Book Review: ‘Naked Economics’ by Charles Wheelan

By Ryan Quade

Charles Wheelan—professor, author, grassroots activist—harnesses the powerful concepts of economic theory to help you solve real problems. Wheelan doesn’t care about the math and the charts—he just wants you to understand the magic. Naked Economics is the book for the rest of us, helping the non-economist to rationally analyze everything from McDonalds to congestion to political systems.

Wheelan is a master storyteller and master economist (a rare combination), which is why media groups ranging from NPR to The Economist hire him to explain complex issues to the masses. True, former economics students might shudder to read long-forgotten terms like luxury goods, market equilibrium, and productivity growth, but, unlike your professor, Wheelan won’t give you an exam on these concepts. He uses them to explain real problems that countries, firms, and individuals face every day.

Take insurance – from the Obamacare debates of 2009 to the “Medicare for All” platforms of 2020, we have all heard explanations about why healthcare costs are high and how people struggle to pay for them. Most of the explanations are confusing, but Wheelan brings in the economic concepts of information, incentives, and inelastic demand to simplify the problem. After eight pages of marvelously readable commentary, he sums it up in the following: “(1) We know who is sick; (2) increasingly we know who will become sick; (3) sick people can be extremely expensive; and (4) private insurance doesn’t work well under these circumstances.”

Your typical economics book is probably jam-packed with technical language, graphs, and theory, but Wheelan takes the road less traveled. Each page in Naked Economics has a story. Every concept is layered with realistic application. The book reads like an edition of The New York Times—real problems, real stories, and expert explanations of what is going on. In fact, the book’s chapters are a lot like Legos: a story explains a concept which builds upon a current affairs issue, which builds upon another concept. By the end of the chapter, you understand key economic principles like financial markets or international trade. More importantly, you know how those principles explain the complexities of life.

Have you ever wondered how China could devalue the U.S. dollar overnight? Or why the government pays a ridiculous amount of money for new technology? Or even what the Federal Reserve does and why that matters? Naked Economics gives you clear explanations of these complexities and more. The book shows you how today’s global economy operates, from corporate board rooms to family living rooms. And it does so with a dazzling array of experts. With quotes from Nobel prize winners, Washington think tanks, and world leaders, Naked Economics is not just the opinion of one economist: it pulls from the best and brightest in the economics community.

Does Wheelan take stances? Rarely. But that’s not the point. As he states in his conclusion on insurance: “The tough part is philosophical/ideological.” Economics teaches you how to understand the solutions. Philosophy tells you what solution to pick. If you’re looking for someone to tell you what to believe, don’t read this book. If you’re looking for ways to sort through the world’s complex problems, then put Naked Economics on your GoodReads “To Read” shelf.

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