Over the years, I’ve received requests from those eager to dive deeper into the world of economics. While there are plenty of resources available for those who want to study the subject, I understand that many of you are looking for something more personal, something that reflects my unique perspective on these fundamental concepts.
Well, here it is.
I’m currently working on a new book that distills the entire field of economics into just one core concept: cost.
Cost is the very foundation of every economic decision. If an action carries no cost, there’s no decision to be made. Economics begins and revolves around the notion of cost, but it’s often misunderstood or oversimplified. My goal is to break down this concept in a way that’s both practical and insightful, giving you a fresh understanding of the decisions we all make.
Part 1: The Fundamentals of Economic Decision-Making
The first part of the book will focus on the basics, i.e. opportunity cost. I’ll also delve into how cognitive biases cloud our decision-making, e.g. sunk cost fallacy and reflect on the nature of rationality. What does it mean to be rational, and is it always necessary? I’ll explore the link between modernity and rationality, questioning the assumptions that guide our everyday choices.
Part 2: Competition—Bigger Isn’t Always Better
Next, I’ll turn the spotlight on market competition and the myth that scaling up is always the key to success. Many believe that success in business is all about driving down the average costs through scaling, but in reality, bigger isn’t always better. I’ll explore how the pursuit of economies of scale can lead to fierce competition, where profits are eroded, and only the consumers win. I’ll also discuss strategies businesses use to deter competition—and why monopolies succeed only when government plays a part.
Part 3: Public Policy—The Illusion of Cost-Benefit Analysis
In the third section, we’ll move into public policy and the messy reality behind cost-benefit analysis. While textbooks talk about market failures and public goods, the truth is that real-world decisions often suffer from mismatches—those who bear the costs aren’t always the ones who benefit. I’ll introduce public choice theory, showing why governments are no better equipped to solve what the market can’t. We’ll also tackle misunderstood concepts like public goods, externalities, and network effects, diving into how these issues shape infrastructure and the digital economy.
Part 4: Time and Uncertainty
In the final section, I’ll explore the relationship between time, risk, and uncertainty. We’ll discuss the concept of time and the time value of money, where interest is not just the decision made by the Federal Reserve, but the market clearing price for money in the future. I’ll also challenge the conventional distinctions between money and debt. Ultimately, this section will offer readers a fresh perspective on what uncertainty is an what we can do about it.
One More Reason Why I’m Writing this Book
This book isn’t just an intellectual exercise, it’s also an experiment in using technology.
While all the ideas, writing, and structure of the book are mine, Generative AI will play a crucial role throughout the process. From research and fact-checking to editing, translation and even marketing, AI will assist me at every stage.
This unique collaboration will also become the subject of another project, a book that documents my experience of using AI to enhance creativity and productivity. I want to challenge myself and explore how this partnership with AI can push the boundaries of what’s possible for solo creators like me.
Stay tuned for more updates as I move forward with this exciting project. Meanwhile, please enjoy the review of the project I generated with Google’s Notebook LM.
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