The Undercover Economist Strikes Back (Book review)

I'm a great far of Tim Hartford and his skill for making economics real and relevant to the man-in-the-street. I also thought Adapt, his previous book, was a 'must read'.

So I purchased this book as soon as it was published and looked forward to an excellent read. Unlike his other books this one is concerned with macroeconomics, something which I think virtually every foundation business studies course must cover in some way. Perhaps the book is targeted at that readership, and if that is the case, it is an excellent introductory text. It would also be ideal for anyone trying to get behind the jargon of current news stories.

However, the book just didn't work for me. It is comprehensive and Hartford, as usual, manages to demystify some big issues. But I found the style of writing irritating - it takes the form of an imaginary character conversing with Hartford and posing questions which he answers. That may appeal to some but I hope Hartford drops that approach.

'Adapt' was an excellent book and I could visualise myself reading it again. That's not an accolade I think 'The Undercover Economist Strikes Back' shares. Nevertheless, given Hartford's previous excellent track record as an author, I still expect to buy his next book.

PS I noticed that it's available as an airport edition at a significantly reduced price - so if you're travelling soon you could pick up lower price version on your travels.

Scepticism is a procurement virtue

We all hold up Harvard, home of the HBR, as having a reliable voice worth listening to. That's where Michael Porter's 5 Forces, value chain and so much of procurement's basic academic theory derives from.  Yet we have now discovered that two of its esteemed professors, who influenced UK austerity strategy, got it wrong in their research. Fortunatelty one of student, Thomas Herndon, a PhD candidate (pictured), had the sense to question their data.

There is a not insignificant problem though in that the Chancellor may relied on Reinhart and Rogoff's flawed evidence which told him what he wanted to hear about austerity strategy, even though it has now been proved wrong.  But Osborne is not alone in being gullible.

We have also learnt that a key influencer in childcare policy was feted yet without much testing of his credentials.

Then we have the health nightmare unfolding in Wales as a result of the nonsense propagated by the now discredited Dr Andrew Wakefield over the dangers of MMR vaccinations. Many of the population, including the Lancet proved gullible.

That's not to mention the £50m spent on fake bomb detectors.

Is there not something which suggests that when you get someone who is coming up with a 'flat earth theory' you maybe should test a bit more, after all is that not what the scientific method is all about. The   student who have the bravery and tenacity to challenge the findings of the two Harvard professors was not welcomed with open arms but has been proved right.

As procurement professionals perhaps we also need to be bravery, more tenacious and sceptical.

Two examples of what I mean in terms of procurement: I recently critiqued a bid and found 25 assumptions stated by the bidder - when the buying organisation were challenged on the assumptions I found that raised a hare in terms of readiness to accept the bid without being contractually open to additional costs and risks. Secondly, some 20 years ago, I was asked to review a recommendation for a tender award a few hours before it was to be recommended to councillors for acceptance. I received many cynical looks when I strayed beyond my 'look at the process' remit and revealed that the 'numbers just didn't add up'. Of course the "specialist consultants couldn't be wrong" - well actually, sorry, they were wrong.

We should use the low risk option of questioning validity in procurement more often - all we need is to be more sceptical and recognise that scepticism can really add value.

So, why is it so difficult to be a sceptic? Isn't scepticism a procurement virtue?  

End This Depression Now! (Book review)

I suspect some of my regular readers may wonder what sort of person takes a book on holiday with this title and then recommends it.

This book, by Paul Krugman, is not about a psychological condition but about the current economic condition – Paul Krugman being a heavyweight economist who is able to clearly explain the current euro crisis and the financial woes facing most western economies.

Krugman’s core argument is that there is plenty of evidence that current economic policies are hostage to a political philosophy as opposed to being shaped economic ‘know how’.  Current economic policies are not working, even though a shift could bring a speedy end to the misery being experienced by so many. The shift advocated is a U-turn on austerity and speedy public spending.

It may be difficult for politicians to make yet another U-turn but I think it is a debate worth having and, if that switch takes place, it could have a big impact on procurement policy.  Of course public spending options go beyond procurement and could be through increased spending on benefits, etc.