This is a Great Book: No One Makes You Shop at Walmart

01Aug07

I just finished reading a great book, No One Makes You Shop at Walmart by Tom Slee, and it ought to be assigned reading in every high school and college introductory economics class in the country. Like any good, cost-conscious citizen of the commons, I got this book from my local library but I just put my order in at Amazon for a personal copy because, friends, this book is a keeper.

The economic heart of the book is built around game theory, but the actual subject of the book is a widespread economic myth, which Slee refers to as MarketThink, and I usually call the myth of individual choice. Under either name, this is the idea that general prosperity and happiness always increase when we let private enterprise increase the range of choices that individuals have in the marketplace. In this view, more choices in the marketplace equals more people getting the sort of goods they want most, which equals more good times for everyone. As a corollary, any time the government creates laws and regulations that reduce the individual’s range of choices in the marketplace, our prosperity and happiness are reduced.

Slee manages to demolish the myth of individual choice past all recovery. He accomplishes this demolition by inviting us into the fictional town of Whimsley, and then simply applying modern economic models and theories, mostly drawn from game theory, to the everyday choices being made by its inhabitants. What we find is that unrestrained individual choice in the marketplace has the potential to cost Whimsley and its inhabitants dearly.

None of the models and ideas that Slee presents are original, and anyone who has done any serious reading in economics has encountered them and is probably also aware that these ideas have been used for critiques of the market. But the great strength of Slee’s book is that he gathers them all together and specifically draws out their implications for the myth of individual choice. Considered separately, these critiques of the market are interesting and suggestive. But pulled together and focused on a single theme, their combined persuasive power is devastating. If enough people read this book, the propagandists of the right wing will need to come up with a new myth.

In one important respect, Slee’s political concerns actually make this book a particularly good introduction to game theory. Game theory is often presented as a theory of competitors who are trying to beat each other. Introductions to game theory are full of examples of nations competing for power, or corporations fighting each other for market share. In trying to show how markets can impact communities, Slee’s book highlights a deeper level of game theory that is simply about interdependence between people. In Slee’s presentation of his core argument, the customers who switch their shopping from downtown department stores to a new Walmart are not competing against other. They are not trying to best each other in any way and consider their choices about where to shop to be purely personal matters. But just as with any classic, competitive case of the prisoner’s dilemma, game theory shows how these innocent and rational individual choices, taken together, can create problems that no one intended and no one profits by. Slee thereby makes his political point, but also gives us a different perspective on the uses of game theory than we usually get in popular economics.

As I read, I kept thinking about another one of my favorite books: Why Big Fierce Animals Are Rare, by Paul A. Colinvaux. Colinvaux’s book is about ecology, but resembles Slee’s book in that both do an excellent job of bringing a collection of abstract, academic theories to life. Both authors have a gift for minimalism, revealing the power of the theories by pruning them back to their barest, most essential forms and then staying relentlessly focused on them. It’s just plain good writing

From a political perspective, I think Slee has chosen his target well. Over the last thirty years or so, free market ideologists have relentlessly hammered on the idea that good economic policy primarily consists of increasing individual choice in the marketplace. You can find this idea being put forward in just about any newspaper or pundit gabfest in the country. I encountered it just last week in Alabama, in a newspaper which ran two opinion pieces, one arguing for and one against higher fuel efficiency requirements for automobiles. The piece arguing against fuel efficiency requirements was written by the National Center for Policy Analysis, and it was as depressing a piece of libertarian propaganda as you’re ever going to see. And the first argument, presented in the first paragraph, is that fuel efficiency regulations can’t possibly be any good because regulations reduce the scope of individual choice in the marketplace, and we all know that reducing individual choice in the marketplace just has to be bad.

I have a couple of qualifications. In my opinion, Slee overstates his anti-market conclusions on two or three occasions, but (for me at least) that is a small thing. The strength of this book is its arguments, and so long as people are reading to understand the arguments, rather than jumping to the end of a chapter to find out what to believe, there won’t be any damage done. To his credit, Slee does point out that his arguments describe only one aspect of markets, and that markets have strengths as well as weaknesses. Absolutely right.

On a related note, Alex Tabarrok of Marginal Revolution stated that the book would be stronger if Slee had addressed some common libertarian counter-arguments to his models, and I understand what he means. Certainly some pro-market counter-arguments were crossing my mind at certain points in the book. But, as I mentioned, part of the lucidity and effectiveness of the book comes from its laser-like focus on its core arguments and their core implications, and I think Slee made the right choice as a writer to avoid extended discussions that would have broken that focus. To address the libertarian counter-arguments he may need to write a follow-up book and call it No, Really, a New Walmart Could Actually be Bad for Your Town.

So this is a thumbs up. If you like economics, I think you should read this book. I think a lot of people should read this book.

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