Applied Economics: Politics, Markets, and Social Issues

This text excerpts from Thomas Sowell’s Applied Economics explores the discrepancies between economic principles and their political application. Sowell emphasizes the importance of “thinking beyond stage one,” considering long-term consequences often ignored by politicians focused on immediate electoral gains. The book uses various examples, including housing markets, medical care, and crime, to illustrate how policies driven by political considerations rather than economic principles lead to unintended and harmful outcomes. It also examines the economics of discrimination and the economic development of nations, arguing that factors beyond simple prejudice or resource extraction significantly impact a country’s prosperity. Finally, the text references numerous sources to support Sowell’s arguments and analysis.