Books that should be read before starting a Ph.D. in economics

Suppose a young person is going to start a Ph.D. in economics. What essential readings would you recommend prior to this?

In my opinion, the Ph.D. in economics involves a heavy emphasis on tools. But the story isn’t told, about why we are building these tools. The intuition isn’t built, about the world out there that we seek to model. I always joke that economics students who are clueless about reality are like a child studying projectile motion without having ever thrown something into the air.

So I thought it’s useful to pick a set of books that touch on the great themes of the world, often going into troublesome terrain that the models aren’t very good at, so as to lay a foundation of background knowledge and historical knowledge which can pave the way to usefully assimilating what’s taught in the economics Ph.D.

Here’s my compact checklist of books worth reading. Please do suggest books, and disagree with this list, in the comments to this post.

  1. Good capitalism, bad capitalism, and the economics of growth and prosperity by William J. Baumol, Robert E. Litan and Carl J. Schramm.
  2. A splendid exchange: How trade shaped the world by William J. Bernstein.
  3. The elusive quest for growth by William Russell Easterly.
  4. Invisible engines: How software platforms drive innovation and transform industries by David S. Evans, Andrei Hagiu and Richard Schmalensee.
  5. Capitalism and freedom by Milton Friedman.
  6. The great crash of 1929 by John Kenneth Galbraith.
  7. The age of uncertainty by John Kenneth Galbraith.
  8. Exit, voice, loyalty by Albert O. Hirschman
  9. More money than God: Hedge funds and the making of a new elite by Sebastian Mallaby.
  10. Reinventing the bazaar: A natural history of markets by John McMillan.
  11. Readings in applied microeconomics: The power of the market edited by Craig Newmark.
  12. From the corn laws to free trade: Interests, ideas and institutions in historical perspective by Cheryl Schonhardt-Bailey.
  13. Seeing like a State by James C. Scott.
  14. The company of strangers by Paul Seabright.
  15. Information rules: A strategic guide to the network economy by Carl Shapiro and Hal R. Varian.

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