Reinventing the Bazaar: A Natural History of Markets

by John McMillan

Overview

Clear, insightful, and nondogmatic, this book gives us a new appreciation for one of our most ubiquitous institutions.

From the wild swings of the stock market to the online auctions of eBay to the unexpected twists of the world's post-Communist economies, markets have suddenly become quite visible. We now have occasion to ask, "What makes these institutions work? How important are they? How can we improve them?"

Taking us on a lively tour of a world we once took for granted, John McMillan offers examples ranging from a camel trading fair in India to the $20 million per day Aalsmeer flower market in the Netherlands to the global trade in AIDS drugs. Eschewing ideology, he shows us that markets are neither magical nor immoral. Rather, they are powerful if imperfect tools, the best we've found for improving our living standards.

A New York Times Notable Book.

Product Details

ISBN-13:	9780393075724
Publisher:	Norton, W. W. & Company, Inc.
Publication date:	11/17/2003
Sold by:	Barnes & Noble
Format:	eBook
Pages:	288
File size:	713 KB

About the Author

John McMillan (1951—2007) was the Jonathan B. Lovelace Professor of Economics at Stanford University's Graduate School of Business.

Table of Contents

	Preface	ix
1.	The Only Natural Economy	3
2.	Triumphs of Intelligence	15
3.	He Who Can't Pay Dies	27
4.	Information Wants to Be Free	41
5.	Honesty Is the Best Policy	53
6.	To the Best Bidder	65
7.	Come Bid!	75
8.	When You Work for Yourself	89
9.	The Embarrassment of a Patent	103
10.	No Man Is an Island	119
11.	A Conspiracy against the Public	136
12.	Grassroots Effort	148
13.	Managers of Other People's Money	167
14.	A New Era of Competition	182
15.	Coming Up for Air	196
16.	Antipoverty Warriors	211
17.	Market Imperatives	224
	Acknowledgments	231
	Endnotes	233
	References	247
	Index	263

Editorial Reviews

You may have heard that economics is the dismal science. Not in McMillan's hands. Here economics is fun, fascinating, ... fruitful.

Peter L. Bernstein

There could be no better guide to the modern view of markets than McMillan's new book.

Joseph E. Stiglitz

Lively [and] instructive... A colorful and authoritative look at how markets work and don't work in today's economy.

Hal R. Varian

Required reading for anyone who wants to understand the "magic" of markets... Lucidly explained, brilliantly analyzed, and delightfully explored.

Reed E. Hundt

McMillan's rich knowledge of ... current economic theory and ... economies in transition is well embodied in this ... sophisticated survey.

Kenneth J. Arrow

A wide-ranging, illuminating history of that old, colorful, and sometimes disgraceful institution known as the marketplace: exotic, innovative, and everyday; on terra firma and in cyberspace; bazaar to eBay. "Reinventing" is a vital notion here, for the best markets, says McMillan (Economics/ Stanford Univ. Graduate School of Business), are those that develop from the bottom up over time through trial and error, always restless and reshaping themselves with creativity and flexibility. Shortcutting the process rarely works. Then again, markets would never attain their fullest potential without a soupçon of government intervention when age-old procedures need to be formalized and authority given to enforce the results, or as a means of "providing goods and services that markets would undersupply and acting in the background as market rule-setters and referees." McMillan lays out the prerequisites for a successful market: "information flows smoothly; property rights are protected; people can be trusted to live up to their promises; side effects on third parties are curtailed; and competition is fostered." He is well aware of the absurdities and cruelties such a system may spawn (patent law is a good example), though he endeavors to understand poverty and inequality as structural rather than inherent in the marketplace. McMillan has his heart in the right place and isn't about to sniff at suffering. Unlike free-market zealots, he appreciates that markets are imperfect and can even be disastrous. They are also, he reminds us, a natural economy, "too important to be left to ideologues," and they are "not just about money. A well-designed competitive market puts resources into the hands of thosewho can best use them." Design is the issue here, a delicate balance between the organic evolution of the market and state oversight. Felicitous economics? Hard to believe, but McMillan's prose resembles single malt, going down easy as it stimulates. Clarifying and humanistic.

Kirkus Reviews