Finding Economics in Small Things

The Economics of Small Things is a book of many-splendoured things! The book is unabashedly Indian at heart as it swings from references to Krishna playing the flute for pining ­Gopis, to Shah Rukh Khan movie tickets, to Joota Chori, and even visiting the Taj Mahal. While it has its trysts with the Pied Piper of Hamelin, Louisiana, and Belgium, the narration ­always comes back to rest on Ludhiana and Belgaum through it all. Along the way it picks up bits of savory pav bhaji (an Indian street food) and some delicious “jalebis” while introducing the jingle “Ek Chidiya, Anek Chidiya” as examples to motivate concepts as diverse as price and statistical discriminations to as deep as common knowledge.

The book contains a series of thoughts and observations on life explained through the eyes of an economic theorist. Parts of it remind the reader of two other projects—Of People, Of Places: Sketches from an Economist’s Notebook (Basu 1995) and An Economist’s Miscellany (Basu 2011). While the book purposely stays away from technical economic jargons, the topics are by no means simple. It deals with some of the relatively finer and important things in microeconomic theory that are not obvious to the uninitiated reader. Concepts like signalling, adverse selection, along with more recent advances in economic theory in other-regarding regarding behaviour such as envy are introduced and explained in a very simple and engaging manner.