Reactor (Moshe Alamaro) 482 Contents In Praise of a New Hero (Jack Bennett) A Man of Girders and Concrete (Frank Davidson) New Thoughts on Liquidity (Harry Ernst) When Businessmen Turn Preachers (Ralph Landau) Tom Peters: Between Arrogance and Terror The Second Draft of History (John Naisbitt) Coupon-Clipper Economics (Paul Hawken) How One Company Died (Max Holland) Acknowledgments Index .