The Nature of Economies

by Jane Jacobs

Book Overview

From the revered author of the classic The Death and Life of Great American Cities comes a new book that will revolutionize the way we think about the economy. Starting from the premise that human beings "exist wholly within nature as part of natural order in every respect," Jane Jacobs has focused her singular eye on the natural world in order to discover the fundamental models for a vibrant economy. The lessons she discloses come from fields as...

• Format: Paperback
• Language: English
• ISBN: 0375702431
• ISBN13: 9780375702433
• Release Date: March 2001
• Publisher: Knopf Doubleday Publishing Group
• Length: 208 Pages
• Weight: 0.55 lbs.
• Dimensions: 0.8" x 5.1" x 8.0"

Customer Reviews

The content is major even if the form is debatable

A number of the other reviews critiscise the conversational form of this book. And one reviewer (who is clearly an investment analyst) critiscises one tiny sentence which makes a rather erroneous analogy between corporate and national behaviour. But the central theme of the book, that economies must be defined by natural principles since they are the product of human beings, themselves merely a succesful product of nature, is crucial. Its enlightening and must be debated and fleshed out. It gets beyond the "hack" economics that suggests economies need to make exports in order to earn their keep. Instead, Jacobs says that exports are the output of economic systems, not the inputs. The real inputs are basic resources - e.g. weather, location, human skills & the depth and breadth of the existing economic system.As an amateur economist I find the argument to be a strong one. Serious critiscisms of this book should be based on critiscisms of the central argument and its substantiveness, rather than of the formn of the book. I'd enjoy seeing such critiscism from professional economists.

An enlightening dialogue

Jane Jacobs' compelling little book deals with fundamental issues concerning how economies work. It is written as a Socratic dialogue among a group of friends. This format allows for a very engaging and insightful treatment of some fairly complex topics, but at the same time it makes it difficult to place the dialogue in the rich academic literature on these topics. Jacobs focuses her effort in this dialogue on the basic functioning of economic systems, and the fundamental observation that they must obey the same laws of physics, chemistry, and evolutionary biology, as any other complex adaptive system. Jacobs is most famous for her work demolishing the doctrinaire views of city planners and forcing them to look at the way real cities really work (Jacobs, J. 1961. The death and life of great American cities. Random House). In this book she does the same thing to economists, forcing the confrontation of unquestioned theory with reality. She also emphasizes some important philosophical positions that distinguish conventional from a more "ecological" economics. The most basic of these is the idea that humans and their artifacts are just as much a part of nature as any other organism. The Cartesian dualism that underlies conventional economics (and much of conventional science) assumes that humans are somehow fundamentally different from the rest of nature. This sets up a basic (and false) environment vs. economy dichotomy and leads to a host of other conceptual difficulties. The truth is that humans and their artifacts behave much like all other complex adaptive systems. The book is a treatise on how complex adaptive economic systems work (especially urban systems) and the kind of science and policy that flow from this understanding.

Engaging Thoughtful Discourse on Economics and Ecology

Jane Jacobs is one of the greatest urban economists of our era and in this book she brings together ecology and economy to demonstrate how human prosperity and processes of nature are one and the same. Humans prosper to the degree that they follow, consciously or not, these natural processes. In this sense, the modern city is a "natural" environment according to Jacobs. This view is likely to be controversial among many contemporary ecologists, especially those who feel that human prosperity is a scourge and not a blessing. However, it is difficult to read this book and not feel that Jacobs is indeed both a humanist and an ecologist.Jacobs challenges economists as well as ecologists. Modern economics is derived from the mechanics of 18th and 19th century physics and as such is largely divorced both from humanity as well as from nature. Jacobs argues here for an economics based on an understanding of nature. According to Jacobs, this natural-based economics implies that economic diversity and not specialization is an important key to prosperity.Jacobs expounds her ideas in a series of philisophical discussions among contemporary urban dwellers, a devise that works splendedly because her prose is excellent. This little book is highly recommended for those interested in a fresh perspective both on economics and on the place of humans in the natural environment.

It's really very simple . . .

It is no accident that Toronto is often rated as one of the most livable cities in North America -- Jane Jacobs lives there, and she takes an active role in helping shape her adopted city. She also does something original; she actively examines the topics she writes about, instead of relying upon the mere observations of others. When you use a chunk of granite, a bar of steel or the speed of light, it's worth knowing that inanimate objects don't change much. But, Jacobs and all other social scientists deal with people; and people are continually changing. One of her central themes is that since Adam Smith in 1776, economists have tended to ignore the real world. "Smith himself was partly responsible for that blind spot," Jacobs writes. "He led himself and others astray by declaring that economic specialization of regions and nations was more efficient than economic diversification. "The theorists after Smith retreated into their own heads instead of engaging ever more deeply with the real world," Jacobs writes. "Plenty of observable, germane facts were lying around in plain sight, ready and waiting to lead Smith's insights, straight as directional arrows, into the subjects of development and bifurcations." Adam Smith overturned centuries of thinking when he wrote, "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard for their own interest." Until then, there was a general feeling that God, or Nature, or other supernatural force provided our sustenance; Smith said personal interest is the key to economic life. Smith takes that idea the next step: Yes, natural products exist, but we can wipe them out by overuse. Every system in nature is harmed by over-indulgence; nothing can be exploited without some collateral cost. Excess carries the seeds of its own destruction; humans are a part of nature, and thus subject to similar limitations. Thus, the book's title -- "The Nature of Economies." Every society is a part of nature; people are always subject to the inevitable laws of nature. This isn't tree-hugging ecology or a `Save a Whale for Jesus' fad; it's the fundamental rules by which nature, and thus our communities, live on a day-to-day basis. Consider a real example: Phoenix literally "paves the desert." Twenty years ago, climatologists knew this raised night temperatures, because asphalt soaks up heat during the day and radiates at night. Night temperatures have risen by almost 10 degrees -- which adds immensely to air conditioning bills, and greatly reduces livability. Yet, city officials steadfastly ignore this feedback to pursue a policy of unlimited growth. Is this unusual? Think of Los Angeles traffic, Las Vegas, Albuquerque, El Paso, and Tucson -- each with its own growing problems. Jacobs argues the "nature of economies" means being aware of feedback, and facing issues before they become a crisis. Desp

a book unlike any other

This is a truly unique book--a serious book on a critical topic written with much insight, originality, and an unbelievable amount of imagination. I've heard much talk of the author before--especially her seminal book "The Death and Life of Great American Cities"--but "Nature of Economies" is the first book by Jacobs I've ever read. I'm glad to report that all the positive things I've heard about the author is true: she is as sharp and thoughtful a thinker as they come. What's even more endearing (for me anyway) is that she eschews the jargons and pompous prose of academy and writes with simplicity and grace so that anyone and everyone can understand her points. (I can't remember the last time that I've read a book on economics or sociology and not been put off by the awful language.)Another special thing about this book, as most of you've probably heard by now, is that Jacobs has cast her thoughts in the dialogue form: conversations between 5 intimate friends. I must say it's quite strange to come upon a serious treatise on economics and nature, written and published in the first year of the 21st century, that uses what seems (to me) an 18th- or 19th-century format (I'm thinking in particular of those philosophical dialogues on religion, morality, etc., written by the likes of David Hume and Giacomo Leopardi, not to mention all those "philosophes" of the Enlightenment), which was in turn an imatation of the Platonic dialogues. Well, why not? After all, Jacobs has the brilliance of mind and sharpness of wit to get away with it. (Though it does mean getting some used to for an average reader like me.)As for what the book is trying to say, I'm still trying to figure it out. It's such a tiny little book but yet I'm not embarrassed to say that I've not fully grasped all her points. But I do know that this book has all the trappings of a classic (in the best sense of the word) and it'll be read and reread, debated over and written about, again and again, in the years to come. So is Jacobs the new Hume or Leopardi? Maybe. The last "philosophe" of our modern era? Definitely.