Hidden Order Book Review

Topics: Microeconomics, Economics, Macroeconomics Pages: 3 (1072 words) Published: September 17, 2011
The summary of the rationality theory and price theory & the conclusion of the book. Careful study of Friedman's new book, Hidden Order: The Economics of Everyday Life, will make the reader a better thinker and a more skilled debater, whether the topic is economics, politics, crime, or love and happiness. Economics is not just the study of satisfying insatiable wants with limited resources, as so many textbooks illustrate. Economic science encompasses all human behaviour: people acting rationally to reach objectives. Those objectives include such everyday dilemmas as deciding which checkout lane at the supermarket will be fastest, dating and finding the right person to marry, voting, and protecting one's property. Friedman has very skilfully spoken about how people select the checkout lanes in the supermarkets. Many of us would try to find out the shortest line to join so that we take the least time to check out. However, everyone thinks the same and thus the advantage of joining the shortest line disappears. All the lines are of the same length. Thus the rational thinking should be to join a line in which people have fewer things to check out so that they are able to move faster and thus the line will also move faster. The author explains the same phenomena by citing the example of change of road lanes. People shift to a lane thinking that it’s a faster lane. However, everybody thinks the same and everyone is as smart as the other. So everyone who is in a hurry will be changing to the faster lane and hence the advantage of the faster lane will disappear and all the lanes will become the same. Further, Friedman says that all of us are rational and we tend to weigh our cost and benefits before taking any decision. He says that voting for the right candidate would involve lot of cost in terms of gathering and studying the information although the a single persons’ vote will be just one of a millionth and will not be counted so much during taking a decision. So we...
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