(p. A21) Jean Tirole, who won the Nobel Prize in economics in 2014, says that the study of economics is “simultaneously demanding and accessible.”
. . .
“Economics for the Common Good” offers an ambitious yet accessible summary of his ideas on the proper role of economists and the value of their ideas in informing government, business and social life.
. . .
One of the best chapters in the book deals with the issue of employment law in France. Successive governments have tried to micromanage the agreements between companies and employees to ensure fair treatment and low unemployment. But France’s unemployment rate has remained high, entrepreneurship has been stifled, and companies have become loath to hire people because of the prohibitive costs of firing them. Even if an employee proves useless, it’s nearly impossible to sack him.
On the employee’s side, even if you want to resign, it is more lucrative to wait to be fired, since you get both severance pay and unemployment insurance. To resolve the stand-off between workers who want to quit and companies that want to cut staff, employers and employees now collude through a legal formula called “termination by mutual consent.” The employee resigns and receives unemployment benefits as if he has been dismissed, and the company is spared the legal ramifications and costs of dismissal. In Mr. Tirole’s view, such bureaucratic madness is choking growth.
. . .
Mr. Tirole has a patient, explanatory style. But when riled, he lashes out. The French education system, he writes, purports to be non-selective but favors the affluent and well-educated. It “is a vast insider-trading crime.”
For the full review, see:
(Note: ellipses added.)
(Note: the online version of the review has the date Dec. 18, 2017, and has the title “BOOKSHELF; Review: What Good Is an Economist?; A French Nobel laureate and public intellectual discusses the proper role of the dismal science in government, business and the life of the mind.”)
The book under review is:
Epstein, David. Range: Why Generalists Triumph in a Specialized World. New York: Riverhead Books, 2019.