Friday, July 12, 2013

Tim Besley reviews "What Money Can't Buy" by Michael Sandel

Besley likes Sandel's book (while recognizing its flaws): Here's the opening sentence of his review in the Journal of Economic Literature(2013, 51(2), 478–495):

"Michael Sandel’s What Money Can’t Buy (WMCB hereafter) is a great book and I recommend every economist to read it even though we are not really his target audience."

I've written a bunch of blog posts about Sandel's views on markets, and others on repugnant transactions and markets, so I won't go into the details again here.

Let me instead give Besley the last word. Here are two paragraphs from his Final Remarks:

"The timing of WMCB may seem ironic in a year in which the Nobel Prize was awarded to Alvin Roth and Lloyd Shapley for their important work on market design that underpins a large expansion of exchange and matching into domains such as school choice, labor markets, and kidney exchange.
As Roth (2008) explains, the approach that he has taken is sensitive to issues of social constraints on market allocations. For example, he acknowledges that having a role for prices in kidney exchanges offends societal values. So the market design that has been proposed in this setting looks for exchanges that are feasible without prices. Thus, the concerns in WMCB are already taken on board by those who are actively promoting more socially sensitive forms of exchange.
"At the outset, WMCB identifies two obstacles to rethinking the role and reach of markets. One is the power and prestige of market thinking. The other is the rancor and emptiness of public discourse. Most economists will regard the first as well earned and many would gladly take a bow. But it seems hard to dispute that the need to participate in and engage with debates about markets (and governments) is a central obligation of the economics profession. WMCB is to be applauded for supplying both provocation and insight on a wide range of important topics. And it suggests
a range of challenges to which the discipline of economics can respond."

HT: Parag Pathak

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