Under Cover Ecnomics

THE UNDERCOVER ECONOMIST

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THE UNDERCOVER ECONOMIST
Exposing Why The Rich Are Rich, The Poor Are Poor— And Why You Can Never Buy A Decent Used Car!

Tim Harford

2006

Oxford University Press, Inc., publishes works that further Oxford University’s objective of excellence in research, scholarship, and education. Oxford New York Auckland Cape Town Dar es Salaam Hong Kong Karachi Kuala Lumpur Madrid Melbourne Mexico City Nairobi New Delhi Shanghai Taipei Toronto With offices in Argentina Austria Brazil Chile Czech Republic France Greece Guatemala Hungary Italy Japan Poland Portugal Singapore South Korea Switzerland Thailand Turkey Ukraine Vietnam Copyright © 2006 by Tim Harford Published by Oxford University Press, Inc. 198 Madison Avenue, New York, New York, 10016 www.oup.com Oxford is a registered trademark of Oxford University Press All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior permission of Oxford University Press. Library of Congress Cataloging-in-Publication Data Harford, Tim, 1973– The undercover economist / Tim Harford. p. cm. ISBN-13: 978-0-19-518977-3 ISBN-10: 0-19-518977-9 1. Economic history, 1990– 2. Economics. 3. Consumer education. I. Title. HC59.15.H35 2005 330.9'0511—dc22 2005010297

1 3 5 7 9 8 6 4 2 Printed in the United States of America on acid-free paper

To Deborah Harford, Fran Monks, and Stella Harford—family . . . past, present, and future.

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Acknowledgments

Peter Sinclair got me into economics; Tony Courakis, Simon Cowan, Stan Fischer, Bob Garhart, Paul Klemperer, Brendan McElroy, Elinor Ostrom, Hyun Shin, Bill Sjostrom, and many others helped me along the way. I am grateful to them all. At Shell, Ged Davis let me work part-time while I produced the first draft of the... [continues]

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