Licence to be Bad Book Summary - Licence to be Bad Book explained in key points
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Licence to be Bad summary

Jonathan Aldred

How Economics Corrupted Us

3.9 (120 ratings)
27 mins

Brief summary

Licence to be Bad by Jonathan Aldred is a thought-provoking book that explores why we tolerate bad behavior from corporations and individuals. It challenges the assumption that selfishness is a necessary driver of economic growth and offers alternative ways of thinking about our social and economic systems.

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    Licence to be Bad
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    A set of controversial, free-market economic views have come to dominate our way of thinking.

    Let’s travel back to 1947. 

    It’s two years after the end of World War II, and economies across Europe are in ruin. In an international effort to stimulate growth, a policy of increased public spending is underway. Leading this movement is esteemed economist John Maynard Keynes. Keynes is convinced that public spending initiatives are the only way to get the economies of Europe back on track.

    But a small, renegade group of economists, led by Friedrich Hayek, disagree. Hayek organizes a conference of this group on Mont Pèlerin, high in the Swiss Alps. While Hayek’s followers were in the minority back in 1947, it wouldn’t be too long before they rose to ascendancy.

    The key message here is: A set of controversial, free-market economic views have come to dominate our way of thinking.

    Some of those at Mont Pèlerin would go on to form the Chicago School of economics. At the heart of the Chicago School is the idea that governments and regulators should stay out of the economy as much as possible. The free market should decide where money is made and spent, not public officials. 

    The school provided the theoretical backbone to Reaganomics and Thatcherism, which introduced radical free-market ideology to the US and UK respectively in the 1980s. Along with some other ideologically similar ideas, it’s been dominant ever since, and many see it as the only correct way of thinking about economics. But are they right? 

    Well, let’s look at a couple of examples to see how such economic thinking works in the real world.

    In 2007, the global economy came crashing down. Markets and banks nosedived, and countless people lost their jobs and livelihoods. But whose fault was it? A lot of people have blamed the financial regulators – pointing toward governments and lawmakers, rather than the banks themselves.

    If you think about it, that’s like blaming the police for a burglary, which doesn’t really make sense. So why should it make sense when it comes to finance? Well, this is exactly the kind of thinking the Chicago school encourages.

    Economic theory is also behind how we think about climate change. It’s common these days to adopt free-rider thinking – the belief that because our own contribution to change is so minimal, it’s not worth doing at all. This pessimistic worldview was granted economic legitimacy by American economist Mancur Olson in the 1960s. And it’s already helping to destroy our planet.

    Free-rider thinking and Chicago School thinking are far from the objective truth. But many people think about the economy and society in this way. In the following blinks, you’ll find out why a lot of this thinking just doesn’t add up.

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    What is Licence to be Bad about?

    Licence to be Bad (2019) explains how in the past 50 years a small handful of economists has drastically changed the way we think about the subject. Ideas including game theory, public choice theory, and free-riding have worked their way into our minds and our discourse, apparently permitting us to behave badly.

    Licence to be Bad Review

    Licence to be Bad (2020) by Jonathan Aldred is an eye-opening exploration of the economic theories and ideas that shape our society. Here's why you should give it a read:

    • With compelling arguments and thorough research, the book challenges conventional economic wisdom, encouraging readers to critically examine our current economic system.
    • Aldred presents a fascinating analysis of the relationship between economics and morality, raising thought-provoking questions about the impact of individual and collective behavior on society.
    • The book's engaging examples and accessible language make complex economic concepts accessible, keeping the reader captivated and ensuring the subject matter never feels dull.

    Who should read Licence to be Bad?

    • Economists interested in rethinking the subject
    • Ethics enthusiasts with an interest in recent thought
    • Anyone wondering why we think the things we do

    About the Author

    Jonathan Aldred is a fellow at Emmanuel College, University of Cambridge, where he teaches economics and land economy. His first book, The Skeptical Economist, was published in 2009 and examines the ethics that lie behind economics.

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    Licence to be Bad FAQs 

    What is the main message of Licence to be Bad?

    To understand why we make bad decisions and how society can be structured to encourage good behavior.

    How long does it take to read Licence to be Bad?

    The reading time for Licence to be Bad varies depending on the reader's speed. However, the Blinkist summary can be read in just 15 minutes.

    Is Licence to be Bad a good book? Is it worth reading?

    Licence to be Bad is worth reading because it explores the psychology behind our choices and offers insights for a better society.

    Who is the author of Licence to be Bad?

    Jonathan Aldred is the author of Licence to be Bad.

    What to read after Licence to be Bad?

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