New Departures

Trials of a mid-list author

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Posted in 2007-08 Financial Crisis, History of economics Tagged with: ,

This week Economic Principals appears on its website in a new guise. The redesign reflects some changes in the underlying WordPress software designed to make EP easier to read on tablets and smart phones. The Comment function that permitted a malware infestation in the winter is gone.  I was never very comfortable with it anyway. Although EP appears online, it is a weekly column, not a blog. I have added a Letters page. If you have something substantive to say, send it along and I’ll put it up.

The new look reflects a change in stance as well.  Let me explain

EP started out in 1983 in The Boston Globe. A Sunday column was a tradition of the business section. Robert Lenzner and, before him, Peter Greenough had previously occupied the space, writing mainly about financial markets. My idea was that Boston was a center of technical economics, perhaps the world center, and that we could cover the important developments, not parochially, but from the perspectives of other centers – Chicago, California, London, even Minneapolis – and other disciplines. Ronald Reagan was in the White House, Paul Volcker chairman of at the Federal Reserve Board; the business section already was called “Economy.” It was an easy sale.

The editors and I evolved a form, a twice-weekly column: Sundays were about economics, Tuesdays about politics where economic interests were involved. The best stories, I figured, would slowly become books. More slowly than I imagined! – only two over twenty years.

In 1993 NYTimes Co. bought the Globe and, when the customary standstill agreement lapsed in 1999, commenced fifteen years of rough handling of its Boston subsidiary. I quit in 2002 and moved EP to the Web. After a couple of years of trial and error, I hit upon a business model that has worked surprisingly well: reader-supported but available to a wide audience, much like public broadcasting.

Also in 2002, Google, which had itself been without a business model only a couple of years before, learned to put search-based advertising to work. All but unnoticed at first, the new medium quickly destroyed the newspaper industry’s 250-year-old quasi-monopoly on advertising. The value of the Globe plummeted, along with the values of virtually all other advertising-based businesses – newspapers, magazines, broadcast properties.

So, while newspapers of today are somewhat diminished from what they were and are still thinking through their place in an expanding universe, this one-time newspaper column is pretty much the same as it ever was. EP has kept its readers relatively well informed about goings-on in technical economics over the past thirteen years. It has turned out a lot of good stories in that time, participated in some big ones, and, as planned, sent out into the world a third book about some of the most important recent developments, Knowledge and the Wealth of Nations: A Story of Economic Discovery (Norton, 2006), has sold 25,000 or so copies and was translated into eight languages

I began a new book, an account of the slow awakening of economics to game theory after 1960, a pretty interesting story, I thought at the time.  But the project was soon interrupted by the 2007-‘08 crisis – clearly the most serious event in economic life since the Great Depression. Protected from the hubbub by the loan of an office in Widener Library, I was able to read widely and rethink. Only gradually did I understand how much the tradition known as macroeconomics was changing as a result of what had happened in 2008.  I began a new project, a book of news, a much more important story, as it turns out.

But the publishing industry has changed, too. Publishers used to keep fairly extensive inventories of “mid-list” titles, books that had earned their way but hadn’t become best-sellers. In 1979, though, the US Supreme Court, in Thor Power Tool Co. vs IRS, upheld a government ruling that publishers couldn’t write down their inventories simply because they weren’t selling. They had to actually dump them instead.

The attractiveness of publishing mid-list authors declined steadily as a result. W. W. Norton, which published my knowledge book, had signed the next one in the expectation that it would be a general history of a settled field.  The marketers were not enthusiastic when the project turned into another story of recent developments. There is not much room on shrinking bookstore shelves for the stories that most interest me. .

So I decided to try a different approach. Over the next fifteen weeks, I plan to  I’ll tell, in the weekly,  what I’ve learned about how the crisis has come to be understood. Afterwards I’ll make the series available, one way or another, as a book:  The Tardy Product: a History of Economics since 2008 is the titles I’ve long had in mind, after a line from John Stuart Mill:

In every department of human affairs, Practice long precedes Science: systematic inquiry into the modes of action of the powers of nature is the tardy product of a long course of efforts to use those powers for practical ends. The conception, accordingly, of Political Economy as a branch of science is extremely modern; but the subject with which its enquiries are conversant has in all ages necessarily constituted one of the chief practical interests of mankind, and, in some, a most unduly engrossing one. That subject is Wealth.

Meanwhile I’ll have done my journalistic duty – get the story out in timely fashion. I’ll be able to go on to other matters. The weekly will return to business as usual after Labor Day.

There are shorter ways to tell the story.  Others will find them. Even though it is appearing in digital form, my account is geared to the armchair reader who wants a sense of context. I hope the subject matter will sustain the interest of EP’s bulldog subscribers, on whose goodwill and generosity I depend.  Especially if they read the web version instead of the early edition that comes in their email, they’ll find that each chapter consists of several connected little stories, almost any of which might make an ordinary weekly.

The best way to think of The Tardy Product is as an answer to a question. In March 2009, I gave the keynote talk at the first Kauffman Foundation meeting of economic bloggers in Kansas City, Mo. At one point conference organizer Tim Kane asked,

“Who is doing the best job of explaining the financial crisis?”

“I don’t know yet,” I replied, “but I’ll find out.”

And I did.