Economyths: Ten Ways Economics Gets It Wrong

To be published by Icon Books in the UK and John Wiley and Sons (North America) in spring 2010.

From the inability of wealth to make us happier, to our catastrophic blindness to the credit crunch, "Economyths" reveals ten ways in which economics has failed us all. Forecasters predicted a prosperous year in 2008 for financial markets - in one influential survey the average prediction was for an eleven percent gain. But by the end of the year, the Standard and Poor's 500 index - a key economic barometer - was down 38 percent, and major economies were plunging into recession. Even the Queen asked - Why did no one see it coming? An even bigger casualty was the credibility of economics, which for decades has claimed that the economy is a rational, stable, efficient machine, governed by well-understood laws. Mathematician David Orrell traces the history of this idea from its roots in ancient Greece to the financial centres of London and New York, shows how it is mistaken, and proposes new alternatives. "Economyths" explains how the economy is the result of complex and unpredictable processes; how risk models go astray; why the economy is not rational or fair; why no woman (until 2009) had ever won the Nobel Prize for economics; why financial crashes are less Black Swans than part of the landscape; and, finally, how new ideas in mathematics, psychology, and environmentalism are helping to reinvent economics.

The Other Side of the Coin: The Emerging Vision of Economics and Our Place in the World

Economics is in the middle of a revolution. Neoclassical economics – the type most taught and practiced today – was based on the science of the nineteenth century, and is beginning to show its age. A new economic theory, or theories, are now being fashioned, inspired by sciences such as complexity, fractals, and network theory. Most of these ideas first developed in the 1960s, but are only now filtering through to the world of money and finance. The Other Side of the Coin finds new and surprising connections between these disparate fields, and shows that each forms a separate strand in a larger pattern, which is slowly inverting our ideas about money, value, and the purpose of society. A mix of history, science, mythology, and personal anecdote, it will change the way you see the economy and our place in the world.

Apollo’s Arrow: The Science of Prediction and the Future of Everything (HarperCollins, 2007)

For centuries, scientists and charlatans have claimed to know what’s happening tomorrow before tomorrow comes. But how well can we really predict the future? Can past events—Hurricane Katrina, bull markets, the SARS outbreak—help us understand what will happen next? Will scientists ever be able to forecast catastrophes, or will we always be at the mercy of Mother Nature, waiting for the next storm, epidemic or economic crash to thunder through our lives?

In Apollo’s Arrow, Canadian scientist David Orrell looks back at past prognosticators, from the time of the Oracle at Delphi to the rise of astrology to the advent of the nightly news, showing us how scientists (and some charlatans) predicted the future. He asks how today’s scientists can claim to anticipate future weather events when even three-day forecasts prove a serious challenge. Can we predict epidemics? Can we accurately foresee our financial future? Or will we only find out about tomorrow when tomorrow arrives?

The trajectory of an arrow is something that can be determined reasonably accurately from the arrow’s starting position and its velocity using the laws of physics. But if there’s a gust of wind that is not included in the model, then the arrow will depart slightly from its predicted path. Might not be important, unless you happen to be the person waiting at the other end with the apple on your head.

Studies have shown that social forecasting, scientific and otherwise, is about as accurate as random guessing, despite the vast numbers of highly paid experts employed to do it. If the futurologists of the 1960s had been right, for example, I would probably be writing this in an orbital space station as my personal robot tends to my toenails.—from Apollo’s Arrow

Reviews

"An impressive and wide-ranging discussion of the importance and the difficulties of predicting future events...written in a clear, accessible style.... My own prediction is that readers will enjoy this book and will come away with lots to think about."
— Jeffrey S. Rosenthal, author of Struck by Lightning: The Curious World of Probabilities

"From economics to healthcare to climatology, the science of forecasting is everywhere -- and so is the hype and hucksterism. David Orrell is one of the few experts able and willing to reveal the truth about what we can and cannot know about the future."
— Robert A.J. Matthews, author of 25 Big Ideas: The Science That’s Changing Our World

ALSO AVAILABLE: Gaia

Synopsis

The Earth - Gaia - is alive, and we are killing it. It's not a sentiment that would normally trouble oil company PR expert Sandra, even while taking an eco-tourist trip in Venezuela with her sister Anne. But when Anne suddenly and tragically dies of a mysterious illness, and her body goes missing, Sandra and her colleague, investigative journalist Frank, begin a different kind of journey.

Travelling from a jungle paradise to the slums of Caracas, they encounter corrupt police forces, extreme environmentalists, holistic scientists, and an Earth-worshipping religious cult, led by Angel, whom the authorities claim was killed in a mass-suicide pact but whose influence lives on. As Sandra and Frank move from grief to an unexpected love, they are caught up in a race against a horrible prophecy that they seem powerless to avert. For whatever befalls the Earth, befalls the sons and daughters of the Earth …