Extreme Economies

What Life at the World's Margins Can Teach Us About Our Own Future

By: Richard Davies

Narrated by: James MacCallum

A New Statesman best book of the year
A Financial Times best economics book of 2019

An accessible, story-driven look at the future of the global economy, written by a leading expert

To predict our future, we must look to the extremes. So argues the economist Richard Davies, who takes listeners to the margins of the modern economy and beyond in his globe-trotting audiobook. From a prison in rural Louisiana where inmates purchase drugs with prepaid cash cards to the poorest major city on earth, where residents buy clean water in plastic bags, from the world’s first digital state to a prefecture in Japan whose population is the oldest in the world, how these extreme economies function - most often well outside any official oversight - offers a glimpse of the forces that underlie human resilience, drive societies to failure, and will come to shape our collective future.

While the people who inhabit these places have long been dismissed or ignored, Extreme Economies revives a foundational idea from medical science to turn the logic of modern economics on its head, arguing that the outlier economies are the place to learn about our own future. Whether following Punjabi migrants through the lawless Panamanian jungle or visiting a day-care for the elderly modeled after a casino, Davies brings a storyteller’s eye to places where the economy has been destroyed, distorted, and even turbocharged. In adapting to circumstances that would be unimaginable to most of us, the people he encounters along the way have helped to pioneer the economic infrastructure of the future.

At once personal and keenly analytical, Extreme Economies is an epic travelogue for the age of global turbulence, shedding light on today’s most pressing economic questions.

©2020 Richard Davies (P)2020 Macmillan Audio

Well Researched, Well Travelled, Well Told

There are three sets of stories: Survival, Failure, and Future, and each of those sections has three specific locations for the stories. As the subtitle of the book advertises, there are lessons that each of the stories can provide.

The survival group has stories of post tsunami Indonesia, Zaatari (a very large refugee camp in Jordan), and a prison in Louisiana. Examining these locations from the perceptive of how markets work is quite insightful, and those interested in public policy related to those environments would do well to read these accounts.

The failure group includes Darien (a no-man's land between Panama and Colombia), Kinshasa (DRC), and Glasgow. All of these failed for very different reasons, and are all interesting. The future group includes Akita, Japan (extreme aging), Tallinn, Estonia, (extreme efforts at digital government), and Santiago (an extreme wealth distribution).

The author does a nice job of working in relevant economic and other social science literature where it makes sense, but unlike a lot of books, it does not appear that the editor told the author to jam in more content to make it longer. In addition, he is well versed in economics, and while he clearly supports the vibrant markets that he observed in Zaatari and Indonesia, he also details the harsh impacts of the market oriented policies and income inequality in Santiago and the failure of the market in Darien. So while the examples are 'extreme', he is not an extreme economist on one or the other side of the ideological spectrum.

From work and other interests, I have connections with a number of these places and issues, so I found this book to be very useful. But even for those who didn't have prior interests in these specific locations, it is still a very good read. Few people are likely to get to most of these places, much less do the kind of systematic interviews and analysis performed by the author.

In terms of the audible reading, the narrator does not get in the way of the story and has an English accent as well as a Castilian accent in the sections reading Spanish place names, etc.

Of course, like any audible book, it does mean that you want to refer to a map or photos about those locations, but that is probably a good sign rather than a criticism. I also appreciate that he doesn't bother listing the http address or constantly mentioning "the accompanying PDF", those are just annoying. We know how to find maps and photos.

I read (listen to) a lot of economics titles in the vein of this book and freakonomics, etc., and this author found a good approach and did a really good job on it.

Santiago chapter is 1 star; rest of book 4 stars

Davies explores fascinating economies all over the world, bringing light to issues not covered very well elsewhere. At the same time, Davies takes unfair shots at free markets because he doesn’t even try to address what free market advocates would say. He just runs with his inequality narrative which is light on both facts and logic. No free markets advocate believes you can just set markets free and everything will work: *Without* property rights, *without* low-corruption courts / agencies, and *without* basic institutions, you won’t see as much success. Davies should have explored Hong Kong to see this for example. Free market capitalism has multiple *pre-requisites* for success.